Guess What Santa Brought this Year

With 2018 counting down fast, I wondered what the yearly display industry highlights were for 2018.

As we all know by now, VR is still struggling with reaching the high expectations the electronics industry had for this new market segment. At the current time, the AR / VR market is kind of a disappointment from the perspective of the ‘next big thing’, but nevertheless, there was a slight uptick in the VR market towards the end of 2018. While the view of the market was very diverse depending on which market research firm you were following, they seem to agree that the standalone form factor is more likely to convince the consumer than tethered systems.

As we can see, the March 2018 forecast from Business Insider is still showing good growth for the VR headset market in 2018 and going forward even though the overall numbers were somewhat smaller than earlier forecasts. They said the VR headset shipments would grow to about 15 million units in 2018.

BI VR market forecastBI VR Market Forecast

Adding up the tally for 2018, IDC is now saying that after quarters of decline, the third quarter was finally showing growth for the AR / VR headset segments. Since the fourth quarter numbers are not available yet, 2018 could still end up as a down year overall. That is a possibility that CCS is already adopting in its most recent market forecast, even though they are still more aggressive in their multiyear forecast.

CCS Insight AR VR shipmentsCCS Insight AR VR shipments

In other markets, we do see some surprises in display-centric devices over the holiday season. Amazon just published a list of the most successful devices for sales this holiday season. As somewhat of a surprise, the top spot for electronic devices was taken by wireless headphones followed by the Samsung 65” 4K UHD Smart LED TV and the Apple iPad in third place.

While Samsung did not say how many they actually shipped, it shows that the 4K TV market is actually catching on with consumers in a big way. Even with the content bottleneck to deal with the feature is catching the interest of the consumer. The other aspect is the TV size itself. Consumers seem to be more interested in larger TVs, a trend that has continued over the years. I remember arguments about what the optimal size is for a typical living room setting, with projection systems covering the larger sizes above 50″. This is all history by now. The real question is what TV size will be the ultimate winner in the race to the biggest TV fitting in a living room?

Samsung 65 4K UHD Smart LED TVSamsung 65 4K UHD Smart LED TV Series 8

The other side of the large TV market are the falling prices that enable this large TV boom. I remember when 50” TVs cost over $2,000 and now you can get the Samsung Series 8 65” Smart TV for $1,200. There are even 65” Samsung TVs available for under $700 if you chose a cheaper alternative, so there is no real need to look at other low cost brands for good value.

Another interesting product was the Nintendo Switch, a standalone / console gaming system with 6.2” touch screen that was expected to be a big winner in the holiday season. Interestingly, the Switch was released in 2017 and is by no means a new device. As a consequence sales were driven by price breaks given through hardware bundles including games. It appears that the Switch is on track to beat the lifetime sales of the PS4 and the 3DS in coming years. From a global perspective it is a great hit in Japan where it has now outsold the PS4 already.

Nintendo Switch

What makes this WiiU successor so successful? It seems to provide a step up from smartphone gaming with better performance (still short of a real gaming console) but allowing multiplayer games without using the family TV, even though it can do that to. This is a better fit to the mobile lifestyle than the typical gaming console ever was.

As it seems, electronic gadgets with displays are more common again and the graze of the display less smart devices seems to slow down. That maybe a good sign for the display industry in the coming year. NH

Analyst Comment

When some of my family visit, they bring the Switch to keep the youngsters entertained and it does a very good job and seems to work well with a wide variety of ages. We have a PS3, but the Switch is at least as popular. (BR)