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Gary Shapiro is the showman of the greatest technology show on Earth. As the president and CEO of the Consumer Technology Association (CTA), he presides over CES, commonly known as the Consumer Electronics Show. CES 2018 is just around the corner, running from early press events starting on January 7 through January 12.
The big tech trade show drew 184,498 people earlier this year, and Shapiro is planning for another record-breaking event in January. The show will likely have more than 4,000 exhibitors across 2.6 million square feet of exhibit space, though final numbers will be out later. I talked to Shapiro in our annual ritual, getting a preview of the event that sets the tone for the tech industry for the coming year.
More startups will be coming this year to the Eureka Park section of the event, which will have 800 companies compared to 600 a year ago. At least 118 government leaders will be there, and many of them will be engaging on the topic of net neutrality, which the FCC is in the midst of dismantling. I’ll be among the 7,000-plus media at the event.
Some facts about the show: The drone section of the show floor will have 47 exhibitors, up 15 percent from last year, across 38,550 square feet, down 1 percent. The robotics section will have 35 exhibitors, up 30 percent, across 21,500 square feet, up 68 percent.
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Augmented reality will have 24 exhibitors, up 20 percent, across 10,900 square feet, up 30.5 percent. Gaming and virtual reality will have 46 exhibitors, down 36 percent from 72 last year, across 37,500 square feet, up 26 percent.
Here’s an edited transcript of our interview. And here’s my take on last year’s show and my recommendations for newcomers.
VB: What’s your take on the show and what it’s going to be like?
Gary Shapiro: Well, I don’t want to sound repetitive from prior years, but the truth is CES will be a record setter. It’s clearly become a global stage for innovation. Last week, we determined that our footprint for 2018 is now larger than the footprint for 2017. We do estimates in terms of the number of attendees and things like that, but we really don’t know until after the show’s over, and we have an audit done independently. But in terms of footprint, we’ll be bigger. Last year, we were about 2.6 million net square feet. This year, we just surpassed 2.6 million net square feet. It will be bigger. The official stat is more than 2.6 million.
We’re projecting 4,000 exhibitors, and we were just about 4,000 last year, but because there’s aggregators and a lot of last-minute things, we don’t really have good final numbers. It’ll be comparable to last year. But in terms of size — we’re different from Europe, where they count up everything. We just count up actual sold space. Europe counts vertically while even if you have a three-story exhibit, we just count your footprint. So, we’re bigger.
We don’t know if we’ll have more international people or not because we’re keeping an eye on the fact that — the first six months of the year, international visits to the U.S. have gone down pretty significantly, especially business visitors, which are down about 10 percent. One-third of all the people came from outside last year. We’ll have more than 100 foreign delegations. We’re expecting ministers from France, the Netherlands, Mexico. We have major brands attending the show, 76 percent of the Fortune 100 and 93 percent of the Interbrand 100.
VB: How about the startups?
Shapiro: Eureka Park, one of my favorite parts of the show, we’re expecting it to grow from 600 startups in 2017 to 800 in 2018. It’s a buzz area. There’s a lot of countries now participating, 37 countries. Those countries sometimes come with some pretty cool people. France, where we had 5,000 people come from last year, we’ve had a lot of ministers, including Emmanuel Macron in prior years. This year, we’re expecting a lot of very senior government officials from France. We’ll have the prince of the Netherlands, and the Netherlands will have a significant presence in Eureka Park and elsewhere.
We’ll have a lot of government officials, talking about who’s coming. Last year, we had about 55 government officials at this time that we could talk about. Right now, we have 118, including members of Congress, the entire FCC, the FTC, the chairmen and all the commissioners. We have top elected officials from a number of states. We have international officials from several countries — Colombia, Nigeria, Taiwan, Togo, France, and others. People from the White House, the Senate, the House, about every government agency you could name.
There’s increasing focus on life-changing and life-saving innovations. A lot of disruptive technology. A lot of empowerment of elderly people and people with disabilities. A lot of good things. We have a sports zone that’s focused on sports technology, including stadium technology.
VB: What are new categories?
Shapiro: We have a huge focus for the first time on smart cities at CES. If you talk to a number of major companies, they’re very excited about this. We have more than 40 exhibitors and 12,000 square feet showing smart-city stuff. There’ll be conferences, parts of other exhibits talking about this. This is tied to 5G and what we all know is coming. This is an area that’s a first at CES, and when you talk to me a year from now, it’ll be even bigger. Artificial intelligence is very hot throughout the show. We have a discrete area focused on it with 15 companies, including IBM, Baidu, and Yamaha.
