What Display Daily thinks: Eh, someone should be pursuing predatory pricing strategies to soak up market share and driver competitors out of the business. Best way to get capacity and utilization rates to align. I really should do better job of titling these things. Seems like the whole point of the opinion is revealed too quickly.
But, this is what happens when you kind of have to deal with the slow pace of change in the panel manufacturing business.
Predatory pricing should be illegal. It’s a stacked deck. Chinese companies, and South Koreans, are benefiting from generous governments who seem to have a thing for panels and displays. It’s not a level playing and that’s why there are no real competitors outside of those two countries. No other government seems to take the industry that seriously.
But, predatory pricing isn’t illegal in this industry so, moot point.
What’s really at the heart of all of this is that the TV market is not going back to what it was. There is no future surge in TV buying or a second coming of couch potato-ism. Given that demand is going to lag capacity forever if these circumstances prevail, the ideal scenario now is someone going hard to cull the weaker manufacturers. It is very unlikely that we will see multi-billion investments in LCD TV panel manufacturing in the future so, all you are left with is the lot we have now.
And there’s too many of them. Someone has to try and soak up the market, carve out a bigger piece of the pie, and choke the supply. I suppose the analysis will get easier if that doesn’t happen; you just have to cut and paste your old analysis, pushing the lines down on your charts, rinse, repeat.
The TV market isn’t coming back. So, barring going all Conan on the market and crushing all your enemies before you, you are left with the option to redefine TV sets. Right now, they remain pretty much unchanged from CRTs, with the exception that you can hang them on a wall. It’s still the same screen on top of a cabinet or table, and everyone hunkering down around it to watch something or other.
I have observed kids, mine and those of many friends, and they don’t watch TV. At least not in the communal sense. It’s just another screen that they can switch back and forth from. The smartphone generation will just walk away from the bigger screen and go off somewhere to focus on the smaller handheld screen.
TV is for the olds. Just look at where the money for TV content is going below. The young are moving on, literally and figuratively.
Global SVOD revenues will increase by $116.6 billion by 2031, a growth rate of 13.3% per year over the next eight years, according to a new report from MIDiA Research. Cumulative revenue is expected to rise from $109.6 billion in 2024 to $226.2 billion in 2031.
MIDiA says the majority of this revenue growth will come from older consumers (so-called “silver streamers” 55+) reluctant to cancel subscriptions despite price increase.
TV Tech
LCD TV Panel Prices Stabilize Amid Soft Demand
DSCC is talking about a period of unusual stability in LCD TV panel prices, despite a short-lived rally and declining demand in the market, in a new blog post. According to the article by Bob Young, LCD TV panel prices experienced a modest uptick from February to May/June 2024, following a brief slump in Q4 2023. However, this rally is expected to come to an end in Q3 2024, as increased factory utilization rates and soft demand put downward pressure on prices.
DSCC attributes the initial price rally to low fab utilization rates in Q4 2023 and Q1 2024, while noting that overall TV demand remains weak, with shipments falling 4% year-over-year in Q1 2024. Young also highlights the role of the smallest TV panel size (32″) as a bellwether for price changes in the industry, being the first to experience fluctuations. LCD TV panel prices peaked in September 2023 and are expected to reach another peak in May/June 2024, 50% higher than the all-time low observed in September 2022.
Despite the recent fluctuations, it is a rare period of price stability, with prices varying less than 10% between December 2023 and June 2024. This stability has contributed to improved profitability for panel makers in Q1 2024. However, Young cautions that the industry’s production capacity still significantly outpaces the likely demand for the foreseeable future, emphasizing the need for continued discipline among panel makers to navigate the challenging market conditions.
