Recession - decline at CeBIT

CeBIT sees sharp decline in vendors

CeBIT, Europe's largest IT fair, will see its lowest number of exhibitors in a decade as companies slash marketing expenditures because of the global recession.

Deutsche Messe, which runs the event, is expecting 4,300 companies from 69 nations. That's down more than 26% from 2008, when 5,845 companies participated.

The figures mark a multiyear downturn for CeBIT, which uses aircraft-hanger size halls on enormous fairgrounds in Hannover, Germany. In 2006, CeBIT had 6,262 exhibitors, and in 2001 had as many as 8,000 exhibitors. The show runs from March 3 through March 8.

The largest drop-off in attendance is coming from vendors in countries such as China, Taiwan and South Korea, said Sven Prüser, senior vice president at Deutsche Messe, who is responsible for CeBIT events worldwide.

"A lot of these smaller companies have closed down," Prüser said.

About 200,000 square meters of floor space has been sold this year compared to 240,000 square meters last year. CeBIT has also been affected by competing European trade shows such as Internationale Funkausstellung (IFA), a consumer electronics show held in Berlin in August, and Mobile World Congress, formerly 3GSM, the world's largest show focused on mobile communications now held in Barcelona in February.

In recent years, Deutsche Messe has sought to portray CeBIT as focused on businesses rather than consumers. The show has in past years drawn as many as 200,000 visitors in the first three days or so, mostly Germans. So far this year, preregistrations by journalists and visitors have been about the same as last year, Prüser said.

Deutsche Messe is spinning the all-time low number of exhibitors as still remarkable considering the tech industry has been hit hard by waves of layoffs, mediocre financial reports, and slowing demand for enterprise software and consumer products.

In an effort to attract exhibitors, for the first time this year Deutsche Messe partnered with German airline Lufthansa to sell flight tickets to foreign visitors at up to a 20% discount. The discount only applies to companies or people who do not already have a discount arrangement with an airline.

Also, Deutsche Messe has seen an increasing number of smaller companies take advantage of prepackaged display stands, which can reduce a company costs for a display by as much as 50%, Prüser said. The costs of renting floor space, however, has not been discounted, he said.

The prepackaged stands mean that companies don't have to ship material. It's not just small companies that like the idea: Big vendors such as Brother are buying the packages this year, Prüser said.

Deutsche Messe said about 300 companies are rejoining the trade show after passing on it in the past. Of the 4,300 companies exhibiting, 200 are new this year.

German Chancellor Angela Merkel will open the show once again on Monday night, and other notable people will be on the scene during the show.

California Gov. Arnold Schwarzenegger will visit on Tuesday as part of a "Partner State California" display in Hall 6, highlighting U.S. companies and technology. In past years, CeBIT had put a spotlight on countries such as France or Russia. It's the first time a U.S. state has been substituted for a country, Prüser said.

A key theme of CeBIT this year will be Web 2.0 technologies, such as blogging, social networking, unified communications and cloud computing; it will be in Hall 6 under the theme "Webciety." CeBIT will also have a green IT section that is five times larger than last year, showing the growing interest by companies in reducing energy costs, Prüser said.