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Supply & demand

Why Canada misses out on big gadget launches

February 1, 2007

Deano Aliotta (left) and John Day install a sign at the entrance of Las Vegas Convention Center for the 2007 Consumer Electronics Show. (AP Photo/Jae C. Hong)

A show like January's International Consumer Electronics Show (CES) in Las Vegas is grand not just in its size and scope, but also in its capacity to repeatedly disappoint.

That's not so much a knock at the show's organizers or the Consumer Electronics Association (CEA), but more at the fact that the launch plans for so many of the nifty new technologies and services on display underline how little attention manufacturers pay to Canada these days.

CES is where the electronics industry displays its cutting-edge products and upcoming technology, showcasing the innovations that are likely to grab the public's imagination (and disposable income) in the following months. This year's show featured 2,700 vendors showing off their wares — everything from wristwatch TVs, to the latest cellphones, to slick little internet appliances for the desktop.

But digging deeper into the slew of announcements, press releases and interviews over the course of the show, questions regarding Canadian pricing and availability elicited either lukewarm apologetic responses, or a "no plans yet" shrug of the shoulders from manufacturers.

U.S. effect

Canada borders on a gigantic consumer electronics market, and logic would suggest that new products would be launched in both countries simultaneously. But instead of benefiting from the U.S. appetite for the latest gadgetry, Canadians are often forgotten in the shadow of their U.S. neighbours as manufacturers rush to get new products onto retail shelves in the biggest possible markets.

To illustrate this just look at ATI, a Canadian firm recently acquired by U.S.-based chip specialist Advanced Micro Devices (AMD). The new TV Wonder Digital Cable Tuner developed by Markham, Ont.-based ATI was shown at CES and will be built into select desktop PCs and laptops, and it's getting lots of attention because it will pipe a high-definition digital cable signal into a desktop computer.

"For the very first time, with AMD's new ATI TV Wonder Digital Cable Tuner, users of Windows Vista Media Center in the United States will finally be able to access premium HD cable content including HBO, Showtime and many other favourites previously unavailable on the PC," said Blair Birmingham, group product manager for AMD's Visual and Media Businesses.

The problem for Canadians: It's built using the CableCard standard to cater to the U.S. market, a standard that Canadian cable companies have either been unwilling or unable to adopt thus far. American consumers will be the only ones to really take advantage of the high-quality HD feature based on Canadian-made technology. ATI hasn't invested in developing a similar product for Canada's smaller market.

"We worked closely with CableLabs and Microsoft to enable OpenCable CableCard support for the PC with this product," Birmingham said. "While we currently have no plans to offer this product in Canada, since OpenCable and CableCards are not used here, we are very open to working with the nation's cable industry to demonstrate the value premium HDTV content on the PC via OpenCable and CableCard offers to cable subscribers."

What that means is that Canadians will be stuck watching standard-definition cable broadcasts on their computer TV tuners, or pulling in free over-the-air HD broadcasts using TV-set top boxes instead of unlocking the multimedia potential of their desktop PCs. Canadians will miss out on the opportunity to make their PCs their very own high-quality personal video recorders and sync recorded content with devices like Microsoft's Xbox 360 through the new Windows Vista operating system.

And that's just one example. Cellphone manufacturers like Samsung, LG and Motorola displayed an array of new items at CES, but with either no foreseeable Canadian launch date or a bypass of the Canadian market altogether. The big draw at the show was systems that deliver television through the phone, which is by no means a new feature in other parts of the world, but something that is still left out of handsets in Canada.

No MotoMING ring here

Other major markets have the same size advantage as the U.S., getting first access to the top technology. The MotoMING, for example, is the number-one-selling handset in China, but there are no definitive plans for a Canadian release, though manufacturer Motorola's spokespeople did indicate that the company is looking to potentially market the phone in North America. The issue is whether or not the cellphone carriers will add the phone to their product offerings.

Part of the problem in Canada is that it's a small market, and a small group of service providers has a lot of sway over what gets introduced here. Generally speaking, there aren't enough buyers in Canada to make it really worthwhile for handset manufacturers to invest heavily in introducing and marketing specific models here without the backing of the carriers.

"We can't comment about potential launches of products or services for competitive reasons, nor do we release our strategy for featuring one phone over another," said Odette Coleman, corporate communications manager with Rogers Wireless. "However, what I can say is that if you look at [last fall], our focus has been very much on music and our selection of handsets is aligned with that by featuring a large selection of MP3 phones."

For its part, Samsung offered up a roster of cellphones and portable devices at CES that are great but won't see the light of day in Canada anytime soon — if at all. The most notable of these is definitely the Blackjack, a PDA device that has a look and feel meant to compete with the Motorola Q. Watch a U.S. network and you're bound to see a commercial for the Blackjack, which saw a big marketing push in the U.S. during the tail end of the Christmas shopping season.

Samsung even displayed a limited-edition phone that is themed on the upcoming movie based on The Simpsons television show. The interesting thing about it isn't so much the endorsement, but rather that the same phone comes in three unique designs — at least in the U.S.

"It's a little tough because we would love to get all these products into the Canadian market," said Patty Chung, corporate communications director for Samsung Canada. "But in order for us to make that happen, we have to make sure that the cellphone carriers are on board and willing to market these phones with their services."

Canada-U.S. disparity

It's not just a marketing issue, though. There are also logistical and legal concerns about introducing a new product in Canada.

Analyst Danielle Levitas, vice-president of consumer and broadband markets at technology market analysis firm International Data Corp. (IDC), views the disparity between the two countries as more of a logistical problem.

"There's no real data that supports this, but it would certainly take some of these companies time to meet different regulations with different countries," Levitas said. "Since Canada has a different approval process and legislation, that could slow down the process a lot for some products, and maybe a little for others."

Being a bilingual country also brings the type of challenges that can sometimes plague European launches. Instruction manuals written in French are usually outsourced, which can add time to a prospective product launch.

"Writing and putting out manuals in French is part of it, but there's also the mechanical side of it, because the product may also have to display content in French as well, which could take even more time," Levitas said. "It's not that the bilingualism is always a roadblock, because there are also content services [such as Amazon Unbox or downloading movies from Apple iTunes] that take longer to get to Canada simply because of things like the exchange rate and the logistics of paying the right people."

Despite shipping in the fall in the U.S., for example, Microsoft's Zune portable media device still has no set launch date for Canada, with some analysts suggesting it could be another 10 months before the controversial player hits Canadian retailers' shelves. At this point, Microsoft says there are "plans to launch the Zune in additional countries," but nothing specific to Canada has been revealed.

Silver lining

Of course, some point out that there are benefits to not being on the leading — and sometimes bleeding — edge of consumer electronics technology.

"Americans and their huge market make great guinea pigs," Levitas said. "Sometimes the kinks in a product or service need to be tested [in the U.S.] before it can be offered to other parts of the world."

So while Canadians may not have access to the newest gadgets at the same time as some larger markets such as the U.S., there is something to be said for letting other consumers be the test pilots for new gear. But that's little comfort to those who live for the latest new thing. For them, it seems patience will continue to be a virtue.

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