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A/V Execs See Hope, Challenges In Q4

ATLANTA

– A soft flat-panel TV market, the state of
3D TV and a surprising revival in home audio was the
talk of top manufacturers and buying group execs during
CEDIA Expo, here.

All admitted that the TV business was slow during
the summer and that September, which provided a
boost due to the beginning of football season, was
historically lower than prior years. There was also concern
about lackluster interest in 3D TV, but hope that
its fortunes would revive during the fourth quarter.

The fourth quarter will undoubtedly be promotional,
with aggressive pricing on Black Friday. The only
question will be whether those promotions will result
only in a Black Friday or a Black November.

Suggestions have been made that aside from a still
suffering economy the introduction of iPad, e-readers
and 4G phones took dollars out of the TV market.

Rick Calacci, LG Electronics regional sales VP, did
not agree and said the quiet summer was “some of
the usual seasonality” and that currently “the return
of football season has helped. But has it lifted sales
where it should be? No, not yet. But we think it will
get there soon.”

Concerning the fourth quarter, Calacci said, “We
haven’t changed our production plans, but we have
changed our promotional plans. Industry promotions
[on TVs] will vary by their length and breath.

Jim Sanduski, senior sales VP for Panasonic, said the dents had been able to introduce
3D and demonstrate it properly, we
could have helped establish the market
and explain the technology.”

Both men quoted a study commissioned
by both groups that said
their members demonstrate 3D TVs
59 percent of the time while national
chains have done it 22 percent of the
time. “If you go to national chains the
quality of their 3D demos are non-existent
… or ineffective,” Ristow said.

Ristow said the hoopla surrounding
of 3D TV has “stepped over IPTV,
which is a very viable and useful feature
for consumers,” Ristow noted.

And finally, when asked if this
would be a typical Black Friday or
will heavy retail promotions make it
a “Black November” for flat panels,
Ristow and Workman maintained
there will be “major Black Friday
events” but hoped the industry would
avoid over-promoting.

The danger, if the promotions get
too aggressive, is “it will drive people
into the stores that weekend then
they disappear for two weeks,” until
retailers promote heavily again to get
consumers back right before Christmas,
Workman said.

Richard Glikes, executive director
of Home Technology Specialists of
America (HTSA), told TWICE at his
group’s CEDIA reception that his
group was optimistic about the balance
of the year. “In September …
bigger houses are being built and our
guys have more jobs in the pipeline.”

Glikes said HTSA’s moves to get
involved in alternative categories “is
going well and progressing. We are
doing well with that.” And he added,
“I keep on telling members that you
can’t just rely on TV sales. If you are
just a TV store you will be out of business.”

That being said, Glikes is optimistic
about 3D. “It will happen. It will
happen if the Hollywood studios
want it to happen. I am hopeful.”

One pleasant surprise has been
higher home audio sales after a prolonged
malaise, with speakers and
networked receivers leading the way.

For instance HES and PRO reported
that their audio sales have been
up by double digits during 2010.

Jim Minarik, president/CEO of DEI
Holdings, acknowledged that trend.
“This growth has been a surprise this
year. These retailers [HES and PRO]
have done better with audio than the
past couple of years and the industry
is performing better too.”

Bob Weissburg, president of sales
and marketing, D&M Holdings, explained,
“There is pent-up demand for
audio with existing products and new
speaker configurations such as soundbars,
thin speakers to match thin TVs.
Only when consumers get home do they realize how some flat-screen TVs really
sound and they need speakers.”

Networked receivers, which manage
and channel content from iPods or
MP3 players, Internet radio and the like,
have done well too as the hub of the networked
home.

“Many networked receivers are HDMI
1.4 compatible, meaning they are all 3Dready,”
Weinberg noted.

He suggested, “I think we will see
modest growth in A/V during the fourth
quarter due to home audio growth, interest
in 3D TV, HD and
Internet TV.”

But Weinberg
stressed, “Consumers
need to see 3D
demonstrations at retail,
but they have to
be done correctly.”

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