Reconnecting With the Spirit of Innovation

In spite of what may be charitably described as a lukewarm business climate, an annual conference of suppliers, distributors, and electronics reps is looking solidly toward the future and the innovation that drives the industry.

Attendance at this year's Electronic Components Industry Association Executive Conference is the highest since 2008, according to Robin Gray, president of the ECIA. Most attendees say they are facing a challenging business environment as oversupply plagues one part of the industry (semiconductors), and a potential shortage looms for the hard disk industry following flooding in Taiwan. But presenters gave the industry a much-needed shot in the arm by focusing on innovation, partnership, and profitability. Here are few highlights from the conference.

The cloud is going to be a good thing for the hardware industry for the near future, according to Glenn Derene, senior technology editor at Popular Mechanics magazine. In concept, he said, the ability to centralize and share data in the cloud should reduce the number of gadgets consumers use because memory and speed become less of a differentiator for each device.

But the opposite has occurred: Consumers still use their phones and their PCs or tablets for a variety of uses. Mobility is still the driving force behind the consumption of electronics. It's possible a device such as the "ultrabook" may bring together mobility with content creation, but for the near-term, PCs, tablets, and smartphones will continue to coexist.

The forecast for the 2011 semiconductor market continues to look grim and is still a moving target, according to IHS iSuppli director and chief analyst for semiconductor manufacturing Len Jelinek. Forecasts for 4.5 percent growth earlier in the year have been downgraded to 2.9 percent, and that number is still under pressure, says Jelinek. The reasons: US consumers are still afraid of spending because of the jobs market and the global economy; Europe is struggling with a debt crisis; Japan, in spite of a remarkable recovery from the March disaster, still remains a closed market to many foreign businesses; and emerging markets are fighting inflation.

The upshot: The semiconductor market is expected to see 2.9 percent growth in 2011; the market will stabilize in early 2012; and growth will begin to gain traction in the second half of the year.

In the most inspiring presentation of the day (if not the year) inventor Dean Kamen advocated the role of science and technology in education. Kamen, holder of 440 patents and the inventor of the Segway, said his greatest accomplishment was the founding of FIRST -- For Inspiration and Recognition of Science and Technology.

FIRST is a mentoring program in which professionals help students compete in an annual robot-building contest for a total of $14 million in scholarships. From a handful of executive volunteers in 1989, FIRST has expanded to 50 countries around the globe. Independent studies show FIRST alumni go on to graduate high school and college and most pursue careers in science and technology. Kamen has had the support of Fortune 500 corporations and has developed technology that has vastly improved the quality of life for diabetics, amputees, and impoverished people around the world.

EBN will be writing more about his efforts in upcoming weeks. We'll also provide more information on other presentations and winners of the ECIA Marketing Awards.