Rebecca Day

DTS’s recent efforts to work with tools and infrastructure providers to make DTS deliverable via the cloud have paid off with the announcement in April that CinemaNow would be delivering content encoded with DTS, and with Tuesday’s announcement that Paramount Studios will encode its library of UltraViolet movies available in Common File Format (CFF) with DTS-HD surround sound, said CEO Jon Kirchner. Kirchner called DTS-HD an “efficient and scalable solution” that crosses multiple listening environments from multi-channel home theater surround sound to two-channel TV sound and the headphone space, where “some of the most innovative work” is now occurring, he said. “There’s a tremendous opportunity for improvement in the marketplace to enhance entertainment” from smartphones, tablets and PCs, he said.

The death Friday of Amar Bose, 83, founder and chairman of Bose Corp., elicited a range of reactions among audio industry executives we canvassed for opinion on his passing and his impact. Virtually all praised Bose as a departed icon, even if they as former retailers didn’t exactly relish selling his products -- or competing against them.

Specialty AV buying groups are showing urgency in developing progressive marketing programs, as they attempt to push reluctant dealer members who cut their retail teeth on walk-in traffic and make them adapt for the more labor-intensive demands of the digital marketing age.

Back-to-school electronics specials kicked in quickly on the heels of Fourth of July deals, we found in a scan of e-commerce sites. In the struggling PC segment, retailers are using sub-$300 pricing to reel in students prior to the start of school. Office Depot is issuing a $79 rebate in the form of a prepaid Visa card to college students who buy both Microsoft Office 365 and a qualifying Windows 8 PC. The deal runs through July 13 and requires proof of student status via a valid college photo ID or an original copy of an acceptance letter to a college or university, with another form of photo identification, it said. Qualifying PCs Thursday included the Acer Aspire 15-inch V5-571P-6472 laptop with a touch display that’s marked down from $649 to $499. The other PC option in the promotion is an HP Envy TouchSmart 23-inch all-in-one computer that’s been discounted from $949 to $749.

Sony’s competitive promotion on its e-commerce site, offering a free TV mount and installation with the purchase of an Ultra HD 4K TV, spurred independent AV retailer Bjorn’s in San Antonio to offer a similar deal, President Bjorn Dybdahl told us. “It’s been a help,” Dybdahl said, saying the store has “been doing well with 4K all along” following its launch of the 84-inch model in October. Bjorn’s decided to do its own promotion when a customer told a store salesperson about the deal on the Sony website. “We wanted to be in the ballpark with Sony,” Dybdahl said, so he contacted the manufacturer and “they made it possible for us to be competitive,” he said. Bjorn’s will run its promotion as long as the Sony promotion is in place, he said. “We've been pleased with the number we've sold,” Dybdahl said. As a harbinger of new video technologies, Bjorn’s was a cheerleader for 3D “before 3D was a reality,” doing promotions with Mitsubishi and Texas Instruments to promote the technology, Dybdahl said. “We were excited about 3D,” he said, until major TV manufacturers launched 3D through Best Buy, he said. “We couldn’t get flat-panel product because it rolled out through Best Buy and made us all look bad,” Dybdahl said. Like other specialty AV dealers, Dybdahl blames 3D’s flatlining partly on the mass-market launch instead of through specialists who could provide the education a new technology needs. Now with the industry looking to 4K as the next savior for the price-battered TV market, Dybdahl is hopeful 4K will bring the margins and consumer excitement that 3D didn’t. Conceding it’s early to get a feel for mainstream consumer reaction to high-priced Ultra HD TVs, Dybdahl said he’s seen something in 4K that’s attracting customers even without native 4K content available. The store held a demo showing a Sony 4K TV against a flagship Samsung LED-lit 1080p model, and consumers overwhelmingly chose the 4K model, he said. Dybdahl was particularly impressed that viewers in the back of the room saw a difference in the two displays, since reviewers have said users should sit close to a 4K TV to appreciate its benefits. “There’s something about 4K that’s drawing people to it, and it’s not the fact of having to sit close,” he said. The demo was done with upscaled material and with both TVs tweaked to the highest performance settings, he said. On rumored OLED 4K models coming to market this fall, Dybdahl predicted customer confusion as they are confronted with the new 4K and OLED technologies. “Like any new, revolutionary product, we'll go with it and sales will dictate what direction the market goes,” he said. “Cost will play a role in that,” he said. “We'll be involved with both.”

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.

Some 71 million tablet owners will make purchases via their device this year, compared to 53 million buyers using smartphones, according to eMarketer forecasts. By percentage, 63 percent of tablet users will make a purchase using their device versus 39 percent via smartphone. The market research firm calls 2013 the year of fragmentation in the mobile device category in which diverging use cases on smartphones and tablets mark the end of mobile devices as a “monolithic” category. By 2017, eMarketer predicts, 125 million tablet owners will make purchases on their devices and 90 million smartphone owners will buy through their phones.

General Motors’ announcement in February that it would deliver a majority of vehicles beginning mid-2014 with embedded 4G AT&T connectivity broadened the visibility of embedded solutions beyond the luxury vehicle market, said panelists at the Connected Car Conference in New York. Geoff Snyder, director of automotive business development for Pandora, called GM’s decision an “exciting test bed for mass-market availability of embedded connectivity in the car.”

Forty percent of smartphones returned through the supply chain are “no-fault-found” returns, Jim Hunt, senior vice president, business development at Genco, a third-party logistics provider for the CE channel, told Consumer Electronics Daily. Genco, which handles the product returns for AT&T Wireless and U.S. Cellular, makes “plug-and-play” repairs to phones including jack and display replacement, but not soldering work, Hunt said. The company is working with carriers on what Hunt calls a “recent phenomenon” owing to increasingly sophisticated phones. “Four out of 10 phones that are returned don’t have anything wrong with them,” Hunt said. He described a “fairly significant level of buyer remorse” due to customers not understanding the complexities of the latest generation of smartphones. “It’s easier to say it’s broken than to admit they don’t understand how the phone works,” he said. The occurrence is particularly evident with Android phones because of the open architecture that allows users to download “any number of things,” he said. Games are a major culprit because they consume a lot of storage, and the closer a phone comes to reaching storage capacity, “it slows down to nothing,” said Hunt. “They come back and say the phone isn’t working so take it back,” he said. Under the current retail model, the staff members at wireless stores are motivated to sell accessories, not provide customer support, he said. “It’s easier to take the phone back and give them another phone rather than help a customer resolve an issue,” he said. Hunt worked with a consulting company to determine the cost of no-fault-found returns to carriers and found “a $100 bill gets wrapped around every one that loops its way into the return process.” OEMs don’t assume responsibility for the returns because they're not due to defective product, so “carriers are absorbing cost and it’s killing them,” he said. Genco is seeing fewer returns because phones have a longer life cycle than they did three or five years ago. “If you look at Samsung and Apple phones, fewer folks are flocking to the next new model than they did three years ago because the changes are more incremental,” he said. “People are holding on the units longer.” Genco gleaned that through the number of returns it sees from AT&T and U.S. Cellular due to fewer phones being sold, and less “repair incidence” per phone due to smartphones that are “more robust and sustainable,” he said.

The Fourth of July is yet another opportunity to promote consumer electronics deals, we found in a scan of e-commerce sites Wednesday. Skullcandy used the holiday theme in its “Celebrate Freedom” promotion, which offers free shipping with no minimum purchase requirement through its online store. Free shipping applied to a pair of $14.95 earbuds as well as the $349.95 New York Yankees Mix Master DJ headphones with microphone, the highest priced phones on the site.