MAY 2008 W4 ALERT
How Big Do You Want It? For Today's LCD TV Consumer...That's 32-inches Please!
Industry analysts say today's consumer wants smaller...not larger LCD TVs
<Reuters-TOKYO><May 22, 2008>In a report from Reuters, industry analysts say LCD TV manufacturers geared up to offer 40- inch and larger flat panel sets, assuming consumers wanted big TVs. But consumers looking at LCD flat panel TVs say 32-inches is big enough…causing manufacturers to scramble to adjust their production.
LG Display vice president Champ Shin told Reuters, “As of now, 32-inch is almost one third of the market. Up to now, most LCD makers had focused on large screens only. But the growth rate of larger screens seems to be a bit slow.”
And the phenomenon is not exclusive to the U.S. market. Customers in emerging markets such as China, India, and Russia are purchasing large numbers of 32-inch and smaller sets to replace their older CRT TVs.
According to the report, the trend to smaller sets is expected to continue for the next few quarters as the U.S. economy remains sluggish and the China markets take off in advance of the upcoming Olympics.
Taiwan manufacturer AU Optics CEO H.B. Chen told Reuters that moniTV products, monitors in widescreen high definition format used for TV could double sales to more than 50 million units in 2009. Popular with students and in small households, moniTV models start at 15-inch models with 19-inch versions considered mainstream in the format.
Some analysts suggest, however, that a looming oversupply of panels expected in 2009 will cause makers to drop their prices stimulating demand for larger sizes and overtaking the smaller screen market, including moniTVs.
Analysts told Reuters that 40-inch LCD flat panel TVs will be under $1,000 by the fourth quarter of 2008 which should boost demand and cause average screen sizes to increase.
“In the U.S., the sweet spot is quickly moving to 40-inches,” says Mike Splinter, CEO of Applied Materials Inc.
As previously reported in the ALERT, the industry research firm iSupply estimates that the worldwide market for LCD TV’s in 2008 will be 100 million units and will grow to 194 million units by 2012.
Last year, iSupply says, LCD TV shipments were 78.5 million units.