At a press event at the Best Buy in Union Square in New York City this morning, executives from Panasonic, Best Buy, DirecTV and 20th Century Fox revealed their plans to roll out 3DTVs and related accessory products and content. The campaign will feature fairly aggressive pricing, a big promotional effort and a consumer education campaign.
Senior Analyst and Editor
for Insight Media
While the media event had impact, many of the details had already leaked out prior to the event. And, Samsung hastily scheduled their big 3DTV launch event one day prior to grab more media attention (they didn’t invite us to this event, however).
On display at the Panasonic event was a 50" PDP 3DTV (TC-P50VT20) connected to a new 3D capable Blu-ray player (DMP-BDT350) and Panasonic’s own active shutter glasses. The price of the TV will be $2,499 and will include one pair of shutter glasses. Additional glasses will be available for $149. Panasonic’s Blu-ray player (BDT300 3D — an exclusive Best Buy model that is the equivalent of the BDT350) will sell for $399. The bundle of TV, glasses and player can be purchased for $2,899. At the event, Best Buy made its first sale to a hand-selected consumer.
This pricing is considerably lower than the announced domestic Japanese pricing of ¥430,000 ($4,813) for the same set. But Panasonic really has no choice but to lower the price in the US as Samsung has already started accepting pre-orders for its 46" 3D LCD TV for about the same $2,500 price point. Vizio also announced a 47" 3D LCD TV that it will launch this Fall for about $2,000. So, the pricing will be at the high end of the range, but not at a huge premium for consumers to pay.
Additional screen sizes at 54", 58" and 65" will come later, but as one executive told us, "we want to focus on mass production and high volume for the 50-inch to start."
Panasonic also restated its goal to sell 1 million 3DTVs worldwide by March 31, 2011, with half of those sales coming in the US in calendar year 2010. In our recently issued 3DTV Forecast report, we forecast in seven different regions on a calendar year basis. For the US & Canada region, we see about 320K 3D PDP TVs being sold in 2010, which Panasonic officials thought was "low".
Panasonic’s Bob Perry likened the transition to 3D as very similar to the HD transition, "but it will happen a lot faster." We are not so sure of that for a number of reasons, which is why we are being more cautious in our forecasting.
3D is a kind of a "bet the farm" strategy for Panasonic, as it needs to find a way to reverse its TV sales losses and keep the PDP category viable. The company has lost money on TVs for the last two fiscal years, but executives think the cost cutting and 3D emphasis will turn the business profitable in the current fiscal year. We’ll see.
Best Buy says it will have special dedicated demonstration areas in about 400 of their Best Buy stores that have Magnolia Home Theater set-ups. Best Buy is doing this to help ensure that they have trained and effective sale people who can create a good first impression with consumers. Over time, the models will expand onto the regular sales floor in the additional 700 Best Buy stores.
The event also featured speakers from DirecTV and 20th Century Fox. Fox’s EVP Mary Daily said that they will roll out Ice Age: Dawn of the Dinosaurs as their first 3D Blu-ray title and will do a bundling deal with a Panasonic 3DTV, but details were not yet available. DirecTV reiterated their plans to offer 3 channels of 3D content. In response to a question about getting ESPN 3D on one of those channels by June, the spokesman said only, "we’ll see."
In addition, on March 15th, Panasonic plans to expand it 3D truck tour covering 15 major markets. The tour will have three caravans simultaneously traveling on the East and West Coasts and Central U.S., beginning in New York, Los Angeles and Chicago.
It is also important to note that the sale of a 3DTV does not mean that the TV will be used for 3D. For example, buyers will seek out and purchase sets because they are the top of the line; they have the best black level or no color shift; they have ultra-thin profiles; they have a wide color gamut from LED backlights; or they offer Internet connectivity, widgets or Skype capabilities. Most sets with some or all of these features will also be 3D capable, so it is hard to say which feature will actually sell the TV.
Regardless of the reason, the result will be an increasing installed base of 3DTVs. This will create the incentive that 3D content creators and delivery system operators need to invest in 3D products and services.
In addition, it is clear that we are seeing the opening salvos in a marketing campaign around 3DTV. Samsung and Panasonic will be very aggressive and we expect Sony to follow suit. So, what about Vizio, Toshiba, Sharp, LG and Philips? Will they be content to let these three slug it out in the early going and ride the coattails of the effort, or will they also raise war chests and join the battle? Either way, it will be interesting to watch.