industry news

As Rear-Projection TV Moves Up-market, Makers Explore Options
by Steve Sechrist, Jamie Townsend, and Ken Werner

December 8 - Last week, Pacific Media Associates reported rear-projection TV (RPTV) sales and revenues for October. Unit sales were down 2.7% from September, but revenues were up 3%. Why? ASP was up 5.5% on the month because sales were migrating to 1080p and to larger screen sizes. As a percentage of sales, 1080p models accounted for 13% in August, 24% in September, and 32% in October.

We anticipated this transition. RPTV is the only way to get large-screen (50-inches-plus), Full HD at a reasonable price, while the prices of direct-view flat-panel TVs in the 32- to 42-inch range are plummeting, spurring excellent sales. So the move up-market was inevitable for RPTV, but that move implies an ongoing reduction in unit sales. How will RPTV makers respond to this pressure?

InFocus has left the RPTV business (see Projection Monthly, p. 22, December 2005), and Displaybank reported yesterday that LG Electronics would also bow out of the business in 2006, quoting an unidentified source as saying that the high inventory and marketing costs could not be justified for a segment that accounts for only 5% of the market (see www.displaybank.com). Subsequently, LGE’s Judy Pae said the story was not true, but a Digital Times story today, which also appeared on Displaybank, said that LGE has decided to delay rolling out it's LcoS RPTV line until "next year." The story quotes an LGE official as saying, "The launch time has not been fixed yet, and we don't need to put a damper on the sharp growth in the market for LCD and PDP TVs by releasing new models." What that means may not be entirely clear, but it doesn’t sound like an enthusiastic endorsement of LGE’s participation in the RPTV business.

Other companies having a greater RPTV market share are taking a different view. Samsung and Sony have increased their commitments to the segment, with Sony boasting the two top-selling RPTV models in the North American market, according to Pacific Media. Whatever LGE’s ultimate position turns out to be, it doesn’t sound good for projection-chip-and-engine maker SpatiaLight, whose main customer is LGE.

Insight Media, 203-831-8464, kwerner@insightmedia.info

Contact:
Insight Media
Annmarie Gabisch, 203-831-8564
annmarie@insightmedia.info