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SXSW 2015 and Electronica China: Strong momentum driven by innovation & competition

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This week closes two innovative trade shows for the industry: South By Southwest (SXSW) in Austin, Texas and Electronica China 2015 in Shanghai, China. While these are very different events that Smith & Associates' teams have attended, they highlight an important and central characteristic of the 2015 year to date: innovation and competition that are driving interest in the semiconductor and electronics industry are exceptionally strong and growing. From these events, our local teams have reported back on the number of new markets that are gaining momentum and with them the need for increased services along with new supply chain connections that are required to support innovation and improve margins in an ever-increasing competitive arena.

SXSW setting tomorrow's trends

As always, SXSW Interactive was a highly energetic (on the boarder of frenetic), eye-opening, fascinating event right here in Smith's backyard, Austin, TX. Our team at SXSW reported on compelling, wearable innovations including advances for medical technology. On display was everything from health & fitness apparatuses to help monitor and improve workouts to very important prosthetic innovations such as the myoelectric (robotic prosthesis) arm by the Japanese company Exiii. In fact, medical technology has become such an important innovative growth market that SXSW has expanded the events to now include the "Health and Med-Tech Expo." This new event includes panels, discussions, exhibits, and collaboration to propel the dynamic med-tech market. The fact that SXSW has made this special event and a special venue part of their permanent line-up speaks volumes regarding the forecast for significant momentum for this set of devices going forward.

Also this year, we are seeing a significant increase in the attention to automotive and transportation, in terms of alternately fueled vehicles, increases in Advanced Driver Assistance Systems (ADAS), as well as new service options for cooperative transportation programs that rely heavily on connected devices. Whether people are or will be connecting via smartphones or some wearable device (rings were gaining attention at SXSW!), the means for connecting is expanding quickly but connected devices are the center of it all.

No matter where we looked at SXSW, the underlying theme of Internet of Things (IoT) and all the new, exciting means for connecting "Things" is fueling the energy in Austin and the market in general. This isn't new news really, but the maturity of the IoT solutions and the expanding set of wearables in all sorts of forms and types is definitely leading to the breakthroughs that will give consumers their own ways to wear what they use to connect and engage in the IoT (watch, ring, clothing, glasses, necklaces, etc.). In Austin, all that connectivity is now turning to the music industry for some conference time and the evenings are warming up to provide the live music forum that is at the heart and roots of SXSW.

Electronica China highlights regional refocus

Meanwhile, in Shanghai, China, Smith's local team with some of our US-based executives have seen this year's well-attended Electronica China come to an end. Also here in Shanghai, there were numerous innovative products, components and services showcased. Among the most important aspects of Electronica China was the ability to speak with so many customers and partners in Asia. What we are hearing from these conversations is a real focus on maximizing local networks and building new, strong, quality rich, supply chains that meet the unique demands and strategies of up-and-coming OEMs. The competitive landscape is definitely broadening in Asia and India with the support of national government economic plans and consumers' own interest in supporting national brands.

This local focus is a powerful change that is growing in Asia and India, especially. There have long been strong and well-recognized, local OEMs, alongside of the global leaders from Asia, EU and the US who play an important and heavily weighted role as the ones to surpass. Over the past year and especially at Electronica China, we have seen the supply chain effect that the impact of Xiaomi and Huawei have had. This new competitive market strategy reaches far beyond the device and market competition to knock off the global OEM leaders. These new Chinese OEMs are paving the ground for other local OEMs to set their sights on bigger market footprints. What that means for the supply chain is that there is greater competition for components but also greater competition for providing those components. To meet these demands and navigate through the many possible sourcing options we at Smith are seeing a significant rise in the demand for local knowledge, local presence, and local connections to be the "feet-on-the-ground" and ensure the best supply chain services and best quality and pricing available.

In response to the supply chain expansion and challenges that brings for our customers, Smith is continuing to expand our Global Services to provide an end-to-end set of solutions for inventory, procurement & sourcing, logistics, testing, and related services. Smith is also working hard and quickly to expand our regional offices to meet the local demands and needs of our customers and their similarly expanding regional footprints.

There is no doubt that the momentum and energy we have seen across all of this year's industry events is going to ensure that the positive growth forecasts for the industry will be realized. To meet these growth opportunities though will require new global supply chains, new relationships and a vigilant eye to ensuring the latest and best counterfeit mitigation strategies are in place. Smith's Global Services and our world-recognized, sophisticated testing facilities are equipped and well-prepared to offer customized solutions and services to ensure the best competitive position in these dynamic market times.


Lisa Ann Cairns, Ph.D.
Written on Thursday, 19 March 2015 15:29 by Lisa Ann Cairns, Ph.D.

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