Buyer’s Guide Analysis: Projectors bounce back

The projector market experienced many difficulties last year, with demand falling across most sectors as the recession took hold on budgets and spending levels. Sales dropped significantly in the first half of the year, which led to considerable and rapid change throughout the industry: many vendors had to re-evaluate business plans and implement cost-cutting measures to ensure future growth. Channel players had to react to the falling demand by managing their stock situation and taking a short-term tactical approach to gaining and offering credit.

However, towards the end of 2009, confidence began to return to EMEA markets, with record shipments of 675,000 units recorded in Q4. This represented nearly 10 per cent year-on-year growth in sales, and was the first quarter since Q3 2008 that the EMEA projectors market showed positive year-on-year growth.

Although 2009 proved to be difficult for the industry, it also represented a return to innovation. One major development was the launch of Casio’s hybrid LED Laser light source technology, which has raised the bar in the LED category with products boasting 20,000 hours lifetime, and brightness ranging from 2000 to 3000 lumens.

With long product lifetime, strong total cost of ownership arguments and robust eco credentials, Futuresource expects LED-based projection to be quickly adopted across the education sector. Competitive reaction to this development will be interesting to watch throughout 2010 and 2011, with key channel players citing an education-specified short-throw LED projector as a potential ‘killer’ product.

The projector market has also witnessed the launch of interactive projectors, where interactivity can be achieved with an infrared pen on any projection surface without the need for an interactive whiteboard. The education interactive market is currently dominated by whiteboard vendors that supply both interactive hardware and advanced education-specific software packages. Although a single interactive projector should provide clear advantages over the ‘projector interactive whiteboard’ model in terms of cost, feedback from interactive whiteboard users suggests that the main driver behind the success of interactive projectors is the software functionality of the education-specific product.

The ‘blue light’ and training sectors of the corporate business are also likely to be target markets. One factor that could alter the uptake of interactive projectors would be any change to the whiteboard vendor’s software licensing agreements, so that specialist education software from whiteboard vendors could be used by schools on any interactive projection solution.

3D is yet another major technology development. While 3D projection has been around in the high-end niche markets for some time, 2009 saw the launch of numerous products targeting the mainstream education sector. 3D content is initially expected to focus on specific subject and class types, such as geographic landscapes, heart dissections, CAD/CAM drawings and the like. However, as momentum develops and increasing numbers of case studies become available, it is likely that ’3D-ready’ may well become a core feature being specified in tenders.

The outlook for 2010 is positive, with many vendors reporting a significant increase in run-rate business and a gradual pick-up in the higher-end business. Football World Cup years tend to result in high levels of promotion for the projector market, and sales of entry-level models tend to jump.

In terms of vertical markets, the education space remains the fastest-growing sector overall. While the UK market has slowed from the heady days of the Becta tender, many other European countries are seeing rapidly growing adoption of projection and whiteboard technology in the classroom. With only eight per cent of classrooms equipped with an interactive whiteboard, and governments increasingly investing in IT in education, the market opportunity remains huge.

Demand in the corporate sector is picking up, but recent sales analysis shows that much of it is coming from the entry-level sector, with higher-end installations relatively flat. This higherend sector is gradually expected to recover as budgets are freed up and companies become more confident in the longer-term business environment. There are certain sectors of the higher end that are definitely bucking the trend: digital cinema installations, for example, are growing significantly.

While 2009 was a challenging year for everyone in the projector supply chain, the market looks set to recover with strong growth in 2010. New technologies have emerged that are likely to drive market growth for years to come, though the key questions now are how fast the likes of LED and in-built interactivity will penetrate the market and how long it will be before a projector combines all of the key developments into one. It shouldn’t be too long before we find out.