Posts Tagged ‘4K’

CES 2015: Upon Further Review…

There’s so much to take in at the International CES every year that you need a few weeks for it all to sink it. I posted my recap of the show earlier this month. Now, I want to expound on a couple of trends I saw in Las Vegas you need to watch. (Let’s move over to the referee’s TV to look at a reply.)

First and foremost is Ultra HDTV. No matter what you think of this next step in television viewing, it is coming, and nothing will stop it. The vast number of Ultra HD models shown at CES by Japanese, Korean, and Chinese manufacturers is all the proof you need. So is the aggressive discounting we’re now seeing on Ultra HDTVs, leading up to the Super Bowl.

Doubting Thomases like to drag out 3D TV as an example of a paradigm that never shifted anything. Not the same thing! 3D was beset by high buy-in costs, competing viewing systems, and a lack of compelling content. (Plus the fact that over 20% of the population can’t even see 3D correctly.) Eventually, Joe Six-Pack judged 3DTV to be an expensive, overpriced, and overhyped gimmick. And he was right.

Ultra HD is different. There are no competing standards for viewing 4K content. You can watch 4K on an LG or Vizio 65-inch TV just as easily as on a Sony or Samsung 65-inch TV. And so many manufacturers are in the 4K game that prices are falling like a stone. You can now buy 48-inch and 50-inch Ultra HD sets for less than $1,000, and 55-inch sets aren’t much more expensive.

Big screens. High dynamic range. More colors. Is this your next TV?

Big screens. High dynamic range. More colors. Is this your next TV?

Hand-in-hand with 4K came some new wrinkles. High dynamic range (HDR) was a topic much bandied about at CES, and now we are seeing multiple TV brands supporting it, usually by incorporating quantum dot (QD) backlight technology or modifying the pixel structure of LCD panels to add more white pixels.

QDs also bring with them expanded color gamut rendering, pushing way beyond the CRT-based ITU BT.709 color space in use today. (OLED TVs, like LG’s new lineup, can also display billions of colors.) Now, we can approximate what’s shown in movie theaters by covering the minimum DCI P3 color space – and more.

High frame rate (HFR) technology is also an integral part of UHDTV. It can refer to rates as low as 48 Hz and as high as 120 Hz. The higher rates would come into play with televised sports and concerts, not to mention virtual reality and gaming. At the lower end of things, 48 Hz could be used to master movies, a la “The Hobbit.”

Finally, the cost of making LCD panels has dropped so low for a myriad of reasons that the incremental difference between fabricating and cutting 2K (1080p) and 4K versions of a 65-inch panel is insignificant. Given the low profit margins – or zero profit margins – in making large 2K glass, it makes more sense to abandon 2K and focus on 4K entirely. And this is exactly what large Chinese panel manufacturers like TCL decided to do over a year ago.

When you see Ultra HD content displayed with full color sampling at high frame rates, you know this is a totally different experience than HDTV. The latter is limited by the BT.709 color space and a handful of frame rates, plus 4:2:0 color encoding. And many HDTVs use 8-bit LCD panels.

Not only that; a display equipped with just 1280 horizontal and 720 vertical pixels is still considered “HD.” Not so with Ultra HD. If it doesn’t have at least 3840 horizontal and 2160 vertical pixels, it ain’t Ultra HD. And that’s why we really should think of Ultra HD as “next-generation television,” and not just “4K.”

Make no mistake about it; Ultra HD will be in wide use very quickly as people begin to understand the benefits it brings to the table. The rapid decreases in retail prices brought along by slower TV sales and competition from the Chinese will only hasten this process.

Like Toyota says: "Let's Go Places!"

Like Toyota says: “Let’s Go Places!”

Now, the other trend: At CES, the UHD Alliance was announced. This is a consortium of TV manufacturers (Panasonic, Sony, Samsung), content producers (Warner Brothers, Fox, Disney, Netflix, and DirecTV), and technology companies (Dolby and Technicolor).

