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Business

Toy Industry Relies on Parents' Generosity to Escape Recession

When toy manufacturers unveil the new playthings of 2010 this week at the Nuremberg Toy Fair in Germany, many will be silently praying that the industry will be recession-proof.

Steiff teddy bears

Steiff teddy bears are a perennial favorite with parents

Even when money is tight and their jobs could be hanging by a thread, parents will have a difficult time saying no to crying children yelling, "Mommy, daddy, I want this!"

At least that's what toy manufactures are hoping.

"People reduce all sorts of other expenses before they cut spending on their children," observes Otto Umbach, chief buyer for a cooperative of German toyshops, Idee und Spiel, before the toy fair, which runs from Feb. 5 - 10.

The annual event is the top showcase in an industry that is dominated by Chinese manufacturers and which has gained most of its growth in recent years in emergent markets such as India and Brazil.

A total of 221 Chinese exhibitors will show goods at the fair, along with 116 US toymakers. Germany will have 876 exhibitors, but many of them are tiny companies with no significant world presence.

With world trade in trouble as an economic slump spreads round the globe, the industry is expected this year to focus on the tried and true -- dolls for girls and cars for boys -- while trying to gain an edge with new technologies and features.

German designer Luigi Colani presented a fuel cell toy car at the 2008 fair

German designer Luigi Colani presented a toy fuel cell car at the 2008 fair

Among technologies that look set to carve out new space this year is an advanced new type of remote control for radio-controlled toys. The controls use 2.4-gigahertz radio links, which are already common to connect computers with keyboards wirelessly and are more reliable than the earlier radio links used to steer toy trains and cars.

Manufacturers can build more lights and noises and other features into the toys, because the 2.4-gigahertz radio band can transmit more commands from the hand-held console to the toys, yet two or more remote controls do not interfere with one another.

Umbach said keeping it simple is a big part of what children expect and adults ask for. The industry slogan is "ready to run," meaning a toy helicopter, for example, can be unwrapped, switched on and immediately flown without any complicated setting up.

Barbie vs. Bratz

Amid so much advanced technology, Barbie, who turns 50 this year, is re-assuringly old-fashioned without a hint of frumpiness. The unnaturally skinny, blonde dress-up doll was launched at a New York toy fair in 1959.

Barbie doll in pink convertible

As she turns 50, Barbie's sales figures are disappointing

Its US manufacturer, Mattel, will be unveiling details of 50th birthday promotional offers in many countries of the world at the fair as it hopes to win back market share from MGA Entertainment's Bratz dolls, launched in 2001.

The Bratz line is in trouble after a US court in December ordered it removed from sale by this February and awarded Mattel $100 million in damages against MGA Entertainment for copyright infringement and breach of contract.

MGA Entertainment is appealing and says on its Web site that it has won a stay till the end of this year in the court order, so "that business is back to normal with Bratz for 2009."

Both series of glamour dolls have been assailed by feminists and supporters of family values, but toy retailers say little girls remain in love with the toys, devoting hours to dressing them and combing their hair.

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