3D TV Proves Not To Be Driving Force In 2010 As Was Hoped

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The new and improved 3D TV system hardly started out as the revolution some manufacturers and content producers made it sound like during last spring’s star-studded launch events and viewing parties.

In fact, set adoption amounted to little more than a blip on the radar screen in the overall HDTV mix last year. According to TV market analyst Tamaryn Pratt, of Quixel Research, full 3D TV system sales (TVs including emitters and glasses out of the box) were expected to register less than 1 million units in the U.S. since the launch of the first sets last March.

The results weren’t exactly disastrous for the launch of a new advanced TV system — it just didn’t deliver the cure to the recessionary blues most retailers have been desperate to kick since 2008.

Instead of feature-packed 3D TVs, a large percentage of shoppers opted for the barest of bones 2D models with 720p resolution, blowout prices and thin dealer margins.

Despite more pessimistic reports of 3D TV sales performances during 2010, John Revie, Samsung home entertainment senior VP, said his company is projecting U.S. sales of 2 million 3D TV units in the 2010, and expects that number to climb to as high as 6 million units in 2011 as the technology spreads into more TV model classes.

To help achieve that Samsung is spreading 3D capability to some 80 percent of its 2011 flat-panel TV models.

Comparatively, Quixel Rearch is forecasting sales of approximately 3.8 million units in 2011, an assessment supported by several other set makers.

“I’m not saying that it won’t grow tremendously more if manufacturers add the capability more broadly across their product mix,” Pratt said, “but there is still a lot of LCD TV sold by lower-tier players, who won’t be including 3D as aggressively as Samsung next year.”

Revie, whose company claims market share leadership in the new technology, said that manufacturers and retailers actually got a lot right in the rollout of 3D TV last year. In 2011, the emphasis will be on further “educating consumers” and getting them to see 3D movie demos while optimizing the in-store experience to drive home the message that “3D movies offer a more immersive experience.”

At the same time many manufacturers this year will be re-emphasizing 3D TV as an HDTV feature rather than a new TV category. Some industry observers believe the new-category approach may have turned off or confused potential customers still adjusting to the recent and massive transition from analog to digital TV broadcasting.

The strategy here is that by making 3D a feature story it can be added to more model lines, without leading confused consumers into thinking the technology is only compatible with 3D TV content. It also helps feed the Trojan Horse effect of getting the capability into the hands of purchasers that may not have cared about 3D, only to embrace it after experiencing it in their own living rooms.

With such customers in mind, many manufacturers will be offering lines of 3D TVs without the customary bundled glasses, to reduce the upfront adoption cost this year.

Other than price, the biggest consumer turnoff to 3D, according to numerous shopper surveys, was the need to wear and purchase expensive 3D glasses.

Manufacturers including LG, Toshiba and Vizio, are addressing that in 2011 by offering 3D TV lines based on polarized “passive” glasses technology, offering generally more comfortable glasses that are significantly cheaper, and familiar to consumers who have worn them in 3D movie theaters. In fact, the glasses many brought home from those theaters can be used with the new sets — a far cry from the $150 to $300 a pair price tags placed on aftermarket active-shutter eyewear.

LG and Toshiba are positioning their passive-glasses 3D TVs as entry 3D, despite the anticipated added cost the technology puts on the TV side of the equation.

Both companies continue to offer active-shutter 3D sets in their highest end lines, where brighter pictures and faster frame rates are generally required.

LG also will use only active-shutter glasses (this year with more robust RF instead of IR linking) in its 2011 3D plasma lines, because plasma technology was not considered bright enough to support the dimming effect the glasses introduce, according to Tim Alessi, LG home entertainment product management director.

Both LG and Samsung will also offer 720p active-shutter 3D plasma models next year at less than $1,000 price points as added-value alternatives.

Sony, like many manufacturers, is looking to expanded active-shutter 3D into the LED/LCD TV category. Some 16 models will have 3D LED capability in screen sizes ranging from 32 to 65 inches this year, Sony said, as it plans to push combined 3D and connected TV systems models in ultra-thin monolithic design cabinets.

Makers or LED models are looking to shore up their offerings as 3D plasma has gained back some lost ground: purchasers of 3D TV in 2010 gravitated to a greater degree toward plasma models with the capability, after perceiving the effect to be superior in the active-shutter viewing environment, Pratt observed.

According to Samsung’s estimates, U.S. plasma sales enjoyed between a 10 and 15 percent increase in units year over year to close to 4 million. While some growth came from 3D models, Revie said the majority of the business actually came from lesser featured 1080p and 720p models that gave shoppers a strong value during the tight economy.

Average prices trended 10 percent or lower below comparably configured LED LCD TVs, said Revie.

Most analysts, manufacturers and retailers also agree that the launch of 3D was hampered in 2010 by the perceived lack of available 3D content. Many of the biggest 3D Blu-ray Disc titles were restricted to purchasers of select TV brands that had pre-arranged bundling exclusives on titles with studios to help defray studios’ risks and disc production costs while helping to hype manufacturer-specific TV lines.

While title bundling will likely continue this year, the library of openly available 3D Blu-ray movies grew by the end of 2010 to more than 24, with many more scheduled for release in the year ahead.

Meanwhile, 3D content has also spread to specialized channels on more cable and satellite TV platforms, showing key events, movies and programs in 3D, while Samsung has added a 3D movie trailer app to stream content from the Internet.

New 3D content availability is scheduled to intensify in 2011, observers said.


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