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Suppliers Stoke Soundbar Surge At CES

LAS VEGAS – Soundbars represent the fastest growing segment in the home audio industry, and sales will continue to grow at high double-digit rates in 2013, analysts and suppliers said.

Some consumers are embracing the compact products as simple solutions that beef up the thin sound of their flat-panel TVs. Other consumers, willing to spend about $600 for models with surround decoding and virtualsurround processing, are looking for a surroundlike experience without the hassle of wiring up multiple speakers and components, various suppliers said.

Consumers looking for a simple home theater experience are increasingly opting for soundbars in lieu of HTiBs, whose factory-level sales fell through October by 19 percent to $363.9 million, Consumer Electronics Association (CEA) statistics show.

Factory-level soundbar sales, in contrast, rose 37.6 percent to $229.7 million during that period on unit growth of 38.4 percent to 1.36 million units, CEA said.

Other factors are also contributing to soundbar growth, including intense dealer and supplier promotion as well as a soundbar’s ability to fit more easily than HTiBs and audio components in secondary rooms. “Retail support for soundbars has been key to their success in the U.S., and mass merchants and warehouse clubs are increasing their share of this market, tempting consumers with lowend products, said Jack Wetherill, senior market analyst of Futuresource.

“Dealers can make more profit dollars on a $300 to $400 soundbar than on a $1,000 TV,” said Boston Acoustics product development director Steve Shenefield of dealers’ eagerness to promote soundbars. For their part, TV suppliers such as Samsung and Vizio are leveraging their ability to bundle soundbars with their TV sets, further stoking sales, Futuresource added.

The expansion of flat TVs into multiple rooms of the house is also lifting soundbar sales, said Boston Acoustics VP/GM Mitch Nollman. “With homes having multiple flatscreen TVs, consumers can have a surround system in the main room and a soundbar in the bedrooms and kitchen.”

Other factors contributing to soundbar growth include the continuing replacement of CRT TVs with flat-screen models as well as a widening selection of soundbars from $79 to $2,199, said Quixel Research. The research company forecasts unit-shipment growth of 55 percent in 2013 to 4.77 million units, rising another 47 percent in 2014 and 36 percent in 2015. Dollar shipments will rise 50 percent in 2013 to $983 million, 45 percent in 2014 to $1.43 billion, and 27 percent in 2015 to $1.81 billion.

Futuresource estimates that 4 percent of U.S. households owned a soundbar at the end of 2012, and it forecasts household penetration will rise to more than 10 percent by 2016.

The company said some brands have introduced models with integrated DVD or Bluray Player, but this segment account for less than 5 percent of sales because “the inclusion of a player affects the compact design of the device – and significantly raises the price.”

“The growth is good across the board,” said Yamaha senior VP Tom Sumner, “but most encouraging is the growth in soundbars over $500. We appear to have stopped the race to zero on soundbar ASPs, which should be good for consumers, retailers and manufacturers.”

Neil Manowitz, product marketing director at Sony Electronics Home Audio Video, also sees ASPs rising, indicating that consumers “are interested in a quality audio experience.”

Some of that growth, however, is coming at the expense of HTiBs. “In some ways, I believe this is the consumer either wanting a very simple solution in soundbars or a highly personalized, customizable solution in a component audio system,” said Sumner. “I think both component audio and sound bars are contributing to the decline in HTiB.”

Sony’s Manowitz agreed that soundbars are taking a chunk of the HTiB market. “The HTiB customer is shifting to soundbar, but the HTiB market is not going away in the foreseeable future. As soundbar quality continues to improve and provides great theater and music experiences, this market will continue to attract new consumers that desire a better sound solution.”