Each has substantial skin in the 4K game: The first three obviously want to sell more televisions, while the studios are looking for more outlets for digital content. And Dolby wants more companies to adopt its high dynamic range Dolby Vision technology, while Technicolor is a player in mastering and distribution.

All well and good, except that not all of the pieces of the 4K “puzzle” are in place yet. SMPTE is still debating, discussing, and moving to adopt a wide range of standards for UHD-1 (up to 3840×2160) and UHD-2 (4096×2160 and above) televisions that touch on data rates, interfaces, frame rates, and color spaces. Similar work is also happening at the ITU.

Without standards in place, anyone can write their own rules for authoring and distributing 4K movies and TV shows, and incompatibility becomes a problem. We don’t even have a 4K Blu-ray player yet – the standards for that format were just adopted and announced at CES, but we won’t see the players and discs until much later this year.

Right now, the most logical path for 4K content distribution is through digital downloads and streaming, although you’d need sustained 15 Mb/s data rates on your Internet connection to make that happen. But Netflix is streaming several shows in 4K. Comcast is getting ready to launch a 4K channel. Other providers such as M-Go and UltraFlix are also providing movies and TV shows via streaming service to Sony, Samsung, and Vizio Ultra HDTVs, plus Nanotech’s Nuvola media player.

Ultra HD also brings along a new version of copy protection, HDCP 2.0. It’s ever more rigorous than 1.4, because it wants to see a secure key exchange in about 20 milliseconds – or it shuts down. (The pro AV dealers and installers are going to LOVE that!) By extension, HDCP 2.0 is incompatible with older versions of HDCP. So that may create a problem for consumers who buy a new 4K TV.

I’ve often said that CES wouldn’t be complete with a raft of announcements about associations, alliances, and consortiums. They’re all well and good, but many are motivated simply to kick up sales of a particular technology or product. The UHD Alliance would be wise to move slowly as standards bodies complete their work so that Ultra HD will be a success. No reason to rush here!

Okay, you can restart the game clock…

CES: The Chinese Electronics Show?

In just a few weeks, I’m off to the International CES, or Consumer Electronics Show, in Las Vegas. CES is one of the world’s largest conventions and last year’s event attracted over 140,000 visitors, according to official CES PR.

I’m not sure how true that was – severe winter weather caused all kinds of flight cancellations in the Midwest and some folks never made it out in time. Still, “the joint was jumpin’!” as Fats Waller used to say. The aisles were certainly packed full of attendees and there were plenty of exhibits to take up my 3.5 days in Vegas.

One thing really stuck out this year. In recent years, more and more Chinese CE brands have been expanding their booth space, but this year featured some booths that were as large if not larger than those of more established Japanese brands like Toshiba, Panasonic, and Sharp.

Microsoft, who used to exhibit at the show, pulled out for 2013 and ceded their booth to Hisense, an industrial manufacturing giant in China. In 2014, the enormous Hisense booth featured TVs in all sizes and resolutions (including 4K), major appliances, computing products, and demonstrations of gesture and voice control.

Behind the LG booth, Changhong and Konka had large booths. The Changhong booth had a miniature city created in detail as the centerpiece of an exhibit of televisions and appliances. One of the latter featured a contemporary multi-range stove/oven combination with built-in LCD TV. In another section of the booth, Changhong showed a simple gesture control system, using a game of virtual darts.

Konka’s booth was distinguished by quantities of 2K and 4K TVs using both LCD and OLED technology. Curved televisions were quite the newsmaker in the Samsung and LG booths last January, but Konka had a few of them, too.

So did TCL, another Chinese conglomerate that manufactures RCA and Sanyo TVs sold in the United States. (They license the Sanyo name from Panasonic.) In addition to OLED and curved LCD displays, TCL showed a 110-inch behemoth with finger-tip gesture control and TVs with Roku functionality built-in.

