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Toshiba Pledges Leadership Expansion

Toshiba is looking to build its leadership status in most television categories this year by supplying one of the industry’s broadest assortments, said Scott Ramirez, Toshiba Consumer Products America’s marketing VP.

Speaking recently at his company’s line show, where the company unveiled expanded lines of DLP rear-projection sets (both 720p and 1,080p versions); plasma and LCD flat-panel TVs and TV/DVD combos; and new HD direct-view CRT models, (TWICE, May 23, p. 1), Ramirez articulated a 2005 television strategy embracing both flat and non-flat direct-view CRT TVs, CRT-based rear-projection TVs, and Surface-conduction Electron-emitter Display (SED) flat-panel products, now scheduled for a 2006 U.S. introduction.

Ramirez cited market share studies from several analysts showing Toshiba as No. 2 in overall TV market share during 2004 — at 11 percent — following only Sony.

“We will raise that number this year,” vowed Ramirez, who dressed in a general’s combat fatigues, playing off the show’s proximity to the “Roswell UFO incident,” and “Area 51” of Groom Lake, Nev.

Helping achieve that goal, Ramirez said, is the fact that Toshiba “does not just have every [TV] category — we are strong in every category” in 2005.

A particular strength for the company in 2004 was direct-view CRT TV, where Ramirez claimed No. 1 market share.

This year he forecast industry analog direct-view CRT television sales to decline by 11.5 percent. Sales of 4:3 digital direct-view CRT are declining at a 31.8 percent pace, so far, he said, but widescreen digital direct-view CRT sales will grow by about 100 percent to 1.2 million units in 2005, virtually matching the growth rate of flat-panel TVs.

In total, direct-view CRT sales will account for about 19 million units in 2005, according to Ramirez.

“Direct-view may not be the sexiest part of the business, but it is still an important part of the business … and we are still the biggest player in this category,” Ramirez said, citing multiple industry surveys.

In 2005 Toshiba is offering 15 direct-view CRT models, six of which are high definition. The HD line will all be widescreen monitor-only pieces. These include current TheaterWide models in 34W-inch ($1,199), 30W-inch ($899) and 26W-inch ($599) screen sizes, and Cinema Series models in the 30W-inch ($999) and 34W-inch ($1,299) screen sizes, which are due in September.

Toshiba has placed speakers at the bottom of its CRT models, to allow placement in existing furniture.

The company is also offering tri-play (TV, DVD, VCR) direct-view CRT HD monitors in 26W-inch ($699) and 30W-inch ($999) screen sizes.

In standard definition, the company will offer both flat- and curved-tube designs.

Rear-projection television sales peaked in 2004, Ramirez said, adding that the business is shifting from CRT-based models to those based on microdisplay technologies, including DLP, LCD and LCoS.

According to Toshiba’s estimates, microdisplay sales accounted for 39 percent of rear-projection TV sales in 2004, but will climb to 69 percent in 2005, with a bigger percentage of sales moving to larger screen sizes and 1,080p capability.

Looking forward, Ramirez said the microdisplay sales could peak in 2006, when the category is expected to take 91 percent of the rear-projection TV business.

Ramirez cited the need to stay a step ahead of the aggressive growth of flat-panel technologies, in explaining Toshiba’s plan to launch 1,080p DLP capability in six of 11 models this year (TWICE, May 23, p.1). Ramirez said DLP models must use their advantages to compete against the form factor of flat panel. These include more affordable prices in larger screen sizes, and full 1,080p resolution.

“We are not technology agnostic. We are evangelistic about DLP,” Ramirez said.

Although CRT-rear projection TV numbers will decline, Toshiba will continue to offer models in 2005, Ramirez said.

New for 2005 is Toshiba’s Custom Series of HD CRT rear-projection monitors, priced for mass sales. To get around the Federal Communications Commission’s DTV tuner mandate, Toshiba is omitting NTSC analog tuners from two models. Custom Series models will be offered in the 51W-inch ($1,400 suggested retail) and 57W-inch ($1,600) screens sizes. The company is also carrying over one 57W-inch TheaterWide digital-cable-ready, CRT-based model at $1,899.

Detailing the company’s strategy for integrated products, Ramirez said all of Toshiba’s integrated models in 2005 will have ATSC tuners, digital CableCARD slots and TV Guide On Screen programming guides to maintain a positive experience for the consumer.

In flat-panel TV, Ramirez forecast industry sales to grow 75 percent in 2005, with sales shifting to larger screen sizes as prices continue to decline.

“As prices come down, people don’t bring down their cost expectations,” Ramirez said. “They just keep getting more for what they would have spent, so automatically, screen sizes will get large.”

Ramirez said that in 2005 “there is not much of a war” on a screen size basis between LCD and plasma TVs. “Plasma wins, and plasma will grow big, this year,” he said.

This year, the bulk of the flat-panel volume will go to LCD in the 37W-inch and under screen sizes, while a majority of sales of 42W-inch and 50W-inch models will be plasma, he said.

In 2006, 40W-inch and larger flat-panel sales will start to shift to LCD away from plasma, he predicted.

By the fourth quarter of 2006, Toshiba forecasts large-screen flat-panel street pricing to begin to level off between plasma and LCD. A 42W-inch high-definition plasma set will sell for about $2,411, compared to about $2,740 for a 42W-inch 1,080p LCD TV, Ramirez predicted.

Toshiba’s 19-model 2005 flat-panel selection (see TWICE, May 23, p. 1) includes five plasma models and 14 LCD TVs, including 8 LCD/DVD combo players. Ten flat-panel models this year will be digital cable ready.

Ramirez cited LCD as a core competency for Toshiba. Currently the Toshiba/Matsushita factory makes 14-inch to 20-inch LCD panels, but next year a new Toshiba/Matsushita/Hitachi LCD facility will churn our 23W-inch, 26W-inch, 32W-inch and 37W-inch high-definition panels.

Most of this year’s widescreen flat-panel models will include Toshiba’s PixelPure AT video processing technology. In addition, a number of Toshiba’s step-up flat-panel models this year incorporate a new SoundStrip speaker system, which uses a new thin speaker to replace traditional side or bottom-mounted speakers.

Ramirez said that some time next year, Toshiba will introduce the long-awaited SED flat-panel technology it co-developed with Canon.

The technology, which is claimed to match the picture quality benefits of direct-view CRT with the form factor of plasma TVs, will begin limited production of a 50W-inch 1,080p model later this year, and is now scheduled to see U.S. deliveries sometime in 2006.

Toshiba forecasts that by 2008, SED will account for 20 percent to 30 percent of the 40W-inch and larger flat-panel TV market.