LED-Backlit LCD TV Prices to Take Hit Second Half, DisplaySearch Says

LCD TV unit sales in North America fell 3 percent year-over-year in first half 2010 due to economic pressure from high unemployment and the slow housing market, according to the DisplaySearch Quarterly Advanced Global TV Shipment and Forecast Report. Paul Gagnon, director of North America TV Research at DisplaySearch, said continued economic pressure combined with a “sharp slowdown” in price erosion have “pushed consumers to the sidelines” as they wait for the economy to improve or prices to drop.

Prices for LED-backlit LCD TVs are expected to “fall more rigorously” in Q4 at twice the rate of CCFL LCD TV prices, DisplaySearch said, resulting from a glut of LCD TV panels that led to panel cost cuts during Q3 2010. While consumers are very interested in LED LCD TV technology, the report said, premiums were “very high” in early 2010. As the number of LED LCD TVs available at retail rises, consumers still seem to be waiting for premiums to fall on LED-backlit models, the report said. Sales of lower-priced CCFL-backlit LCD TVs continue to drop despite much lower price points, it said. DisplaySearch projects that average LED LCD TV prices will fall at twice the rate of CCFL LCD TV prices during Q4 2010. Falling prices should cause a bump in sales growth, particularly for North America, it said.

DisplaySearch expects LED LCD TVs to account for the majority of LCD TV shipments in 2011, as the cost premium erodes and manufacturers continue to transition LCD TV lineups away from older CCFL technology. LED-lit TVs will account for more than 50 percent of LCD TV shipments in 2011, up from 20 percent in 2010, the firm said.

While LCD remains the dominant TV format worldwide, sales resulting from the World Cup were “somewhat disappointing” in Europe, DisplaySearch said, and rising inventories at the end of the summer will slow growth in the second half, it said. Despite weak LCD TV sales in North America during first half 2010, worldwide LCD TV shipments will grow to 188 million units worldwide, up from 145 million units in 2009, DisplaySearch said, citing strong growth in Japan, Europe, China, Latin America and the Asia-Pacific region. Overall year-to-year LCD TV growth is expected to reach 20 percent during second half 2010.

Demand for plasma TV continues to be robust due to price and improvements in thinness and power consumption, the report said. As LCD TV price declines have slowed, plasma TV prices have kept pace, it said, with plasma shipments expected to approach 18 million units in 2010. According to Hisakazu Torii, DisplaySearch vice president of TV Research, plasma TV continues to be a “key display technology” in the TV category, “especially among a base of fans that favor this technology for picture quality and 3D performance.”