December 26, 2006 4:00 AM PST
Domestic tasks go digital
Small kitchen gadgets like coffee makers that forecast the weather receive more attention, but it's the oft-ignored category of large appliances that's getting a jolt of energy.
Large luxury appliances are one of the fastest-growing categories in the home. As U.S. families spend tens of thousands of dollars on home remodeling, the demand for high-tech products that combine entertainment and design is growing.
Unit sales of refrigerators priced higher than $1,500--the most expensive category--increased 29.5 percent between 2005 and 2006, according to data collected by the NPD Group. That marks a substantial increase, said analyst Peter Goldman.
U.S. consumers spend approximately $12.2 million a year on refrigerators, according to numbers self-reported by consumers to The NPD Group. Of that, unit sales have increased only minimally in price ranges other than the most expensive, and have actually decreased more than 20 percent in the $100 to $300 category.
It's because of such statistics that companies like Matsushita Electric, known as Panasonic in the U.S., are considering getting into the burgeoning U.S. appliance market. The Eco-Home in Tokyo, showcased in late October, is a prototype of an environmentally friendly and futuristic house. Motorized dish racks rise out of countertops and plasma TVs are ensconced in a wall in every room for watching movies and even reading the news.
Though drastically outside of most homeowners' price ranges, the concepts present in the Eco-Home and the Sunset and Popular Science House of Innovation in Alamo, Calif., are at least indications of what homes could look like in years to come. Not only are appliances and home products becoming automated and energy-efficient, they also come saddled with high price tags.
"Consumers seem to be migrating toward the premium end of the market," said NPD's Goldman. "You're hearing about a lot more kitchen remodels, entertaining in the kitchen. The kitchen is becoming a showplace for home entertainment."
The kitchen as entertainment center, in some cases, is being taken literally, as top-tier television manufacturers carve LCD (liquid crystal display) screens into refrigerator doors. But beyond displaying TV shows and movies, the screens are also used to deliver weather forecasts, show digital pictures (in place of snapshots tacked down with magnets), keep a master calendar, receive text messages and voice mail, and in some cases, hold a bank of recipes that can be dialed into.
Electronics companies like LG and Samsung are thinking outside the white box when it comes to the domestic space. Seemingly staid categories, like laundry and refrigeration, are seeing a boost in interest from consumers and manufacturers alike.
In the Domestic Appliance category at the Consumer Electronics Show taking place in January, refrigerators and laundry systems take up almost half of the show's Innovations Awards handed out by the Industrial Designers Society of America.
The Wireless ICE Refrigerator from Samsung, set to debut right before CES, has an LCD screen that can stream a television signal wirelessly, as well as AM/FM radio. The screen also pops out and can continue to receive a TV signal up to 200 feet away.
The concept has been done before, but wasn't well-received. LG came out with a fridge that had a laptop computer in it several years back, and it didn't sell particularly well. "We learned a lot from that," said Tim Kavanaugh, LG's director of digital appliances. "A lot of people used it for the TV function that was on there, and we also determined that people weren't willing to pay $9,000 for that."
Samsung had a similar experience with its TV-fridge combo. At about $8,000, "the price was really out there," said Tony Wisniewski, Samsung home appliance marketing manager. The company made some changes, including the placement of the 10.1-inch screen, moving it from the eye level of a 5-year-old to that of the average adult. Wisniewski said Samsung believes this one will sell better, particularly at the lower price, enabled by a cheaper manufacture process and refined television technology. Both Samsung and LG's LCD fridges sell for $3,499.