E-Cigarette Sales to Hit $1 Billion

July 31, 2013 -- E-cigarettes—a relative novelty three years ago--are about to hit $1 billion in sales, according to Wells Fargo securities analysts.

While that's only 1 percent of sales of traditional cigarettes, the number of consumers who say they've tried e-smokes is growing fast. The sale of e-cigarettes totaled just $500 million last year.

According to the most recent survey by the Centers For Disease Control and Prevention, in 2011 about 21 percent of adults who smoke traditional cigarettes said they had tried the electronic alternative, up from about 10 percent in 2010.

"Overall," says a CDC press release, "about 6 percent of all adults have tried e-cigarettes, with estimates nearly doubling from 2010."

"E-cigarette use is growing rapidly," said CDC director Tom Frieden in a February 2013 release announcing the survey's findings. "There is still we do not know about these products."

E-cigarettes, in their most popular form, look like conventional tobacco cigarettes. They do not, however, contain leaf tobacco and they do not burn. As described by CDC, they are battery-powered devices that provide inhaled doses of nicotine vapor and flavorings. Because they do not burn and do not produce smoke, their advocates consider them more socially acceptable than traditional cigarettes.

Their detractors do not. The Long Island Rail Road declared earlier this month that e-cigarettes violate LIRR's smoking ban, which declares it unlawful for railroad patrons to "burn a lighted cigarette, cigar, pipe or any other matter or substance which contains tobacco or any tobacco substitute."

SAFER SMOKE OR NEW BAD HABIT?

In the eyes of some, the mere appearance of someone smoking—even smoking a non-tobacco, electronic substitute—creates the dangerous impression that smoking is okay.

"The use of e-cigarettes in public areas in which cigarette smoking is prohibited could counter the effectiveness of [smoke-free compliance] policies by complicating enforcement and giving the appearance that smoking is acceptable," the CDC report says.

Gregory Conley, legislative director at the Consumer Advocates for Smoke-Free Alternatives Association, scoffs at that attitude, saying, "It looks like smoking…so it must be evil."

Conley's association, he says, represents some 5,000 e-cigarette users. Conley says e-cigarettes "annoy people who don't understand that they're a great advertisement for smoking-cessation" and "people who believe no one should be allowed to have nicotine in any form."

NO PROOF E-CIGARETTES COMBAT ADDICTION

The question whether e-cigarettes can be viewed as an aide to quitting smoking, for conventional tobacco users, is a contentious one. Eli Alelov, CEO of LOGIC Technology, makers of LOGIC e-cigarettes, says e-cigarettes are not a health product, and that he's not claiming they are. At the same time, however, he points out, an e-cigarette contains no tar and no tobacco. It produces no second-hand smoke. Regulations prevent his suggesting that his product is healthier or safer, he says. "So, we leave that up to the public: they can use their logic."

Alelov says that the people who hate e-cigarettes most include both big tobacco and the tax man. E-cigarettes aren't taxed the same as regular cigarettes, so "the states hate us, because they're losing money," Alelov said.