Consumers Intrigued by 4K, But Sales Slow as Content Lags, Specialists Say

Interest in 4K is high among consumers but sales are slow as they await content and signs of staying power, specialty dealers told Consumer Electronics Daily. “People seem to be genuinely interested in 4K,” said David Berman, vice president-sales and operations, at Stereo East, Frisco, Texas. The store has sold two 4K projectors but no flat-panel models in the few weeks they've been on display, Berman said, as customers take a wait-and-see attitude. “Consumers were so burned by 3D that they're unsure that 4K is anything other than a fad at this point,” Berman said. Now that the Sony $5,000 55-inch and $7,000 65-inch are available, Berman is hoping the lower price points -- versus the $25,000 84-inch that launched the format -- and “spectacular picture” will spur business and generate word-of-mouth interest.

Specialty AV store The Sound Room, Chesterfield, Mo., has been demoing 55-inch and 65-inch Ultra HD 4K models from Sony since June 1, but “sellthrough’s not that good,” said President David Young, who has yet to sell a model despite “a lot of interest.” The primary factors holding back Young’s early-adopter clientele are “the question of content” and delayed shipments of the second-generation server that will come preloaded with 10 native Blu-ray movies (CED July 3 p1), he said.

The Sony 4K Media Server was due in stores last week but was held up, and Young is holding out hope for delivery in the next couple of weeks. Sony didn’t respond to our questions about a shipping date for the server. While Sony is discounting the $699 server by $200 for customers who buy 55- or 65-inch 4K TVs, Young isn’t convinced consumers will be willing to pony up another $500 for a crack at a limited library of movies on a server. “I think they should throw it in for free and charge for the downloads,” Young said.

Another inhibitor in the first-generation Sony 4K TVs is the look of the TV’s audio system, Young said. Young acknowledged the large drivers on either side of the Sony 4K displays -- two midrange drivers stacked above and below a high-frequency driver -- produce better sound than the typical flat-panel TV, but they add undesirable width to an already large 55- or 65-inch TV frame. Worst of all, he said, they come with no grille covers to conceal them. “The look limits where those TVs can go,” Young said, citing customers who have been put off by the “big honkin’ speakers” in the TV frame. “Everybody is looking for the frameless look,” he said. Berman of Stereo East had similar reservations. “Everybody hates it,” Berman said of the side-loaded speaker array. A few Stereo East customers have commented on the “different” approach to audio from a flat-panel TV, “but they wouldn’t buy it,” he said.

The speaker design arose out of focus groups where consumers said they wanted better sound from a flat-panel TV, Young said. But specialists have reservations about the augmented audio for two reasons, he said: The look isn’t one that appeals to high-end customers, and built-in speakers negate the need for an add-on sound system, which is a way for specialty dealers to make more profit on a sale. Upcoming 55- and 65-inch models due out in October won’t have the fortified speakers, dealers said.

Audio Advice in Raleigh, N.C., has had “expected” success with the Sony 55- and 65-inch Sony 4K TVs, after being one of the first dozen dealers to be awarded the 84-inch when it shipped, Audio Advice Chairman Leon Shaw told us. Shaw credited good dealer support for Sony in helping to fund 4K events at the Audio Advice dealership, which has attracted early adopters. “We're fired up” about 4K, Shaw said, and the enthusiasm has carried over to existing customers who have been waiting for a video advance beyond 3D, he said. The 55-inch and 65-inch have filled the needs of customers who wanted next-gen resolution without paying $25,000 to get it in an 84-inch model, he said. Shaw declined to tally the number of Ultra HD sets Audio Advice has sold, but Shaw called it a “decent” number.

On the side-mounted speakers, Shaw said the store has come up with a “creative solution” to hide them, but he wouldn’t disclose the strategy for competitive reasons. One customer, whose existing AV system combined a Bowers & Wilkins Panorama sound system with an XBR TV, saw the 4K side-loaded speaker system “no worse” than his existing solution, Shaw said. The rest of the 4K upgrade customers planned to use the TVs with their current surround-sound systems, he said, without addressing how the customers will conceal the exposed drivers of the TVs.

At Plainview, N.Y.-based Audio Video Systems, Chief Operating Officer Franklin Karp assumes the speaker issue will be addressed in the next generation of TVs when his custom electronics business is ready to install TVs being specified for jobs under construction now. But Karp wondered if clients had actually seen the models that are currently available, adding, “What was Japan thinking?” about the exposed drivers. Size and design are primary purchase factors in custom purchase decisions, he noted.

A looming issue for 4K TVs is that most current AV receivers can’t pass through a 4K signal, and dealers praised Sony’s dual HDMI-output solution for its server that addresses the problem. “How would you wire it into your system?” Shaw said, if there weren’t a dual-output option. Sony’s 4K Media Server sends out two HDMI feeds: one that runs directly to the TV and the other that goes to an AVR, he said. “They nailed it,” Shaw said.

At Best Buy’s Magnolia Home Theater store in Chesterfield, Mo., 4K TVs on display are “the latest buzz,” said General Manager Scott Roseberry. He referred us to Best Buy corporate for sales information but noted that prices will move closer to “core” and become more appealing as more manufacturers bring product to market. On customer reactions to 4K so far, Roseberry said one customer asked if the speakers could be removed on the 84-inch set (the answer was yes, he said), and on lack of content sales people are comparing the content situation to that of HD at its onset. Meanwhile, the store is focusing on demos of existing content to show off the TV’s upscaling capability, he said. “They show existing content amazingly well,” he said. Questions to Best Buy on 4K sales weren’t answered by our deadline.

Bjorn’s in San Antonio, Texas, has created a store bundle for the 55- and 65-inch Sony 4K TVs, according to the retailer’s website. In addition to getting a trio of native Mastered in 4K Blu-ray titles and the Sony-sponsored one-year subscriptions to Hulu Plus and Netflix, consumers who buy one of the two 4K TVs get a choice of an add-on valued at $300 from Bjorn’s: an Omnimount wall mount and installation; $300 toward the price of a subwoofer to go with the TV’s speakers; or free local delivery and three-year extended warranty.

Sony is offering its own bundles on its e-commerce site for buyers of the 55- and 65-inch 4K models. The 65-inch bundle, which Sony valued at $1,100, includes a free wall mount supplied by Chief, with installation, and the same media offerings for 4K movies and subscriptions that it has negotiated for its retailers. For the 55-inch 4K model, which Sony values at $939, the company is offering a Proforma TV mount with installation, along with the content selection. Sony is also offering 36-month financing through its website.