Other Chinese brands that made the trek to Nevada included Haier (everything from televisions to microwaves and washer/dryer combos), China National Corporation (CNC, again a player in entertainment and white goods) and Skyworth, who showed a full range of TVs; flat and curved.

None of these companies was even on anyone’s radar a decade ago. (Well, maybe a few importers.) But the rise of Chinese manufacturing has led to unprecedented drops in the prices of consumer goods.

A good example would be the LCD TV market. A year ago, Chinese manufacturers determined that gearing up for Ultra HD TV production was a smarter move than chasing such high-priced exotic technologies like OLED TVs. Not surprisingly, they captured considerable domestic TV market share from CE giants Samsung and LG by doing so.

Now, we have multiple sources for various sizes of 4K LCD glass coming out of China, and the pricing we’re seeing on Ultra HD sets through December reflects the impact these 4K panels have had. It wasn’t difficult at all to buy a 55-inch 4K TV for less than $1,000, a price point that last year would buy you a 55-inch 2K TV.

Vizio, a major player in consumer TV, brought out a line of 4K TVs in September and by late November had implemented major discounts. Their P-series 65-inch Ultra HDTV had a list price of about $2,200 when it was announced in January, yet several brick-and-mortar retails stores had it for $1,500 with a bonus soundbar around Black Friday.

It might surprise you to find out just how many electronic devices are manufactured in China, from iPads and iPhones to Android tablets and phones, televisions, so-called wearable fitness electronics like wrist heart monitors, headphones and earbuds, and a plethora of wireless gadgets.

I was initially taken aback to see a large booth in the lower South Hall featuring a full range of commercial AV HDMI matrix switchers, distribution amplifiers, and signal format converters, manufactured by Shiny Bow, an obscure Chinese brand. Then I thought, “Why not? A lot of the stuff we use every day in commercial installs is made in China or at least assembled stateside from components and parts manufactured in China.”

The 110-inch LCD TV I mentioned earlier actually comes from a factory in the province of Shenzen, China, and is a joint venture between Samsung, TCL, and the local government that is formally known as China Star Optoelectronic Technologies, or CSOT. (Samsung also makes a TV that uses this large LCD panel.)

I  think you get the point: China Inc. is becoming a serious player in consumer (and commercial) electronics, and their expanding booths at CES drive the point home. In contrast, some of the brands whose booths used to dominate the Central Hall are shrinking, like Panasonic, Sharp, and Toshiba. (Mitsubishi is gone completely and Hitachi showed more commercial products than consumer last January.)

Given the growing market share of China in CE manufacturing and their ever-larger booths at trade shows, maybe referring to CES as the “Chinese Electronics Show” isn’t as facetious as it sounds…

Ultra HD: A Race To The Bottom?

On September 23, Vizio rolled out its new line of Ultra HD TVs at an art gallery in lower Manhattan. We’d been expecting these to show up ever since pricing was announced way back at CES in January, and there weren’t any real surprises in the lineup: Five models, ranging in size from 50” to 70” with 5” (diagonal) increments.

Unlike recent Ultra HD product launches from Seiki and TCL, the Vizio lineup sent a few tremors through the industry – in particular, at Samsung, LG, and Sony. Consider that each one of the Vizio TV models is a “smart” TV, and each uses full-array LED backlighting. You’ll find a bevy of HDMI 1.4 connectors on all of them, along with a single HDMI 2.0 interface. And the sets support HEVC H.265 decoding, too. (Can you say “Netflix 4K streaming?”

