By Lisa Johnston
New products on display at the American International Toy Fair, held in N
El Segundo, Calif. — A last-minute rally in the fourth quarter of 2013 was not enough to save the U.S. television business from a steep 9 percent unit shipment decline for the year, as Americans continued to hold off purchases through most of the year, a new report from IHS Technology found.
The market research firm said U.S. TV unit shipments in 2013 declined to 34 million, down sharply from 37.5 million in 2012.
In 2014, virtually all TV shipments consisted of flat-panel LCD TVs and plasma sets. Both sectors lost volume over the course of 2013 from a year earlier, IHS found.
LCD TV shipments slid to 31.9 million units, down 6 percent, while plasma TV shipments plunged 42 percent to 2.1 million.
“The TV market in the United States has reached a point of saturation following a period of huge growth in years past, especially as the flat-panel-TV craze set in,” stated Veronica Gonzalez-Thayer, IHS TV systems analyst. “As a result of the market’s maturity, and also because of lingering uncertainties in the economy, American consumers have been less eager to rush out and buy new replacement TV sets.”
The results marked the second year in a row of U.S. TV unit shipment declines. From 2009 to 2011, the U.S. TV market continued to grow or remained at robust levels, and each year saw shipments of more than 38 million units.
In contrast, 2012 volume was less than 37 million, and shipments last year dipped below the 34 million mark for the first time in five years.
IHS said the lower overall figures for 2013 “stem not only from the significant decrease of plasma TVs but also because of continued weakness in the LCD TV segment.”
IHS believes plasma TVs are on their way out with shipments, citing declining shipments since 2010, while the LCD TV segment was down in 2013 for the second year in a row.
Wholesale revenue from TVs also took a deeper tumble across each quarter of 2013 than in 2012.
TV revenue for the year was down 12 percent to $23.5 billion from $26.9 billion in 2012.
Even an increase in the shipments of large-sized flat-panel models with advanced features like Internet connectivity and full high-definition 1080p resolution was not enough to prevent the revenue decline, and a general 3 percent decline in average selling prices during 2013, said Gonzalez-Thayer.
Underscoring the market’s softness last year, shipments during every quarter in 2013 were down from their equivalent periods a year earlier, IHS said.
The first-quarter deficit was approximately 700,000 units, with the difference in shipment volume ballooning during the second quarter to nearly 1 million units.
The third quarter incurred a loss of 800,000 units compared with the same time in 2012, and the fourth quarter fell short as well by more than 1 million units.
Despite the grim results, IHS said the prospects appear better for 2014.
The market will start to stabilize this year as the consumer purchase cycle readjusts after two years of continuous losses, it noted. Shipment growth is predicted to be flat to slightly positive in 2014.
In particular, LCD TV shipments are forecast to be up this year from 2013, reversing last year’s decline. And for the first time, AMOLED TVs will be entering the U.S. market in perceptible volume.
About 8,000 shipment units are expected in 2014 of AMOLED TVs, which will feature super-thin profiles and significantly improved contrast ratios that could appeal to TV connoisseurs eager to become first adopters, even though very steep pricing at present makes the units out of reach for most buyers, IHS pointed out.
“Together the projected rise in LCD TV shipments, as well as the entry of AMOLED TVs, will help revitalize the U.S. TV market this year,” according to IHS. “Both factors will also help cover expected losses in the plasma segment, which will finally cease shipments after 2015.”
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