Today’s column will be my last Display Daily after nearly eight years of ruminating about this wacky, weird business we know as the display industry.
Along the way, I’ve written about topics as diverse as 3D, digital terrestrial broadcasting, Blu-ray, streaming video, OLEDs, IGZO, the rise and fall of plasma, video codecs, and the ongoing financial struggles of certain Japanese companies as first Korean and then Chinese manufacturers have undermined their business models.
Despite the ups and downs, there have been some consistent trends along the way. Starting way back in the mid-1990s, we’ve seen display screens get steadily larger as prices fell and resolution increased. In the late 1990s, a 50-inch plasma TV with 768p resolution would set you back upwards of $20,000.
Two years ago, the first 84-inch Ultra HD TVs to land on these shores were similarly priced. 50-inch 768p plasma TVs no longer existed, and most flat screen models had migrated to 1080p resolution. By the end of this year, there will be no more plasma TV manufacturing at all, a development no one could have predicted back in 1997.
The fact is; the majority of consumer display products are now commodities. Scanning prices from late November through the Christmas selling season reveals that 32-inch LCD televisions can be had for as little as $150, while 55-inch sets have dipped as low as $480. Over Black Friday weekend, Samsung and LG both had 4K TVs priced between $750 and $900, and you can expect that level of discounting to continue in the three weeks leading up to the Super Bowl. Remarkable!
The television business can be and has been cruel to some manufacturers. It was responsible for some of the record-setting financial losses incurred by Panasonic, Sharp, and Sony over the past five years. Pioneer had to drop out to stay viable, as did Hitachi and Mitsubishi. And Toshiba has largely withdrawn from the US television business to concentrate on other markets.
While Panasonic has turned profitable again after shutting down their plasma manufacturing operations, Sharp continues to skate along the edge as their worldwide market share evaporates. Sony, which hasn’t made a dime in the LCD TV business to date, will once again report disappointing financial results in March of 2015, largely due to their mobile phone operations but aided and abetted by the TV business unit.
In the meantime, Samsung and LG continue to look over their shoulders at the oncoming crop of Chinese TV brands. And it’s much the same way in the mobile phone business: China is becoming a powerhouse domestically, resulting in disappointing 3rd quarter results for Samsung. Sony’s mobile phone business unit has become a major cash drain on the company and might find itself a casualty by the end of 2015.
When you’re struggling to sell televisions, phones, and tablets, it’s an easy to decision to slow down or stop R&D on next-generation technologies. Panasonic and Sony both cut back on OLED R&D after showing some impressive 56-inch prototypes two years ago. Samsung’s curved 55-inch 2K OLED quietly disappeared from the market earlier this year after a much-ballyhooed launch in the fall of 2013. Was it low yields? Pricing? (Probably a combination of both.)
The big news for 2015 will be whether the stronger Chinese brands like TCL and Hisense can gain a foothold in the U.S. market. TCL is making all the right moves – they bought an old Sanyo maquiladora LCD TV factory in Tijuana, Mexico earlier this year and are now selling Sanyo and RCA-branded TVs in U.S. chain stores. TCL has also started building televisions with QD Vision’s quantum dot technology and selling them in China. How long before we see similar models on these shores?
Another value-priced competitor, Vizio, launched a line of five P-series Ultra HD TVs this past September and is already aggressively discounting them by as much as 30%. It helped them immensely to gain a foothold in Best Buy, since they already have a high degree of brand recognition and acceptance among U.S. consumers. Will Vizio’s success help lesser-known Chinese brands like TCL and Hisense gain favor?
We do know from research done by Nielsen and other firms that Americans aren’t all that motivated by 3D and Smart TV functions. They simply want big, cheap televisions. Paul Gagnon’s NPD DisplaySearch blog for Black Friday talks about 40” and larger TVs flying off the shelves while boxes of 32-inch models sat gathering dust.
Anecdotal evidence from friends and industry colleagues tells much the same tale, with upgrades to 50-inch, 55-inch, and even 65-inch sets happening over this holiday season. (Even a few Ultra HD sets were bought by associates because of aggressive pricing, even though they have no way currently to access 4K content!)
Next month’s International CES and the pre-Super Bowl selling season will tell all and reveal some more surprising discounts as the transition from 2K (1080p) to 4K gets underway. (Yes, history is repeating itself –as we moved from 720p to 1080p, so shall we move to 2160p!)
I’ll wind things up with a look into my liquid-crystal ball. (Disclaimer: You may not see all these predictions take place by the end of 2015!)
- Sony will finally announce plans to sell off its television business and follow Sharp’s lead in licensing its name to a Chinese/Taiwanese manufacturer of TVs
- Sharp will migrate exclusively to 4K resolution in large LCD TV sizes
- Samsung will shift more of its focus to creating and delivering 2K and 4K content for TV consumers as its TV market share peaks
- Panasonic will be the next major brand to phase out television sales in the U.S.
- More Chinese mobile phone brands will gain acceptance in North America
- Netflix will start to appear as a branded channel on pay TV systems, even though it is streamed exclusively
- We will see a marked uptick in support for DisplayPort among computer and Ultra HDTV manufacturers, now that version 1.3 has launched, royalty-free
- Phablets (5” and larger smartphones) will become commonplace at the expense of tablet sales, accelerating a trend that started midway through 2014
- The adoption of quantum dot backlights will increase by several magnitudes in 2015
- More consumers will “cut the cord” and watch TV using broadband connections
- Completely wireless notebook computers (Bluetooth, Wi-Fi, wireless display connectivity) will make an appearance in 2015
- The Chicago Cubs will once again not make it to the World Series
Well, gotta go…