In other words, these aren’t bargain-basement models, like the aforementioned Seiki. But what will raise a few eyebrows is the retail pricing: The 50-inch P502ui-B1 retails for $999, while the 55-inch P552ui-B2 goes for $1,399. The 60-inch P602ui-B3 is ticketed at $1,699, while the 65-inch P652ui-B2 will cost $2,199. And the “top of the line” 70-inch P702ui-B3 will be available for just $2,499. (All prices are in $ USD)

To see exactly what impact that could have on the market, look at current prices for Samsung and LG 55-inch Ultra HDTVs. The current HH Gregg sales flyer for October 5 shows Samsung’s UN55HU6950 55-inch Ultra HD set for $1,599, and that represents quite a drop in price over their previous 55-inch model – about $1,400.

LG also started lowering prices on its Ultra HD sets in the late spring. Their 55-inch 55UB9500 Ultra HD set is now listed at $1,999, which is also a big markdown from earlier this year. How about Sony? The HH Gregg flyer shows the 65-inch XBR65X850B with Triluminous quantum dot backlight (by QD Vision) for $2,999, which (according to the flyer) represents a $1,000 discount. That’s still $800 more than the comparable Vizio model, which uses conventional LED backlights.

So why should any of this matter? Simple: Vizio is an established national brand that has enjoyed strong sales in large LCD TV screen sizes for several years. And they’ve expanded from their original bases in Costco and BJs to Wal-Mart, Sears, and now Best Buy.

That latter brick-and-mortar chain is where Samsung, LG, and Sony have been running an aggressive in-store promotion for Ultra HDTV since early August, playing back clips of 4K footage and raffling off Ultra HD TVs in an attempt to stir up business. TV sales have declined worldwide for the past two years and the major TV brands are clearly hoping that Ultra HD will re-start the engine.

The decline in Ultra HDTV prices has been breathtaking, to say the least. One year ago, you could expect to shell out upwards of $4,400 to buy a new Samsung or Sony 65-inch Ultra HD set. 55-inch models were retailing for about $1,000 less. And now Vizio has pulled the rug out from under its competitors with a line of 4K sets that looked impressive at the NY event.

What does this mean for Ultra HD TV pricing down the road? Given the scramble to find any profit in manufacturing 2K LCD glass – a challenge even for the Koreans – and the determination of China to be a major player in 4K glass manufacturing, we can expect prices to drop even lower by next year’s Super Bowl. Right now, you can buy a nice 55-inch 2K LCD TV for $600, and I’d expect a 4K version to sell for just under $1,000 by late January.

Long term, the profit in manufacturing 2K LCD glass will mostly evaporate, leading fabs to switch to 4K glass for larger TV sizes. As a consequence, you will see most TVs larger than 55 inches utilize 4K resolution glass in a few years, just as the industry shifted from 720p and 768p panels to 1080p glass in the mid-2000s.

According to NPD DisplaySearch, more Ultra HD sets were sold in the second quarter of 2014 (2.1 million) than in all of last year (1.3 million). But we’re still talking about a small percentage of all TVs sold worldwide in 2013 (208 million). So it is surprising to see price wars already starting up this early in the game.

Who will blink next?

Well, Whaddya Know!

It’s late July, and the summer doldrums have definitely arrived. The flow of press releases has slowed to a trickle, and all kinds of strange stuff arrives in my mailbox several times a day – most of it destined for the recycling bin. Even so, there are a few stories worth mentioning.  Let’s take a quick glance.

The tables have turned: Remember when your parents limited the number of hours of TV you could watch in a day? Well, it appears Millennials are self-regulating, when it comes to the boob tube.  According to a story on MediaPost from last Thursday, Nielsen has discovered that the number of hours spent viewing traditional TV continues to decline year-over-year for this demographic.

Nielsen’s current numbers show that the average Millennial watched a little less than 22 hours of traditional TV, per week, during the first quarter of this year. That’s a decline of 14 minutes per day from Q1 2013. In contrast, their parents (50 – 64 and 65+) watched more than twice that amount at 45 and 52 hours, respectively. (Well, us Baby Boomers grew up with television, so maybe that’s not surprising.)

