“The consumer technology market in 2025 will become more complex with various innovations. At the same time, consumer spending on hardware devices and services will slow, and to overcome this, the consumer electronics industry must shift to a business model centered on AI capabilities and services, seeking to differentiate products, generate additional revenue, and improve profitability.

Omdia and Canalys recently released a report titled “Consumer Technology Trends 2025 at a Glance,” predicting that the consumer technology market in 2025 will be reorganized around diversification of monetization strategies, integration of AI and services, and strategic partnerships.

The report highlights the key challenges: First, innovative value exchange models are essential to generate stable revenue even amidst slowing consumer spending.

Manufacturers and service providers are facing limitations in relying solely on hardware sales, and are being urged to adopt diversified monetization strategies that combine advertising-based, freemium, and subscription models.

AVOD (ad-supported video on demand), FAST (free ad-supported streaming TV), social video, retail media, and shoppable TV were identified as areas with growth potential.

In the media and entertainment sector, the emergence of a 'super hybrid' platform is expected.

Convergence services combining subscriptions, advertising, live sports and events, and VOD (video-on-demand) content are expected to take the lead, and Netflix, YouTube, Disney+, TV operators, and FAST platforms are expanding their ecosystems by absorbing each other's strengths.

The visualization of podcasts and game content, combined with shoppable content, is expected to establish itself as a win-win structure where creators and brands seek mutual benefit.

In the gaming market The gap between success and failure in live games is expected to widen further.

With long-running services like Fortnite and League of Legends maintaining a solid user base, GTA 6, slated for a second half of 2025, is likely to spark a massive immersion phenomenon.

On the other hand, live games that fail to overcome technical complexity and commercial risks are likely to face pressure to be eliminated.

Next, strategic alliances and bundling are the trend to remove market entry barriers and gain a competitive edge.

Online video platforms are expanding their subscriber pools by partnering with telecom companies, broadband providers, pay TV providers, banks, credit card companies, and consumer goods brands.

In the connected TV (OS) space, cooperation with retailers to secure in-store and online distribution channels is key amid competition among dozens of operating systems.

M&A between suppliers and platforms, as well as HDMI streaming dongle entry strategies, are also noteworthy changes.

Finally, AI is evolving from a fad to a force that creates real value.

Smartphone and PC manufacturers plan to increase the proportion of AI features installed in their devices to one-third and two-fifths of their shipments, respectively, by 2025.

On the other hand, it is still unclear what AI features consumers will be willing to pay for.

The media sector is expected to see widespread experimentation with AI, including automating content creation, dubbing, and subtitling, shortening game development cycles, and establishing ethical partnerships with music companies.

The wearable device market is experiencing intensifying competition for specialization and personalization.

Smartwatch, fitness band, and ring manufacturers are introducing medical-grade sensors, AI coaching features, Target premium customers based on personalized health and sports indicators.

On the other hand, in the smart home sector, the shift to subscription-based services is accelerating.

After experiencing the growing pains of cloud costs and consumer resistance, companies like Ring and Blink have taken the first steps toward improving profitability with recurring revenue models.

The report emphasized that “in order for companies to respond to challenges in the rapidly changing market of 2025, they must adopt innovative technologies, redesign value exchange models, and build strategic partnerships.”

This explains how we can maximize profit generation and minimize risk, thereby ensuring sustainable growth and resilience.

“In a hardware slowdown, a combination of services, AI, and partnership strategies will determine the winner,” said Nicole Peng, senior analyst for Omdia’s consumer technology market. “Companies that seize the trend will change the market landscape.”