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Front Projection Seeks Performance, Price Balance: Quixel

9/08/2011 12:01:00 AM Eastern

INDIANAPOLIS — At this week’s CEDIA Expo dealers
and installers will be presented with a range of
front projection (FT PJ) products positioned to follow
to seemingly conflicting market trends — steady
advances in technology and performance and rapidly
declining entry and mid-range price points.

Tamaryn Pratt, Quixel Research principal, said, “The
entry and lower of the market has been fueling the overall
front-projection category in the past several years. Is has
been both painful and a blessing. The aspirational customer
is looking for value, and now there are many great
options in the $2,500 to $5,000 and under price range.”

She said that while many custom dealers have
steered away from projects that small, “economic realities
make it necessary, and honestly, there are fantastic
options as the performances from manufacturers
like Epson, Optoma and Mitsubishi have increased.”

Manufacturers that stay in the ultra-high-end FT PJ
segments “are widening their portfolios to reach those
consumers — a great example is Runco’s LS-1 with a
$3,995 MSRP,” she pointed out.

The $5,000-and-higher segments will see growth
in 2011 and account for about 5 percent of the market
in units and almost 40 percent of the market value,
she predicted.

“Compared to the $2,000-and-under segments, revenue
share will increase from 40 percent to 43 percent
and volume from 78 percent to 85 percent,” Pratt said.

Market drivers are greater performance levels for the
price “and 3D is a big factor for the value increase in
both the low and high end of the FT PJ market.”

Both Epson and Optoma, leaders in the entry and
entry-step segments, will have several models less
than $2,000 that include the 3D feature.

“They can charge a small premium. It helps the economic
for everyone in the chain,” she said.

Pratt said 3D is slowly becoming a significant factor
in the growth for the FT PJ segment.

“We know the ratio of 3D glasses sold with FT PJs is
higher than expected, and the percentage of sales is becoming
significant or almost 45 percent of the products
sold over $5,000 in 2011 were 3D-capable. At CEDIA
2013, there will be few if any projectors that are not 3D
capable,” Pratt predicted. “Of any display, this is the one
that makes sense for 3D. It is immersive and communal.”

As for the active vs. passive 3D glasses debate, Pratt
said that in FT PJ, “active has the strong hold, especially
under $10,000. However, it is an interesting pitch
to link the passive glasses to the cinema experience.”

Quixel is forecasting the overall FT PJ market to
grow 6 percent to 163,388 units in 2012. That number
includes the lower-resolution models (DVD/combo)
and if mass retailers decide that the segment is no longer
important for their customers, we will see sales
decline precipitously.”

As for new PJ technologies, “LED projectors have
not been a huge factor yet,” Pratt said. “Part of that
has to do with the economy, as well as the economics
of designing and building new products for a niche
market. However LED will be a factor.”

Quixel reported that through the first half of 2011
only 11 percent of the $5,000 and under market was
made up of LED projectors but over 60 percent of the
$10,000 and over models were LED.

“A lot of this delta is about pricing, and new lowerpriced
models are just now coming into the market
whereas pre economic decline, most manufacturers
were showing future model lineups with a broad LED
offering,” said Pratt. “On the dealer side, it is safe to
say that FT PJ consumers dislike bulbs, or any kind
of ongoing maintenance if they can avoid it. So that
is a big plus. Dealers also like the color performance,
instant-on and the energy efficiency.”

As for top-performing home-theater projector
brands, Pratt said Epson is the key driver in the sub-
$2,500 segment, leading share overall and gaining
overall in the less-than-$5,000 segments where many
CEDIA dealers have embraced them.

“JVC is the market leader in the $5,000 to $10,000
range, and they have had recent successful moving
upstream with their DLA-RS60U/DLA-X9 models,”
Pratt said.

At the same time, Sim2, DPI and Runco in the ultrahigh
end have made significant inroads, increasing
their breadth downstream, and are adding even more
new models this year and next.

“This opens up the risk of diluting a high-end brand,
really,” Pratt said. “Ferrari doesn’t even consider an
entry model.”

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