Much ado about nothing? Aereo, the renegade broadcast TV-over-IP “antenna” service that lost a major ruling in the U. S. Supreme Court last month, flip-flopped in its assertion that it wasn’t a cable TV system and insisted it was, applying for a license to broadcast copyrighted content from the U.S. Copyright Office. But Aereo’s request was just turned down by that august body, putting its future into limbo.

Now, a story on the GigaOM Web site suggests that Aereo had maybe 100,000 subscribers at most. How do we know that? Well, as part of its application to the U.S. Copyright Office, Aereo submitted a payment of $5,310.74 to cover “royalty and filing fees” from January 2012 through the end of last year. Using some basic assumptions about Aereo (such as its monthly subscriber fee) and royalty payments of .33 to 1.064% of gross profits, law professor Bruce Boyden backed into a guess of around $1 million gross revenue for that time period.

That’s not a great ROI for the time and investments Aereo made, and the article stated that, even if all of the $1M in revenue came in 2013, it represents only 10,000 subscribers.  We’ll have to see what the next steps are, pending more hearings in court next month.

Not selling like hotcakes, Part I: Apple’s recent financial results show that the company sold 35.2 million iPhones in Q2 2014. That’s up over 12% Y-Y and was largely driven by a big jump in sales in Brazil, Russia, India, and China, a.k.a the BRIC countries. Good news, but offset by the fact that iPad sales dropped 9.2% in the same quarter. That follows a 16% decline in iPad sales in Q1 2014. What’s going on here?

One obvious answer is that consumers don’t turn over their tablets quite as often as their phones. I’ve seen other research that shows a retention rate of 2+ years for tablets, which implies satisfaction with these products. But that doesn’t help Apple’s bottom line, which is why they’re pushing into the “wearables” market – and just got a patent for a new smartwatch called iTime that features sensors, in-strap circuitry, and support for arm and wrist gestures, according to the ETCentric Web site. Will it offset declining iPad sales?

Not selling like hotcakes, Part II: Finally, from the Home Media Web site, we get a story that says “UHDTVs are underwhelming at the marketplace,” based on market research by HIS. The share of UHDTV shipments among the top 13 LCD brands reached 5% in May, up from 4% in April, 3% in March, and 2% in February. (Hmmm…so, they’ve increased by more than 100% in three months? That’s not too shoddy!)

IHS goes on to state that “UHDTV pricing remains too high to gain meaningful market share.” Well, duh! Until recently, all Japanese and Korean UHDTV sets in the 55-inch class were priced close to $3,000, and we know that’s a non-starter. But LG recently cut its 55-inch 4K LED TV to $1,999, and Vizio will be launching a 55-inch 4K LED for just $1,300 in the fourth quarter.

HIS analyst Jusy Hong was quoted in the story as saying that UHDTV shipments will increase to 14.5 million by the end of the year, up from a paltry 2 million in 2013 – and that’s nothing to sneeze at.  Samsung and LG are the kingmakers here, accounting for 46% of all UHDTV shipments in May. In contrast, the “big six” Chinese brands – Haier, Hisense, Skyworth, TCL, Konka, and Changhong – captured a combined total of 45% market share in UHDTVs.

Gotta run! The reclining chair and an ice-cold glass of lemonade are calling…

Of Phablets and 4K

Lately, trying to predict sales trends is like shooting at a moving target. And just when we think we have a market segment figured out, it turns in a new direction.

So it goes with the shipments of tablets, which most analysts had pegged to grow by 20% in 2014 over last year. But hold on – a recent report from IDC has dropped that number to 12% after Q1 shipment numbers came in.

In a January press release, IDC had predicted that tablet shipments would hit 270M units this year. At some point, that number was revised downward to 261M units. Now, IDC is forecasting 2014 shipments will drop to 245M units, based on lower-than-expected Q1 results.

What’s the reason for the fall-off? IDC states one obvious cause: People are keeping tablets longer than expected. Unlike smartphones, which are usually recycled every two years (the length of the typical service contract and phone battery), many older tablets are still in service. My wife still uses her iPad 2 daily, and I’ve gotten two+ years out of my Nook HD tablet.

