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Tech Industry Sales Forecast Uneven For 2014

As the consumer tech industry kicks off 2014 at its annual convention in Las Vegas, it’s looking forward to a year in which it is expected to grow twice as fast as the U.S. economy.Tech industry sales forecast

Yet pockets of weakness remain in tech sectors, where new technologies are replacing the old.

As that inexorable technology cycle of rapid innovation and obsolescence continues, a wider geographic trend has Asian mobile device makers capturing more of the global growth in consumer electronics.

On Thursday, Forrester Research predicted global information technology spending would rise about 6% this year, with U.S. businesses accounting for 40% of it.

By comparison, U.S. auto sales expectations for 2013 were for a rise of 8%, which means parts of the Detroit Metro Area grew faster last year than some parts of Silicon Valley are expected to this year.

Detroit had some help from U.S. taxpayers, of course.

PC sales fell about 7% in 2013, IDC estimates, and that trend is expected to accelerate.

The tablet market is growing at a low double-digit rate as more consumers and workers organize their personal and professional lives around a mobile computer.

Apple, whose iPhone and iPad businesses are a good proxy for the high-end smartphone and tablet markets, is expected to see sales grow 8%, to $180 billion, for the year ending in September.

That’s now more than three times the size of Intel, which rode the PC boom for 30 years but is expected by Wall Street to scratch out 2014 annual revenue growth of just 1%, to $53 billion.

While tablets replace PCs, the battleground for growth in the global smartphone market has shifted from mature markets like the U.S. and Europe to China, where IDC expects sales to grow at least 25%.

Global smartphone market growth estimates fall roughly between 15% and 20% for 2014, well below the 40% rate IDC estimated for the third quarter.

The precise number will depend on whether one counts units or revenue, because average sales prices are falling on low- and mid-range devices across the globe.

In the third quarter of 2013, the average price of a smartphone fell 12.5% to $317, IDC said.

Samsung Electronics , the No. 1 maker of smartphones, in early December lowered its 2014 annual sales growth forecast to a rate of about 15% (depending on what the final 2013 numbers are) — down from estimated year-over-year growth of 40% in 2013.

Meanwhile, up-and-coming Chinese handset makers such as Xiaomi, Huawei and Lenovo, are expected to capture much of the growth in their home country, which is now the world’s largest smartphone market.

Last week, shortly after Apple began selling phones to customers of China Mobile, Xiaomi boldly predicted that it would double the number of phones it will ship this year.

Meanwhile, software sales will rise a more modest 8% this year, according to Forrester, while a slew of hardware categories, from storage to networking to servers, are all expected to see annual growth in the single digits.

Technology is now more global and more mobile, two trends that point toward the fastest growth in the industry.

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