Consumer Technology Association believes China tech market will outsize US

It's all about innovation and brands at CES Asia
It's all about innovation and brands at CES Asia
This firm made a drone that can fit in your palm
This firm made a drone that can fit in your palm
CES Asia 2016: The latest in smart devices
CES Asia 2016: The latest in smart devices

Tech enthusiasts the world over will be zeroing in on Shanghai as the annual Consumer Electronics Show (CES) Asia kicks off on Wednesday. While it's considerably smaller than its U.S. counterpart, CES Las Vegas, that may not be the case for much longer.

Speaking to CNBC on the sidelines of the event, Gary Shapiro, president and CEO at the Consumer Technology Association, the show's organizer, said that China's consumer technology market could soon overtake that of the world's largest economy.

"The U.S. is still bigger but this year or the next, we expect the Chinese market on a dollar or yen value will exceed it," Shapiro said.

China's consumer technology market is currently posting about 3 percent annual growth, Shaprio said. While that's slower than recent years, it's still stronger than the majority of the world, he added.

"As unit costs come down, then you see a slowdown in total revenue. But at the same time, we're seeing tremendous new product introductions in virtual reality, augmented reality, the Internet of Things—new categories that are higher priced and should drive growth going forward."

The U.S. meanwhile, is showing worrying signs, Shapiro said, pointing to examples such as the 4K television market, where unit sales are doing well but prices are falling. 4K televisions, also known as Ultra High Definition (UHD) TVs, offer higher resolution picture quality than previous models.

The Concept Intelligent Aerodynamic Automobile by Mercedes-Benz on display at CES Asia 2016. The model can switch automatically from design mode to aerodynamic mode when the vehicle reaches a speed of 80 km/h.
Barry Huang | CNBC

CES Asia aims to attract both innovators and major brands, so companies have to fall into one of those categories in order to exhibit in the event, Shapiro explained. The show is only in its second year but had already doubled in size, he added.

Key attractions this year include Intel's drone collection, Shapiro said, noting that the U.S. firm had set up the largest drone tent ever seen at a trade show.

Another highlight was two cars that Mercedes had on display, he said. "One is a hybrid and the other is aimed at the luxury market, a China-only car with different lighting configurations and sensors."

One exhibitor, Silicon Valley-headquartered MOTA, is showcasing what it called the world's smallest and lightest drone.

The paperclip-sized JETJAT Nano, retailing at $50, weighs 4 ounces and was suitable for all ages, MOTA president Michael Faro told CNBC.

MOTA's JETJAT Nano drone. It has a 2.4 GHz wireless signal, a 4-channel controller, and is able to soar up to 75 feet.
Barry Huang | CNBC

"You can use it as a hobby or a toy for your children...Not everybody needs to know geo-coordinates or GPS," he said.'s smart device business meanwhile, will reveal a smart refrigerator, a new generation of Wi-Fi speakers and a delivery drone, the latter which is aimed at rural China, according to JD Smart Vice President Leslie Liu.

"The drone will drop off the product to a village representative, who will then complete the last mile delivery to the consumer for us," he explained.

Also on display at CES Asia 2016 were virtual reality (VR) headsets by Shenzhen-based company 3Glasses, whose D2 Vanguard model sells for $399, significantly cheaper than Oculus Rift's $599.

"We're trying to provide the best price-performing VR devices to the market," Chief Operating Officer Philip Kong told CNBC, adding that the firm would soon expand its focus from outside Greater China to Japan, the U.S. and Europe.

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