For the first time, we’ve tried to make the show so that anyone with an idea can implement the idea through the services and the companies at the show. If you have an idea for a product or an app or anything, we have an area called the Design and Source Marketplace, which will have more than 700 exhibitors. Most of them were exhibitors from other countries where they were offering manufacturing. They’re not pushing brand names. They have the fact that they can make stuff. There’s also designers, product creators, and others. That’ll be in a temporary structure, a very big one.
We have a special high-tech retailing summit. We have a digital money forum. In terms of noteworthy growth, the one that sticks out to me is the vehicle technology. That’s had 23 percent growth in footprint, 19 percent growth in exhibitors, 401 exhibitors there as of today. I was asking our research department if we were a car show, where would we be? We’d be in the top five, I believe, right after the Detroit Auto Show, in terms of size. But that’s not a precise number. And the car shows are public shows. They’re almost exclusively finished product, and we’re the entire ecosystem of products.
We have C Space, which we started a few years ago, and now, it’s become the CMO stopping point. We have content and new platforms and technology meetings. We have 41 exhibitors in 137,000 square feet of space there, with a number of companies doubling their investment. Amazon and eBay are advertising. Google, Hulu, and Spotify are increasing their participation there.
VB: What are the top trends in tech?
Shapiro: In terms of trends, a lot of the talk last year was obviously about Amazon’s Alexa. Now, it’s gone way beyond that to other platforms. Voice and speech recognition is pushing into the mainstream. It’s getting into cars and elsewhere. The accuracy of speech recognition used to be maybe … 80 or 75 percent in the last few years, and now, it’s over 97 percent. It’s going across all devices. This Thanksgiving season, it’s become the fourth sales channel. We have digital assistants like Alexa and Google, that’s how things are changing.
I mentioned 5G. It’s still early, but companies will still be talking about it and showing stuff about what they could do when you have a network that’s five times faster and five times more responsive.
VB: Did anyone try to do a 5G demo at CES? I know they’re doing some for the Olympics.
Shapiro: For this event, I do not know. They’ll be talking about it. Whether they’ll be showing — I’d expressed some skepticism at one of our member meetings in October about whether there would be anything in 5G, and debate broke out between my members. But I just don’t know. I do know that in 2019, there will be a lot, but in terms of what we have in 5G right now, if there is stuff, it’ll be more prototypes, more talking about it and planning for it. I guarantee it’ll be much further advanced in 2019.
I mentioned smart cities. We released research in Europe recently showing that a lot of European cities are ahead of the U.S. in that area. There’s a huge shift in the world where the city is getting bigger. People are moving into the city. Today, more than half the world lives in cities, and soon, that will increase to two-thirds. Fifty years ago, only one-third of the world lived in cities. There’s a lot of changes happening there. That’s where you have 5G, self-driving, and AI meeting.
Voice-assisted smart speakers, a lot of companies there — Panasonic, Sony, Amazon, Google. We expect to see 360-degree room-filling sound, single deployment stereo products, all sorts of stuff. And then, there’s AR and VR. You’ve written a lot about it. It’s growing. Biometrics, there’s a lot there for security and authentication.
VB: Do you have any figures on the AR/VR section and how that’s changed over the years?
Shapiro: We are up. We have 23 exhibitors, 11,000 square feet, up five percent. That’s all just AR, not VR. I can follow up with specific numbers for VR. We’re also up in the smart-home marketplace, up 30 percent, with 189 exhibitors and 123,000 square feet. We’re up in the robotics marketplace, which I think is going to keep growing and growing, up six percent there. There’s huge growth, obviously, in gaming, all the accessories connected to it.
The one that was interesting this year at our board meeting, with board members giving their personal experiences with major retailers around the country, was AR and VR and all the accessories that go with it, and the high-end computers that are being sold. That was pretty big. That’s a huge trend, obviously.
VB: What are some of the issues you see this year at the forefront?
Shapiro: We have a whole policy track. Last year, it was standing-room only. When we had our debriefing after the show, I said, “Wow. I remember I used to do that, and we’d have more members of Congress than we had people in the room.” Maybe it’s because of the election last year, but people were really focused on it.
