New York – Panasonic showed off its 103W-inch plasma TV, Plasma Concierge program, Blu-ray deck and other digital products in Vanderbilt Hall of the famed Grand Central Terminal, here, today for the thousands of consumers who use the facility every day.
Gene Kelsey, brand strategy group VP, said the strategy behind the display here is “to show the 103-inch plasma and highlight the Panasonic Plasma Concierge program, as well as Blu-ray and our other products to consumers who might not have heard about this.” Based on traffic through the area today, Panasonic will keep the display area open until Friday.
Yoshi Yamada, chairman/CEO, said the idea behind the Panasonic Plasma Concierge program, which is an expanded customer support plan for current and new Panasonic plasma TV owners, “is to show that this is a well-supported product. Some other manufacturers say their products are well supported, but we are showing that it is.” Hotlines with experts to answer Panasonic plasma TV questions are available seven days a week during typical business hours.
Looking at the display area, which was filled with vignettes giving consumers a close look as to how Panasonic’s products can operate and look at home, Martin Kono, president/COO, was asked if this showroom-type display might be the harbinger of a Panasonic retail store. He commented, “I believe we are a manufacturer. We work well with our channel partners. While we do sell and refer consumers to our retailers on our Web site, there is a difference. We can display all of our products on the site and we can explain them and educate consumers about them, and refer consumers to our retail partners.”
Kono and Yamada also discussed the coming fall and Holiday seasons for HDTV and how plasma and LCD will fare in the marketplace.
Kono said that since Panasonic now has a new plasma TV production line in operation as of late July, “We believe that overall there will be enough plasma TV supply especially in 37-, 42- and 50-inch sizes. But it could be tight in the new 58 inch.”
In terms of pricing, Kono said that during last year’s holiday season, “Pricing went down dramatically. We don’t expect that this year. For 42-, 50- and 58-inch products there should be a good sales to profit ratio.”
In addition, he said plasma has a competitive advantage in manufacturing costs versus LCD. “Our new production line in Japan during July we are getting a better yield” and production costs are going down. He also said that the size of components inside each set will be getting smaller.
Separately Yamada was asked about the price competition between plasma and LCD. He noted, “Some LCD makers are having a tough time, in other words they are losing money. Plasma TV makers are making money. There is a different cost structure since manufacturing plasma TVs is more cost-effective than LCD.” And he added, “While it is easier to start an LCD plant, it is more difficult to manufacture bigger screens. Yields are lower than plasma.”
In terms of technology, Kono put it this way, “For smaller screen sizes LCD has an advantage. But for 42-inches and larger [plasma] beats LCD. When the products are displayed side by side and the programming shown of the same quality, plasma beats LCD. The problem is when comparisons are made at retail and the quality of the programming is in question, it is tougher to show the difference. We have talked to our channel partners about that.”
As for filling the gap between its 65W-inch and 103W-inch plasma sets, Kono said, “We have no plans for that. We saw that 70-inch projection TVs never really sold. As for a 90-inch plasma, it doesn’t make sense to me. For our manufacturing levels our bread and butter sets are below 60-inches.”
When asked about how many 103W-inch wide plasma TVs Panasonic to manufacturer and sell in the next 12 months, Yamada said, “Around 5,000 units worldwide. But most of them would be sold in the U.S.” In touting Panasonic’s manufacturing prowess in this area, Yamada added, “Other plasma and LCD makers could manufacture a few 103-inch sets, but we can do it in volume.”
Kono was asked about HD DVD beating Blu-ray to the U.S. market and what that might entail for the format battle going forward. He noted, “Pricing for HD DVD, at $499, and Blu-ray are relatively expensive. This is still a ‘DVD world’ and will probably continue to be through 2007 and into 2008, with the market for high definition discs being small.”