CeBIT struggles to stop rot as exhibitors jump ship

By Jean-Baptiste Piggin HAMBURG, dpa

CeBIT, the annual trade fair devoted to computers and communication, is struggling to halt a sharp decline in exhibitor numbers which many observers say is evidence that the sector is losing some mystique and becoming as familiar as the car industry.

CeBIT’s glory days were a decade ago during the scramble by start-up companies to win attention for gadgets and software which most customers had never heard of and did not yet know they needed.

Today, consumers worldwide have a strong sense of needing flat-panel televisions, nifty mobile phones and MP3 players, and advertising and branding are a key part of the business.

British carmaker Jaguar dreamed up a slogan, “grace, pace and space,” which neatly sums up the issues that most of the automotive industry uses to sell its wares: the technology inside only interests a minority of buyers.

Consumer-electronics companies have made a similar transition, selling their products by what they do, not by the obscure software and chips inside the case. Many of those companies no longer feel comfortable at a technology fair like CeBIT.

CeBIT organizers admit that the 2007 fair will be 10 percent smaller than last year’s in space terms, mainly because of the absence of big multinationals which prefer to reach out directly to retailers and shoppers.

The smaller exhibitors who need contact with trade buyers have stayed and this year’s CeBIT, from March 15 to 21, will have 6,000 exhibitors, only a slight fall in absolute numbers, say the organizers, the Deutsche Messe company in Hanover, northern Germany.

Notable stayaways this year include mobile handset manufacturers Nokia and Motorola.

Since the end of the dot-com boom in 2001, it has been death by a thousand cuts for the trade show, which used to boast that it was bigger than anything the United States or Asia had to offer.

At its peak in 2001, CeBIT had 8,100 exhibitors taking up 431,000 square meters for 840,000 visitors. Space sold this year totals 280,000 square meters.

BenQ of Taiwan and Lenovo of China are others which have joined the non-attender camp. Philips quit the 2006 CeBIT. Apple, which prefers to hold its own Apple exhibitions, has not taken part for many years.

To stop the rot, organizers aim to shorten CeBIT next year to six days and make the fair more rewarding for business buyers and the thousands of European and Asian electronics companies that use the event to make contact with new customers in Europe.

The action plan was decided too late for any changes to be possible at this year’s fair.

Weak growth in Europe has been blamed for some of the decline, with manufacturers living off slender mark-ups and under pressure to scrap non-essential spending for a prestigious trade-fair presence.

From 2008, changes are to be made at the fair to make it more “professional,” though Deutsche Messe executive Sven-Michael Prueser said this did not mean CeBIT was trying to exclude the general public.

Analysts say the focus on professionals rather than consumers amounts to a reluctant acceptance that the provincial city of Hanover cannot compete with the lure of Germany’s top consumer-electronics show, the annual IFA in the capital Berlin.

Next year’s CeBIT is to be moved a week or two earlier in the month, taking place from March 4 to 9, 2008. By starting on a Tuesday and ending with a Saturday and Sunday aimed at the general public, it would help exhibitors save costs, organizers said.