We have a huge number of people coming that want to speak and a lot of issues. Cybersecurity we’ll have a focus on. Some of it is category specific — like self-driving cars, where we have a lot of senior people coming from the Department of Transportation. We have Lyft speaking, Ford speaking in visible positions. We’ll have panel sessions. There’s legislation before Congress right now on self-driving. It’s bipartisan, which is why you don’t hear a lot about it. But it’s moving.
Net neutrality will be a big issue. FCC Chairman Ajit Pai was a speaker at an event I was at last week, and there was a huge amount of security. It’s a very emotional issue. It’s an issue that the CTA — I wouldn’t say we have not engaged on it, but we’ve made the argument that competition in broadband would be really important. The other area which is important, we’ll be releasing, as the CTA, the Innovation Scorecard on a global basis. We’re ranking different countries. Not all countries, but the countries for which we have data available.
VB: Going back to net neutrality, I guess it’s safe to say it’s a much more emotional topic this year than a year ago.
Shapiro: It’s emotional because a lot’s going to happen in the next couple of weeks. Last year, it was a done deal and people were just — I don’t know if we had a panel on it. The year before, when the Obama administration changed the voluntary adherence to net neutrality principles, it became a big deal. Now, obviously, the Republicans are going the other way. It’s an interesting dynamic because on the one hand, it’s a Republican position, but it’s changed since the last debate.
It used to be that people would say the tech industry thinks net neutrality is critical, and now — we had a meeting of our carmakers last week, and they think the use of Title II for net neutrality is of great concern because it does say no prioritization. It regulates anything that hooks up to the internet. A car hooks up to the internet now. That’s what’s changed in a few years. If you have the task of regulating that, how can you say there shouldn’t be prioritization when it comes to safety? That’s a compelling argument, if that’s the basis of your self-driving car, its access to the internet.
Some of the arguments have changed, and some of the players have shifted. It’s become more of a populist issue. I don’t think the tech industry is that pure. From our point of view at the CTA, I can say that Title II is definitely not our preferred course for net neutrality. I worked on the principles 15 or 20 years ago, walked in the FCC, and was so happy that everyone accepted these as voluntary principles. I think we’ve been phenomenally successful since then. I begged the chairman of the FCC not to go forward. We have embraced what we call “regulatory humility.” The person who coined that phrase will be at CES, the acting head of the FTC, Maureen Ohlhausen. Don’t mess it up by trying to anticipate the flow of innovation and technology. Let’s show some humility. Government has an important role to regulate, but let’s make sure there’s actual harm.
VB: The other thing that seems to be crossing all of culture these days is what’s on the cover of Time Magazine, the year of the “silence breakers” and sexual harassment issues. Do you detect any activity on that front as far as sessions go, people wanting to talk about it in some venue?
Shapiro: In 2017, we did have a panel focused on diversity. It was all women. But it was one of our least attended. I haven’t seen any interest this year. Certainly, people in that world of diversity trainers — I’m not going to say they haven’t contacted us and offered their services. But we’re focused on innovation, the future, business, things like that. That’s not an area where we’re presently planning to have anything that I’m aware of, as far as focusing on sexual harassment. It’s difficult to figure out who the audience would be.
Diversity is still a core principle of who we are and what we do. At CES in 2017, we had 250 or 275 women speaking. We’re always focused on diversity. But diversity and sexual harassment are different things in my view.
VB: The only thing I noticed — from talking to one person, they dinged you guys for not having a woman keynoter this year.
Shapiro: We do have women keynoters, and we’re certainly going to be making some announcements. We always have to cross Ts and dot Is. Our history, as I told you in 2017 — women have been on the CES keynote stage at least 15 times in the last seven years. We have several hundred speakers. A good number of them are women, although I don’t know the exact number. When we talk about diversity at CES, those platforms that those women and other speakers have are very important. They’re getting a voice and making a difference. That’s pretty important to us.
It’s a business show, obviously. We’re not going to ignore diversity. We’ve been a pretty proud advocate for women, minority, and immigrant tech leaders. We have a lot of coveted spots — super sessions, keynote tracks, storyteller panels. I would argue that all of our women minority speakers deserve attention. To single out the keynote stage ignores the people who invest a lot of energy and expertise in CES.
We have Lisa Sugar, the president and founder of PopSugar. Stephanie McMahon, chief brand officer of WWE. Molly Battin, chief brand strategy officer at Turner. Julie Plec, executive producer and creator of [The Vampire Diaries]. Sarah DeWitt, VP of PBS Kids Digital. We have the head of A&E, Nancy Dubuc, since that was just leaked out. She’ll be part of a keynote panel. We have more announcements coming as well.