IDC also found that older tablets are often “handed down” to another family member, which represents another lost sale. The vast majority of tablets are using conventional Wi-Fi connections to get data, which means they aren’t sold with annual contracts for LTE service.

But there’s another factor that IDC identified, and that is the growing popularity of large smartphones, or “phablets” as some wags have named them. Phablets are phones with screens larger than 5 inches, although IDC prefers to start the category at 5.5 inches. These gadgets can do everything a tablet can (plus make phone calls and send/receive texts), and many consumers find they’re large enough to stand in for a tablet screen.

The phablet category really took off when Samsung’s Galaxy smartphones broke the 5” screen barrier over a year ago. At the time, many analysts predicted that screen size would be too large for consumers. Guess what? They’ve been flying off the shelves. And now we’re starting to see 6” smartphones from the likes of LG and HTC. (LG even has a curved model, the G Flex.)

LG's new G-Flex curved phone has a 6-inch screen. Too big? Apparently not!

LG’s new G-Flex curved phone has a 6-inch screen. Too big? Apparently not!

IDC’s research states that smartphone shipments (30.1 million units) increased from 4.3% in Q1 2013 to 10.5% in Q1 2014. Consequently, shipments of larger tablets (8” – 11”) are expected to increase this year by 3% over 2013, while 7” – 8” tablets will see a decline of 5% in the same time period.

Even though phablets are pushing the limits of screen sizes, they’re finding a sweet spot with the public. The same thing appears to be happening on a smaller scale with 4K (Ultra HD) TVs, which IDC also tracks.

According to their research, worldwide 4K TV shipments reached over one million per month in March and are expected to hit 15.2 million for the full year. That’s better than most analysts expected, given the low awareness of 4K by the general public. IDC also found that the average selling price for Ultra HD TVs has fallen 86% since 2012 (when there were a handful of models) from $7,851 to $1,120 at the end of March.

According to a new report from Business Insider Market Intelligence, 4K TV sales are largely propelled by low prices in China, where many fabs are moving to 4K LCD panel production and leaving low-margin 2K panels behind. Indeed; the BI press release identified the Chinese market as “most accessible” for 4K TV.

In North America, BI predicts that 10% of all households will have at least one 4K TV by the end of 2018, and that worldwide shipments of 4K TVs will hit 11 million units by the end of 2016. We’ll no doubt see Korean manufacturers switch over to 4K LCD panels in larger sizes within two years, as the profit margins on 2K glass have dwindled to almost nothing.

There’s a precedent for the move to 4K, and that is the transition almost eight years ago from 720p/768p display resolution to 1080p. Now, history is repeating itself, and it’s likely that LCD TVs larger than 55” will all be Ultra HD in short order.

Have your doubts? At CES, Vizio announced a fall line-up of Ultra HD Smart TVs with eye-popping prices, such as a 50” model for $999, a 55-inch version of just $1,300, and a 65-inch offering for $2,200. Those prices aren’t much higher than what “loaded” smart 3D 2K LCD TVs command now. Vizio will even have a 70-inch 4K set for $2,600!

Consider also that Chinese manufacturers are setting up shop to build LCD TVs close to the US market. Last month, TCL purchased Sanyo’s TV manufacturing facility in Tijuana, Mexico, giving it a big advantage over other Chinese brands in shipping and tariffs. And you can bet that 4K Ultra HD TVs will be rolling off that line in the not-too-distant future.

By the way, 4K and phablets have already intersected. At least five new smartphones support native 3840x2160p/30 video recording; among them Sony’s Experia Z2, Samsung’s Galaxy Note 3 and S5, LG’s Optimus G Pro, and Asus’ Liquid S2. And three of them fall squarely into the phablet category, providing me with an appropriate wrap-up to my story…