Rebecca Day

Leica opened its second company-branded store, a gallery and retail boutique in New York’s SoHo neighborhood. The 1,400-square-foot space is designed to “bring the value of Leica to the point of sale,” Roland Wolff, Leica vice president-marketing and corporate retail, told us at the grand opening Tuesday.

Pioneer Electronics is spinning off its unprofitable home AV and optical disc business to create a “leaner organization” and to eliminate “repetitive functions,” the company said in its Q3 fiscal 2013 earnings statement. Pioneer consolidated net sales rose 2.6 percent to $1.1 billion in Q3 ($1 = 93 yen) “despite a significant decline” in sales of optical disc products, the company said. The home electronics group posted an operating loss of $18 million, reflecting lower gross profit on sales of optical disc drive products and cable TV set-top boxes, Pioneer said.

Consumer spending on video rental formats will surpass retail purchases this year for the first time since 2000, the beginning of the transition from VHS to DVD, according to forecasts from BTIG Research. BTIG predicts sell-through spending on video content in 2013 will be 49 percent of total consumer spending on video, a 60 percent falloff from 2009, which BTIG called “a tremendous change in just four years.”

Connectivity and convenience are driving the growth in portable music players, NPD said in an audio report. Wireless streaming speaker sales grew to $262 million in 2012, up from $60 million in 2012 and soundbars with Bluetooth wireless streaming capability grew to $145 million from $21 million in 2011, Ben Arnold, analyst, told Consumer Electronics Daily. “It’s all about the convenience of accessing music from the cloud and not having music to own but to rent,” Arnold said. “More and more people are gravitating to services,” he said, citing Spotify, Pandora and Rhapsody. Standalone MP3 players are taking the hit, as the category saw a 22 percent falloff in sales last year, Arnold said. A “standard downward trajectory” of non-connected music devices has been offset by a rise in music playback on mobile devices to 40 percent of tablet users and 56 percent of smartphone users, Arnold said. Among smartphone users, 39 percent listen to music at least once a day and 54 percent are using phones for music more than they did a year ago, according to the report. Sixty-five percent of smartphone users in the study reported using Internet radio, such as Pandora, while 30 used on-demand services such as Spotify or Rhapsody. Sixty percent also transferred their own music to their smartphone. Tablet users scored similarly on music service playback, and half said the port their own music files to the device, it said. Despite the increase in music listening on mobile connected devices, consumers aren’t using the MP3 players less, Arnold said. “Sales are declining but that doesn’t mean fewer people own them,” he said. The installed base of MP3 player owners still use the devices for specific activities, he said, citing “field use” such as exercise where a less expensive, lighter MP3 player fits the bill. People spend a lot of money on phones and they hold a lot of important information, Arnold said. “If you damage it while exercising, that’s a tough blow.”

Coinstar has dialed back its installation rate for Redbox kiosks amid a slowing physical disc rental market, executives said on the company’s Q4 earnings call Thursday. Coinstar plans to install 500-1,000 additional kiosks “in the right locations,” said Chief Financial Officer and Interim President of Redbox Automated Retail Scott Di Valerio: “The kind of install rate that we're at is probably where we're at.” The company’s kiosk strategy is now about “optimizing the network versus further expansion,” Di Valerio said.

Limited panel supply is contributing to an already slow start for ultra-slim PCs, said a report from NPD DisplaySearch. “The high-end specifications for touch on Windows 8 PCs, and the unproven consumer demand for touch on notebooks has touch screen suppliers leery of shifting capacity from the high-volume smartphone and tablet PC markets to notebook PCs,” said Richard Shim, senior analyst. NPD categorizes ultra-slim PCs as 21mm thick or less in 14-inch and larger sizes and 18mm or thinner in smaller notebooks. Contributing to the supply shortage are production challenges associated with ultra-thin panels, defined as 0.4mm and under, Shim said. Manufacturing panels that thin is difficult and handling and transporting the glass requires special equipment that only AUO and Innolux have been willing to commit to for large-volume production, he said. LG Display is exploring an alternative means to ultra-thin design using its Shuriken self-refreshing panel that requires a change in notebook design “to make the lid slimmer,” Shim told us. That approach requires coordination across the assembly process, limiting the number of suppliers in the chain and making a manufacturer more reliant on fewer suppliers, Shim said. The ultra-slim PC market is expected to reach 44.2 million unit shipments worldwide in 2013, comprising 21.4 percent of the notebook PC market, he said. Although touch capability is being billed as a premium feature for notebooks, consumers don’t perceive it as such, Shim said, because they're accustomed to the feature as standard on smartphones and tablets and don’t expect to pay extra for it. Touch screen penetration in notebooks is expected to reach 13.1 percent this year, or 27.2 million units, he said. Those numbers will gradually rise to 57 percent, or 106.6 million units, by 2017, according to data. The ultra-slim PC category is projected to grow steadily between 2014 and 2015, and eventually establish a standardized high-end notebook PC market, it said. Ultra-slim PCs are not expected to significantly boost PC shipment growth overall but will create a new norm for the high-end of the market, which could help drive volumes, lower costs and make premium notebooks accessible to a broader segment of the market, DisplaySearch said.

ABC’s “C3 ratings” are higher in homes with DVRs, Disney CEO Robert Iger said on Disney’s fiscal Q1 earnings call late Tuesday. C3 ratings, the metric used for how primetime TV advertising is bought and sold, are the average of all commercial minutes watched both live and in three days of DVR viewing. Iger called the ratings “quite interesting,” noting that they include some VOD programming with mechanisms that prevent fast-forwarding, indicating consumers are “clearly looking for access to shows and willing to tolerate some inability to skip through commercials in order to see the shows that they want to watch.”

With inventory remaining and product line turnover looming, some TV makers’ e-commerce sites resemble the fire sale pages of their retailers, we found in a scan of websites Tuesday. In certain cases, manufacturers are out-dueling their retail counterparts by bundling accessories to sweeten the pot.

Super Bowl, the headline event for big-screen TVs, has passed, but retailers were still trying to shove TVs out of inventory at hefty discounts the day after the Super Bowl, we found in a scan of retailer websites Monday. Most of the best bargains were on plasma TVs, with several sites requiring consumers to place models in online shopping carts to avoid violating minimum advertised price (MAP) thresholds. Retailers have gotten around the MAPs by not flagrantly advertising prices that dip below MAP and require shoppers to go through extra hoops to uncover a sale price.

Both sides claimed victory in a ruling by the National Labor Relations Board (NLRB) last week on an unfair labor practice charge filed by Walmart against the United Food and Commercial Workers Union (UFCW) last fall (CED Nov 20 p1). The UFCW used controversial Black Friday work hours as a rallying cry for a nationwide walk-off of Walmart employees in protest of wages, hours, benefits and overall working conditions. Walmart, in response, filed a complaint with the NLRB, seeking an injunction to prevent workers from striking on Black Friday.