Analyst says Comdex may be gone for good

The cancellation of MediaLive International’s Comdex trade show in Las Vegas this year was caused by mismanagement, poor marketing and a lack of focus, industry analysts said.

Despites promises to return in November 2005, Comdex could well be dead, according to Andrew Olson, managing director for consulting firm Team Group International. “MediaLive’s marketing never understood the marketplace. I don’t think it’s going to come back,” he said.

The show, which was cancelled for this year due to a lack of key vendors, is now in the hands of MediaLive’s board of industry experts, who will decide its future fate, said Eric Faurot, vice president and general manager of the Comdex brand at MediaLive.

“The board is going to sit down, talk about where the industry is now and see how Comdex fits into the equation. It is the only brand available to 40,000 qualified buyers,” he said. The board has executives from IT industry heavyweights including Microsoft, Oracle, EMC and Advanced Micro Devices.

From the days of attracting almost 250,000 visitors at its peak in the mid-1990s, to drawing less that 50,000 users last year, Comdex started going downhill from the time Key3Media Group (later renamed MediaLive International) bought it from Softbank in 1995, according to Olson.

Olson spoke at the first Comdex trade show in 1979, when it featured about 170 exhibitors and a few thousand attendees.

“At that time, we had only one (other) user conference – the National Computer Conference.” he said. He enjoyed attending Comdex. “It was exciting to be part of something that was growing every year. It was the single best location for maximum coverage of the industry and a good place to meet prospective clients. It was so big that everyone had to go.”

But from a trade show that once generated a positive buzz, Comdex got so bloated that it started to collapse under its own weight in the late 1990s, he said. The quality of attendees declined and as a result exhibitors stopped coming.

Business buyers originally went to Comdex to meet sellers, said Rob Enderle, principal analyst for The Enderle Group. “Over the last couple of years, the show lost its center. It became too much of a toy show,” he said.

MediaLive tried to rebuild the show, but while it had some of the sellers, it didn’t have enough buyers because they had not budgeted for the event, Enderle said. “One of the big blows was losing IBM,” which stopped attending in 1998, he said.

Moreover, in today’s highly competitive environment sellers can no longer wait for Comdex to make a splashy product introduction. “If the product’s ready for market, you’ve got to introduce it,” Olson said. Sellers either go on a road show or to regional shows to launch their products, he said.

Faced with increasing competition from the Consumer Electronics Show held every January in Las Vegas, Comdex tried to embrace the consumer electronics market. Because of that, the show headed off on the wrong course, Enderle said. “They shouldn’t have jumped into consumer electronics, it almost killed the show,” he said.

Comdex may still have some life left in it, he said. This year, MediaLive was faced with producing a marginal show or calling it off altogether, and it chose the latter course, he said. If it starts afresh and displays new and emerging technologies such as video conferencing that could hit the marketplace in a few years, that could greatly expand its potential audience, he said.

Since MediaLive emerged from bankruptcy in July 2003, its aim has been to bring trust back to the Comdex brand, said Faurot. “We took over management of Comdex a year ago and built a team that knew this market,” he said. The new team has put more focus on qualifying the audience of buyers and sellers, he said. “All of the key vendors believe we’re doing the right thing.”

Comdex’s cancellation this year does not reflect the state of the IT industry, analysts said. Worldwide IT spending is expected to grow 5% this year, driven by an improving global economy, according to a recent IDC report.

“I don’t take the state of the IT industry (to be) the reason why Comdex was cancelled. Yes, we have a dip, but there is still lots of spending in many marketplaces,” Olson said. Shows by Gartner and Meta Group have been oversubscribed, and shows such as CES, NetWorld+Interop, and Cebit in Germany are registering growing audiences, according to the analysts.

The cancellation has more to do with the mismanagement of Comdex than a poor IT marketplace, said Enderle. “Comdex was badly managed over the past half decade,” he said.