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Soundbar Sales Tide Lifting All Boats

5/21/2012 12:01:00 AM Eastern
NEW YORK — Active soundbars have turned into a key growth category for suppliers and retailers.

Sales are surging at all price points, including upperend models priced around $1,000 and more. Average selling prices so far this year are rising, and the category is expanding the home audio market, suppliers and retailers told TWICE.

Strong sales of Bose’s first two soundbars, despite high price points of $1,499 and $2,499, are encouraging multiple suppliers this year to launch their own high-priced soundbars to complement the many models priced less than $500, suppliers and retailers noted.

The success of Bose’s $1,499 system, said Pro- Source president/CEO Dave Workman, “stretched the boundaries of what dealers expected consumers would accept,” and Bose’s success is having a halo effect on sales of $699 to $799 bars, he added. “Bose is building the business at $500 and up,” Workman continued. The Bose products “showed that retailers don’t have to be afraid of trying to sell soundbars above $500.”

As a result, he added, about a half dozen companies later this year will launch soundbars at around $999 and more. “Everyone’s revisiting their roadmap because of Bose.”

Bose’s success “had an effect on manufacturers sitting on the sidelines wondering if there was business at the higher end,” agreed Al Baron, Polk product line manager. Demand for the form factor “is so strong that suppliers want to cover as many price points covered as possible.”

In 2012, the Consumer Electronics Association (CEA) forecasts a 117 percent surge in factory-level soundbar sales to $485 million, propelling soundbar sales to exceed HTiB sales for the first time. The soundbar numbers include amplified and passive soundbars lacking embedded DVD or Blu-ray players.

Factory-level HTiB sales will fall 15.9 percent in 2012 to $476 million, CEA forecast.

For its part, The NPD Group found retail-level soundbar sales up 84 percent in dollars to $220 million for the 12 months ending March 2012.

“The majority of purchasers are new audio customers,” claimed Polk’s Baron. Some soundbar sales come at the expense of HTiBs, and some come at the expense of passive sub/sat systems. Nonetheless, “a lot of the business is newly generated business,” he said, because a soundbar is “the only form factor that looks like it belong with a flat-panel TV” and because “it’s for average consumers without a Ph.D.”

“Audio attachment is alive and well, but you have to get the form factor and functions right,” Baron said.

Soundbars are for the non-hobbyist and non-audiophile because they’re easy to set up and use and are visually unobtrusive, Baron continued. At higher price points, including the $800 price point planned for the company’s new Surroundbar 9000, the products appeal to consumers “who want better audio without components,” he said. The bar will join three current active Polk bars priced from $350 to $500.

Active bars are going mainly into a home’s main TV room but are also appearing in secondary rooms such as dens and bedrooms, Baron noted.

Baron sees soundbars appealing mainly to consumers who want to improve the sound quality of a flat-panel TV, but at higher price points, Workman sees some additional appeal. Below $500, the products are primary TV-sound enhancers, but over that, dealers are selling audio quality for music sources, not just for TV, he said. At $699 to $799, dealers talk up better sound quality as well as virtual surround. Systems at Bose’s prices “take the place of an HTiB system” because they’re an “easy-to-install alternative solution with phantom surround and can be used for music and TV.”

To tap into soundbar growth, companies such as Polk, Harman Kardon, LG and P&F USA (Philips) have expanded their soundbar selections, and to differentiate their products from an influx of soundbars, companies are slimming down their soundbars to take up less space, with Sharp offering a new model that’s only 1 inch tall.

Sharp and Samsung have launched “convertible” models with inserts that can also be removed to turn a horizontal soundbar into two separate left-right vertical speakers sitting atop their own stands. When the soundbars are placed in a horizontal position, the inserts on the Sharp and Samsung models can be replaced to expand or reduce soundbar width to match different-size TVs. For its part, Panasonic launched a convertible soundbar, but its horizontal width is fixed.

A new technology appearing in soundbars for the first time is 3D audio post-processing technology, which turns up in two LG soundbars to make sound leap out from a 3D TV screen in sync with the 3D image appearing on screen. The LG technology “unburies” 3D spatial cues in a soundtrack to correlate audio-image depth with the depth of the on-screen 3D action. If objects or people leap out from the screen, the sounds they make also move forward.

Also this year, multiple suppliers — including LG, Samsung and Panasonic — are launching the industry’s first soundbars with stereo Bluetooth technology, enabling consumers to stream music wirelessly from any Bluetooth-equipped smartphone or MP3/video player. Panasonic also uses stereo Bluetooth to stream audio from select Panasonic TVs equipped with Bluetooth.
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