VB: One of the keynotes I liked a lot last year was the Carnival one. It was all about a non-tech company embracing technology and making it invisible on their cruise ships. That seemed like a very different kind of keynote, as opposed to the ones that come from tech companies.
Shapiro: That’s a great point. At the time, I felt we were taking a risk. I labored over that decision, honestly, more than any other keynote decision I’d made. It’s a cruise company, but honestly, they had presented a vision that was focused on a smart city in a way that was just beautiful. That got us into the smart-city space. They’re clearly investing a huge amount of money. I believe, as of tomorrow, if you go to our web page, there will be something on it. Our marketing people are really excited about it. It shows what happened because of that keynote. They were very pleased. I was very pleased. I didn’t hear any criticism of it at all from anyone. It was a stretch, and it was great. We’re hoping for more stuff like that.
The keynote stage is for big companies that have something to say. If it’s a single-person keynote, they’re presenting a vision, a product, a trend. That’s what we want and what we look for. The other one that really turned me on is when Reed Hastings of Netflix spoke, and as he was speaking, the person next to me was watching his stock go up several points. That was cool.
Having said that, we have great keynoters in so many different ways and so many different areas. Brian Krzanich of Intel is always amazing. He used this platform to announce their diversity goals, which were pretty aggressive, reflecting the U.S. population in their employees by 2020. We also have Huawei, which is a big deal.
VB: Turner and Hulu, they seem like not necessarily your normal keynoters.
Shapiro: We expanded a few years ago. We went with this thing called C Space. There are a lot of exhibits now, but it didn’t start that way. It’s a kind of conference for chief marketing officers. They’re getting together and trying to figure out how they deal with all this new technology, all these new platforms. Instead of just putting an ad out in the trades — the technology is changing so quickly, they have to deal with it.
The issue in the marketing world is that if you can do something different, it could be very inexpensive because you’re there first. Then, everyone else figures it out, and they do it, so it gets more expensive. Then, you go on to the next thing. With platforms like Twitter and Facebook and everything else out there, they’re trying to keep abreast. They need to get together. It’s not just CMOs from our traditional tech companies. They’re CMOs from some of the major brands. We’re getting more focus on that. It’s grown into a few locations now. There’s a lot going on there. It’s very popular, and it’s getting more visibility.
The stage sets, we mixed them up a bit this year. The physical facility is a bit different. Aria is the headquarters of C Space. One of the major conference components, the storytellers are there, intertwined with all the exhibits. There’s a huge seating area. And then, right adjacent to that is our new keynote venue, the Park Theater. We’ll have the Intel keynote and the C Space keynotes happening there. We’re not using the Westgate Theater at this point, but it’s on hold in case we need it for overflow.
VB: Can you address the security issue? Is there the same security level as before or anything different?
Shapiro: Security, as it has been since I started, is always evolving depending on the world situation. We’ve come a long way in the 30 years I’ve been involved in that specific issue. The physical security issue, we spend a lot of time on it. We’re always trying to do the best we can. We work local officials, the FBI, Homeland Security, and others pretty carefully.
One thing the FBI recommended to us a year or two ago was that we go to a photo ID system, a photo on the badge, because that way, people can’t transfer their badges off. Frankly, it helps us in a lot of different ways. There are lots of reasons to do that.
We have many different types of security, but in terms of the outward-facing things I’m happy to talk about, we’ve changed the patterns of how people flow in and out of the facilities over the years. We’ve gotten better flow. We’ve stopped allowing, except with very careful exceptions, people carrying bags in. We ask for transparent bags, which are apparently a very popular item on eBay now, CES transparent bags. We obviously use all the standard tools that any venues use around the country and the world in terms of security.
We have a new security app, which is really cool. It’s made by a company called LiveSafe. I met their CEO, Carolyn Parent. The Hearst Company invested in this startup. I’m so impressed by what they do. It’s used by a lot of companies on a full-time basis, the NFL, and elsewhere, but it allows people to do all sorts of things. They can report things, take a picture — it even allows people to track their employees to make sure they get to their cars at night. For us, it’s mainly about, “If you see something, say something.” We want to promote that. We’ll be out there with different ways of doing that.
As we get closer to the show, of course, we’ll have more security messaging that’s focused on the site. But we take security very seriously. It’s obviously a big business event with a lot of important people. When you get some of the people we attract, at the government and CEO level, a lot of security people get involved.