DTV Picture Brighter
New DTVs hold promise
By Peter Brown
From Electronic News--January 11, 1998
sumnet.com
Las Vegas--With the price of first-generation digital televisions (DTVs) as high as sports
utility vehicles (SUVs), most consumers understandably shied away from the product in
1998. But lower prices and new features are on the way, giving the sets a fighting chance
to enter more homes this year.
At this year's International Consumer Electronics Show (CES) here, consumers began to
see a clear picture of second-generation DTV offerings from manufacturers. Early DTV
models, including high-definition television (HDTV), carried price tags as high as
$25,000. Most of these televisions were huge rear-projection sets with sizes ranging
from 60 to 100 inches.
Moving into 1999 and beyond, second generation televisions are starting to emerge that
are significantly lower in price and that are more manageable in homes because of a
smaller viewing screen.
Todd Thibodeaux, vice president of research at the Arlington, Va.,-based Consumer
Electronics Manufacturing Association (CEMA), said that digital televisions are moving
closer to a $3,000 price point for models rolling out toward the end of 1999 and into the
beginning of the year 2000.
"Prices historically for consumer electronics drop 50 percent over a 10 year span,"
Thibodeaux said. "What we are seeing with digital television, however, is that most prices
are already dropping and in five years a television that was $6,000 could be priced
around $1,500." At this price point, DTVs are more affordable for the mainstream
population, he noted.
According to CEMA numbers, consumers were less than thrilled with DTV in 1998,
with about 13,000 sold in the United States. Thibodeaux conservatively expects this
number to at least double in 1999.
Some of the first of these lower-priced, second-generation HDTVs were shown at CES,
including projection sets like Toshiba's TP61H95 61-inch set priced at $4,099, Hitachi's
60SDX88B 60-inch television priced at $4,299 and Mitsubishi's TS-55813 55-inch
DTV priced at $4,299.
While most of these televisions are still rather large, multiple digital television
manufacturers showcased HDTVs and standard definition televisions (SDTVs) at CES
that are in the sub-40-inch range and use traditional cathode ray tube displays. Analysts
say these DTVs may be more appealing to consumers who do not wish to have a huge
television in the home. These include Panasonic's $3,199 CT-36DV60 36-inch 4:3
aspect ratio DTV, which requires an external decoder box; and a 35-inch set from RCA.
However, there are still many high priced DTVs coming to market including Toshiba's
65-inch DW65X91 priced at $8,999 and the $25,000 50-inch plasma display HDTV
from Pioneer. Most of the new expensive televisions, however, include higher levels of
functionality such as interactivity, web browsing and other digital data services.
Because of the wide variety of television's options and multiple levels of integration, a
concern rising from the retailers and broadcasters at CES was the lack of education
associated with DTV in the market.
"The train is pulling out of the station with DTV," said Terry Shockley, an owner of
multiple network affiliates who is working on DTV consumer education. "Because of
that, I think that consumers have been far underestimated that they won't accept and
purchase DTV. The one main problem we are seeing is the lack of education on what to
buy and what the benefits are. We are trying to rectify that now."
From a semiconductor point of view, many semiconductor vendors, including Philips
Semiconductor, Samsung Semiconductor and Toshiba Corp. agree that most of the price
reductions are not coming necessarily from the semiconductor content but more from the
surrounding components including the displays. While some price reductions can be
taken because of the advancement in process technology and high levels of integration,
these semiconductor vendors believe most of the discounts will come from other means
as the chips already are low in price.
"You are expecting a lot from a television when a consumer pays $7,000 for it," said
Con Maloney, chairman of the board for Maloney's Electric City retail store based in
Jackson, Miss. "You either have to lower the price, which is happening, or you have to
offer enough functions or applications that it compels the consumer to pay as much as a
car for a television."? |
