Bentonville, Ark. - Wal-Mart is going wide on DTV rolling it out to 1,500
> stores nationwide.
> After testing high-definition plasma and rear projection monitors in at least
> two Wal-Mart units in Arkansas and Florida, the world's largest retailer is
> preparing to roll out an assortment of HD and HD-ready sets.
> The selection will likely include six SKUs, including two HD plasma display
> panels (PDP) from Sanyo and four rear projection monitors from Philips and
> Thomson.
> Wal-Mart would neither confirm nor deny the rollout, but a source familiar
> with the plan told TWICE that preparations for the installations are currently
> underway. The units will be sold in more than half of the chain's 2,700
> discount stores and supercenters.
> The HD array is already in place at Wal-Mart's Rogers, Ark., supercenter,
> whose reconfigured CE department may serve as a template for the launch.
> According to retail analyst Aram Rubinson of Banc of America Securities, who
> recently visited the store, the assortment includes Sanyo's 32-inch and
> 42-inch PDPs, which are ticketed at $3,968 and $5,968, respectively.
> Among the rear projection units, the store is carrying a 52-inch RCA model for
> $1,688 and three Philips SKUs: a 43-inch for $1,584, a 46-inch for $1,654, and
> a 50-inch for $1,772.
> The store is also stocking an analog rear projection model and two direct-view
> digital TVs: a 32-inch Philips and a 36-inch RCA that are both retailing for
> $1,292.
> Bob Nocera, Philips digital television marketing VP, acknowledged that
> Wal-Mart is carrying two of his company's 4:3 rear projection HDTV monitors in
> the 43- and 50-inch screen sizes, and is 'experimenting' with other Philips
> models including some direct-view CRT DTV monitors in select locations.
> Nocera said he was unaware of any service or delivery programs that Wal-Mart
> was offering to support the line at this time, adding that at least initially
> DTV sets were sold on 'a cash and carry' basis, 'but in time that may change.
> I am unaware of their exact plans on delivery.'
> 'They seem to be taking HDTV seriously and are rolling out a high-definition
> signal to display models in a lot of their stores,' he continued. 'If you look
> at where the market is going, particularly in projection TV, analog has a
> limited lifetime. In a couple of years, basically all projection TV is going
> to be at least digital ready.'
> Nocera said Wal-Mart's pricing structure has been 'competitive with everyone
> else,' and not unusually low.
> Wal-Mart is testing some widescreen displays (including the Sanyo PDPs) in
> select stores, he added, but the Philips program thus far has been limited to
> models with conventional 4:3 screen sizes.
> 'Right now, as there is still a little gap in 4:3 and widescreen pricing --
> especially in picture tube products, the 4:3 models have a little more of a
> mass appeal,' Nocera said. 'But especially in projection TV, I can see that
> changing in the next couple of years.'
> Rubinson said the CE department in the Rogers, Ark. store is about 40 percent
> larger than that of a typical Wal-Mart supercenter, lending it a 'more open
> and accessible' look.
> Besides accommodating the new HD monitors, the additional square footage also
> provides for an expanded selection of video game hardware and software,
> notebook computers - including Sony's Vaio - and about 60 different TV SKUs in
> total, he observed.
> Wal-Mart's move into high-end TV follows Sears' rollout of plasma and LCD
> panels to more than 650 stores last month. While Wal-Mart's initial test store
> retails are in line with average street prices, industry observers are
> concerned that its entry into the high-margin category could ultimately prove
> disruptive.
> 'It's not the healthiest thing for our guys,' said Bill Trawick, president and
> executive director of the NATM Buying Corp.
> Still, Trawick took solace in the complexities of selling, shipping and
> installing HDTV, which are more readily managed by CE dealers than discount
> chains, he said.
> 'It's not a cash and carry item,' Trawick noted. 'It's not like buying a
> 13-inch TV. It's a category that requires salesmanship. I think Wal-Mart will
> have some issues selling that product.'
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