TV Makers Need to Stress Apps, Not Resolution, Say CEA Forum Panelists

SAN FRANCISCO -- Whether advances in technology have reached a point of being “good enough” was a recurrent theme at the Five Technologies to Watch session at the CEA Industry Forum Monday. Of the five technologies, displays and high-end audio stood out as categories where advances in quality and resolution may have maxed out in consumers’ minds, leaving categories such as TVs and audio components with no option but to expand into broader usage models rather than higher quality experiences.

"Resolution alone” won’t win consumers over, said Scott Steinberg, CEO of consulting firm Tech Savvy Global, stressing the need for compelling apps and content to drive future TV sales. As the TV becomes the “digital command center” of the home, connectivity and ancillary technology including remote controls, built-in cameras and streaming music capability will be the sought-after features that enable consumers to “do more with their TV,” Steinberg said.

Lack of native content is a deterrent to sales of 4K displays, and Steinberg said sports and movies will be key to fueling the early market in the ages-old chicken-and-egg quandary of content availability and hardware sales and adoption. Content will also have to be subsidized in the way it has been with 3D content, he said, although no content deals have been announced in the fledgling days of 4K and no pre-packaged format currently exists for the medium. Early indications from ESPN, which supported 3D early on with ESPN 3D, are that the network doesn’t plan to aggressively pursue native 4K content due to high prices of 4K TVs that limit the mainstream viability of the format and a lack of production tools to produce 4K content.

Whether content shot in 1080p will be “good enough” upconverted to 4K on emerging ultra-high-resolution displays remains to be seen. Shawn DuBravac, CEA senior director-research, cautioned that it takes several years for a new technology to go mainstream and while early adopters are more “tolerant” of a new technology’s shortcomings, as the format becomes more mainstream, that tolerance level drops. He recalled early days of cellphones when users were happy just to have the convenience and dropped calls were an expected part of the experience. Dropped calls are less acceptable, and less frequent, now as mobile phones have matured and are mainstream, he said.

Regarding what lessons can be taken from 3D in 4K’s path to market, DuBravac noted the standard “S curve” adoption pattern of new technology, in which “it takes a long time” for the first 5-10 percent of the market to adopt before the mainstream market buys in. Adoption of 4K technology will be “very low” for the first 5-6 years, he said, while consumers become familiar with the technology, distribution widens and prices reach affordable levels. He urged “measured expectations” for 4K."

In a Q-and-A session, Richard Glikes, president of the Azione Unlimited buying group of specialty AV dealers, said from the audience he thinks 3D failed and failed because it didn’t launch according to conventional industry protocols. Glikes thinks 4K “will be phenomenally successful as opposed to 3D, which was launched through the wrong channels,” he said.

Panelists weren’t enthusiastic about 4K saving the declining TV market. While 4K could benefit from an upcoming buying cycle as consumers look to replace 8-9-year-old TVs in 2014-2015, DuBravac said, Steinberg was less optimistic, citing high prices and exceptionally large screen sizes. He referred to a need to “add functionality” and a need to “pull consumers away from second screens” through apps. “Upping resolution and contrast” aren’t going to be the driving forces of the next generation of TVs, he said. Getting price points below $1,000 and bringing screen sizes below 84 inches are key to taking 4K mainstream, Steinberg said.

Mainstream audio is holding its own and has opportunity for growth, said moderator Jeff Joseph, CEA senior vice president-communications and strategic partnerships, but panelists were doubtful high-end audio would ever return to its glory days. DuBravac referred to a “value proposition” that needs to resonate with consumers, which high-end audio only delivers to a niche portion of the market. Rachel Metz, IT editor for Technology Review, said, “People have forgotten about it,” and with the shift toward portable and personal audio, high-end audio has “taken a back seat.” She also suggested that many consumers default to the earbuds that come with their portable devices because “that’s probably good enough."

Fashion will continue to play a big role in audio, both at the headphone level and at the high-end segment, which is “about as much about aesthetics as it is about performance,” Steinberg said. Where early hi-fi enthusiasts focused on sound quality, the multiple ways users listen to audio today defines the genre more than high performance around a stationary sweet spot. Music today is about portability, streaming, wireless and whole-home, Steinberg said. “As we've added in more facets to that audio experience, some of the early features have fallen by the wayside,” he said.

The other three technologies to watch are technology in education, mobile communications in Africa and 3D printing. DuBravac predicted a 3D printer in every home one day, and Joseph called it a “disruptive technology” for the future. “If nothing else, it teaches the next generation to be comfortable with programming,” DuBravac said.