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Arnold M. Knightly

Attendance for Vegas electronics convention to remain flat

4 January 2010

LAS VEGAS, Nevada -- Flat is good when it comes to Las Vegas' hard-hit convention business.

Officials involved with the annual International Consumer Electronics Show are predicting attendance and local economic impact numbers will be similar to last year's when the show begins Thursday, and they're fine with that.

Gary Shapiro, president and chief executive officer of the Consumer Electronics Association, which stages the show, predicted Tuesday that CES' attendance will be close to the 113,000 people it drew last year, give or take 5,000.

"We held the last show last year in the middle of economic uncertainty," Shapiro said. "Frankly, I think there's a lot more optimism right now. Last year there was a lot of fear, this year there's more opportunity."

The largest annual convention to Las Vegas runs through Sunday.

This year's expo will again use nearly 2 million square feet of exhibit space at the Las Vegas Convention Center, 200,000 square feet and the showroom at the Las Vegas Hilton and conference and meeting space at The Venetian.

The Las Vegas Convention and Visitors Authority is projecting 110,000 attendees and a projected economic impact to Las Vegas of $172.9 million, a 2.7 percent decrease from the $177.8 million economic impact attributed to last year's show.

The flat numbers would be welcome to a local convention industry that had attendance drop 25.7 percent between last January and October with 16,378 fewer meetings and conventions held during that time.

Attendance forecasting is an uncertain science, Shapiro said. Last year he projected nearly 130,000 attendees because he didn't fully appreciate how the struggling economy would affect attendance.

Although attendance at CES is down sharply from its peak of 152,203 attendees in 2006, Shapiro said the show's directors decided last January they wanted to keep attendance numbers close to those from last year.

Industry officials and conventioneers have complained in recent years that CES has grown too big. The show's real focus -- making business deals and introducing new technologies -- was getting muddled because the show's owners were focusing too much on raising attendance, attracting more exhibitors and collecting more revenue.

One of the first moves toward condensing CES was the announcement in July that the show would no longer use 108,850 square feet of space at the Sands Expo and Convention Center.

Keynote speeches have been moved to the Las Vegas Hilton this year. Speeches will include a state-of-the-industry address by Shapiro, and talks by the chief executive officers of Ford Motor Co., Microsoft Corp., Intel Corp. and Qualcomm Inc.

Las Vegas Sands Corp. Vice President of Communications Ron Reese said that although the Sands Expo space is no longer being used for CES, the show remains a major annual event for The Venetian.

"From the show itself, and the long history with attendees staying and using the facilities, it's still impactful," Reese said. "Frankly, we still have a lot of the show."

The Venetian will host more than 200 audio exhibitors.

Although CES' organizers have increased some pricing, Shapiro said they have worked to control attendance by scrutinizing attendees from Las Vegas more carefully to make sure they are part of the industry or legitimate media.

"We've definitely kicked back more applications to attend than we have in the past to try to keep that number low," Shapiro said.

Even with the increased scrutiny, more than 4,000 press credentials have been issued, and more than 25,000 international attendees and delegations from 50 foreign countries are expected to attend.

Shapiro said all of the major television networks will broadcast their morning shows live from the event, and NBC will have extensive coverage with NBC Nightly News and reports from MSNBC's business correspondent Maria Bartiromo.

Nearly 330 new companies will exhibit this year, including 100 companies that make accessories for Apple products in a new iLounge.

Many companies that sat out last year because of the economic uncertainty are also returning, Shapiro said, including JVC, Philips, Sanyo and Best Buy.

While the rebounding economy has helped rightsize this year's show, the downturn has also helped address another challenge that threatened the show's viability in years past: room rates. Shapiro said he made special trips to Las Vegas from his office in Arlington, Va., to discuss containing rising hotel room rates, which were near New Year's Eve levels, before the economy did the work for him.

"We were the first show of any serious type to come to Las Vegas when we moved there in the late '70s," Shapiro said. "Part of the sell is that it was cheaper and you could do business there. We've been the strongest, loyalest and the largest. Increasing hotel prices were threatening the viability of the show."

At The Venetian and its sister property the Palazzo all 7,100 rooms are sold out Thursday night, with rooms available Friday ranging from $669 to $1,929 for a concierge suite.

The rates drop back to $159 to $329 on Sunday.

Gavin Mealiffe, vice president of sales for the 3,000-room Las Vegas Hilton, said Wednesday that room sales started slow but have accelerated the last month.

Mealiffe expects to rent all his hotel rooms through Saturday by the time the show arrives at prices slightly higher than last year.

"This year we were very, very pleased given what's happened all year," Mealiffe said. "After the lack of demand we saw last year over CES it's kind of nice to see it picking up again."

Las Vegas Hilton room rates jump from $45.95 for a basic room on Tuesday to $290 on Wednesday and $479 on Thursday. Prices for other rooms range from $510 to $679 on Thursday, then gradually decrease before settling in at regular rates on Sunday.

Other hotels close to, but not affiliated with, the convention also appear to be benefiting.

Wynn Las Vegas and its sister property Encore are sold out Thursday, but have a limited number of rooms available Friday and Saturday.

Midmarket hotels not affiliated with the show but close to the convention center and Las Vegas Hilton are also positioned to benefit.

The Sahara is offering rooms for $110 per night Thursday and Friday, and $73 on Saturday, up from its regular rate of $30 on Thursday and $64 on the weekend. The Riviera is sold out Thursday and Friday.

Shapiro said he hopes CES kick-starts a better year for Las Vegas' convention business.

"The good thing about the CES this year is it will give a good, optimistic start to the new year for Las Vegas, for the tech world and for the economy," he said. "And we'll fill many hotel rooms, which is very important."