Those of us believe the news of plasma’s death has been exaggerated received support yesterday when Quixel Research released its Plasma TV Market Review for Q4 2006, which reported that 40-inch and larger plasma-TVs outsold microdisplay rear-projection and LCD-TV sets of similar size in both units and value last year.

Ken Werner
Senior Analyst and Editor

Plasma-TV unit sales grew 83% from 2005 to 2006, and dollar volume grew 32% from $5.3B to $7.1B.

Quixel principal Tamaryn Pratt observed, "Manufacturers and retailers enabled price declines that opened the doors for a new set of customers. The aggregate price-per-inch fell significantly for the second quarter in a row, dropping below $39 in the fourth quarter. Consumers were able to purchase premium-branded 42-inch HD PDPs as low as $999 over the holiday selling season and that price point kept the other technologies at bay.

"On a quarter-to-quarter basis the severe price cuts suppressed revenue growth in the fourth quarter and the total market value declined 12% from Q3 to Q4′06, or decreased from $2.1B to $1.8B respectively," she continued. " On a year-to-year basis, however, plasma-TV revenues were up 2% from Q4′05 to Q4′06, and up 66% in volume for the same time period."

The total value of the advanced TV market in the United States was worth almost $24B in revenues in 2006, Pratt said, and the plasma-TV segment accounted for nearly 30% of it. Quixel is forecasting the volume of plasma-TV sales in the U.S. to double from 2006 to 2010.

Having said that, LCD is certainly taking a larger share of the flat-panel market at 40 inches and above as time goes on. We can quibble about details, but LCD- and PDP-TV images both look very good these days on first-tier (and many second-tier) sets. In the 40-inch class, LCD can offer full HD (1080p), which PDP can’t. This is not going to matter at all to most consumers once they get the set home, but it’s a potent differentiator on the sales floor. Plasma, on the other hand, still does better with rapidly moving images, whereas MDTV offers the best price-per-inch.

In this size range, price will be the key, and the prices of 42-inch plasma and LCD TVs are currently within a hair’s breadth of each other. Plasma makers are fond of saying that their technology is far less mature than LCD and there is much more potential for cost reduction. Indeed, the plasma panel makers pulled some pretty good rabbits out of their corporate hats in the last year, including single-sided driving and film-based front filters. If any more cost-reducing rabbits are reaching the end of their gestation period, this would be a good time to bring them forth.

Lacking the buzz of LCD, plasma needs more than just price parity to win back some market share in the 40-inch class. Or it needs to generate buzz of its own. It wasn’t long ago that "plasma" was synonymous with flat-panel television. What happened? Can plasma get its groove back? Maybe. But that’s another story, and you can read about it in the next Projection Monthly with Flat Panel Coverage.