LAS VEGAS--The recession had a starring role at this year's Consumer Electronics Show.

The annual homage to gadgets was devoid of blockbuster announcements or over-the-top products it's known for, like the 150-inch TV introduced at last year's event that seemed designed for shock value rather than the living room. Instead, the recession infused just about every product announcement, speaker session

A day before the show officially began, the usual day-long marathon of press conferences by major Asian consumer electronics makers all had the same somber choreography: each began with executives acknowledging the souring economic times and the challenges they faced as a result, followed by a new array of products for these austere economic times.

Meanwhile, crowds were markedly thinner at this year's CES, which most likely means a third consecutive year of lower overall attendance. The number of exhibitors was down by about 300.

This had a surreal effect for CES veterans: readily available cabs and shuttle busses. In years past, the show has been so jam-packed, cab and shuttle bus lines stretched for a few football fields, and the wait could be an hour or more. On the first day of the show, usually the height of the madness, catching a cab meant waiting about five minutes, and empty shuttle busses lined up awaiting passengers.

The recession's impact on consumer electronics spending also hung over just about everything. Case in point: Gary Shapiro, who heads the Consumer Electronics Association, which hosts the show, kicked things off with a cold shower of an address in which he said spending on electronic gadgets will dip dramatically this year.

Academy-award winning actor Tom Hanks took the stage next to kick off the keynote address by Sony Corp (SNE) Chief Executive Officer Howard Stringer. "Gary Shapiro: way to serve up a hell of a cup of coffee," Hanks said. "That was rousing."

Microsoft's (MSFT) Steve Ballmer's keynote address Wednesday night bordered on a dirge at times.

When two ailing companies can create the biggest splash at a major consumer electronics show, you know things have changed drastically. Yahoo Inc. (YHOO) and Palm Inc. (PALM) managed to rise head and shoulders above the thousands of others at the show with some new products. For Palm, it was their new Pre phone, which helped double their shares price in two days. Yahoo and its widget engine for TVs also played a starring role.

But there was one notable exception in John Chambers, chief executive officer of Cisco Systems Inc. (CSCO).

Chambers is a favorite speaker at CES because of his unbridled enthusiasm. This year was no different. On the same day that it was announced that U.S. unemployment had reached a 63 year high, Chambers spent an energetic hour on stage painting an upbeat picture for technology going forward. In this year's rendition, he focused on the company's new emphasis on making consumer products.

Some could interpret that move as Cisco searching for new markets to drive sales in a downturn that's choking off business IT spending, which is Cisco's sweet spot. But one wouldn't know that from Chambers keynote address.

He mentioned the recession once, and put his usual positive spin on it. During the last few downturns, Cisco increased its market share each time, Chambers noted.

"I'm more optimistic than most people in this room," he said amid a scrum of well-wishers after his address.

-By Ben Charny, Dow Jones Newswires; 415-765-8230; ben.charny@dowjones.com

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