CEDIA Expo, the high-end home theater show, just concluded its four-day run in Denver. It’s come a long way since its inception in 1989 - perhaps so far that it’s not really a high-end show anymore. In fact, it’s hard to say what kind of show CEDIA has become these days.
As I walked the aisles and checked out the plethora of front projectors, rear projection microdisplay HDTVs, and plasma and LCD HDTVs, I had to wonder: What were all of these non-CEDIA channel products doing here?
Need examples? How about Mitsubishi’s new HC5000BL home theater projector, a breakthrough 1920×1080 HTPS LCD design for $4,495? Not a CEDIA channel product. Sharp’s LC-52D62U 52-inch 1080p LCD HDTV ($4,799)? Nope, that’s a big box display.
Panasonic’s 1080p HTPS PT-AE1000U projector? No fixed price yet, but it will be competitive with the Mitsubishi (and other) offerings and offered through the same channels. JVC’s 70-inch HD-70FN97 1080p D-ILA RPTV? Check it out at Best Buy for $5,499. Toshiba’s new HD-A2 HD DVD player? Sears will have it for $499.
Most of what I saw in the Samsung booth will be retailed through brick and mortar stores, not custom dealers. Ditto LG, JVC, Toshiba, Epson, Hitachi, and Sony. To be fair, a custom installation dealer will be able to pick up these products too - but through distributors such as Electrograph, Stampede, IAVI, and AVAD, not factory direct.
On the other hand, I heard many reasons why so many of these products were seen at CEDIA. One theory was that the second projector in a custom HT installation would be a low-price model. At least, that’s the explanation offered by InFocus for their new 1280×720 IN78EX DLP projector ($4,500).
Other manufacturers poo-poohed that idea, saying instead that flat-panel HD displays would be the popular choice for second and even third screens as part of a custom installation, a theory that makes much more sense. Yet another camp offered the opinion that CEDIA Expo has evolved into a "mini" CES and a must-attend for press coverage of fall line offerings.
Compared to the clubby, cliquey atmosphere of my first visit to the show in 1996, this year’s edition felt more like a cross between InfoComm and CES. (In fact, some CEDIA manufacturers brought along versions of their InfoComm booths.) Many exhibitors expressed their displeasure with how big and unwieldy the January CES show has become, preferring the lower-key atmosphere of CEDIA for conducting business.
The fact is; HDTV has become a channel product, with market share and price wars taking precedence over resolution and performance. That’s good news for consumers, but not so good for home theater installers.
Need proof? Mitsubishi’s decision to use Epson HTPS LCD panels to get to 1080p at a low price point is a pure channel strategy, and nothing else. Otherwise, they’d have stayed with the DLP imaging technology used in their 720p offerings. Sony’s new VPL-VW50 1080p LCOS projector has a price point of $5K, and is another channel play. JVC’s new, lower prices on all of their D-ILA projectors are a direct result of distributor pricing demands.
To be sure, there are a few brands that continue to offer high-priced products for home theater dealers, such as Seleco/SIM2, Runco, projectiondesign, Fujitsu, and Digital Projection. Fujitsu’s new line of Aviamo plasma and LCD HDTVs is a perfect example, with SRPs of $7,000, $15,000, and $20,000 for 37-inch, 50-inch, and 65-inch screens, respectively.
To contrast, Sharp’s new 42-inch 1080p LCD HDTV will retail in big box stores at $2,495, while Panasonic has placed an SRP of $9,995 on its TH-65PX600U 65-inch plasma HDTV (the same product that Fujitsu is OEMing for its $20K Aviamo version).
Here’s a question to ponder: Does the traditional HT customer simply continue to write a blank check to a CEDIA integrator for these products, or are those customers becoming more price-savvy, thanks to the Internet? Postings on the AVS Forum indicate that there are thousands of home theater enthusiasts who are shopping aggressively for the best price while building some serious home theaters.
Some HT integrators I know have told their customers to buy their big screen RPTV or plasma sets from Best Buy and the integrator will just install it as part of a bigger job. Others have said they pass these products along with no markup - or even at a slight loss - just to keep the rest of the installation profits.
What impact will Best Buy’s Magnolia home theater division have on the market? How about Circuit City’s Firedog custom installation services, announced earlier this month? Theater Extreme (http://theaterxtreme.com/), a 20-location mass-market home theater installer on the east coast, claims to offer custom installs for as low as $2,999, and makes no bones about aggressively competing with small custom HT integrators.
It’s clear that the small, custom HT integrator is going to be hard-pressed to stay in business as a combination of mass distribution, plug-and-play products, and national chains of HT integrators enter the marketplace.
And while CEDIA Expo is in no danger of fading away (a favorable spot on the calendar ensures that), it is clearly becoming a generic home entertainment show with a custom installation component.
The question remains - whose show is this, anyway?