Posts Tagged ‘LCD’

Goodbye Flo, We Hardly Knew Ye

Last Tuesday, Web outlet paidContent.com broke the story that Qualcomm was preparing to shut down its underperforming FLO TV business unit this coming December.

FLO TV, for those readers who’ve never heard of it (and that’s a large group, apparently), is a proprietary subscription mobile TV service that broadcasts nationwide on UHF channel 55. The service, also bundled as a ‘white label’ wholesale product to Verizon and AT&T subscribers, delivered several channels of TV programming specifically formatted for mobile and handheld devices.

Among the networks offered to FLO subscribers were Fox, CBS, NBC, ESPN, MTV, Nickelodeon, and CNN. The service first launched in 2006 as MediaFLO, and picked up Verizon (VCAST) and AT&T Mobile as re-sellers in 2007.

The FLO will be cut off in December…

Unfortunately for Qualcomm, FLO never caught on with Verizon and AT&T customers. Customers didn’t care to watch movies and long-form programming on cell phones, opting instead for ‘snacking’ on news and sports clips.

The result was a decision to market the service directly to consumers in the summer of 2009, with big box stores including Best Buy and Radio Shack offering a 3.5” LCD FLO TV receiver for $250, along with a $9 per month service contract with a three-year commitment.

The total out-of-pocket expense to watch 12 channels of programming – $570 – was not appealing to potential customers, particularly with the new ATSC MH mobile digital TV service getting off the ground. Why pay all that money when you could potentially access thousands of digital TV stations across the country for free?

Another strike against FLO TV: It didn’t offer any local news, weather, and sports broadcasts, which are the three biggest drivers for mobile media consumption. To make matters worse, smart phones were already providing Web access to video content providers like Netflix and Hulu, not to mention Web podcasts of sports, news, and weather programming; all on a flat rate data plan that also included email access. That’s not a battle Qualcomm could hope to win.

Ironically, FLO viewership numbers surged with ESPN’s coverage of the 2010 World Cup as the obituary was first being drafted back in June. But it was a case of too little, too late.

Nice try, but no cigar.

Qualcomm’s plans for what’s left of FLO TV and its nationwide network of over one hundred channel 55 TV transmitters (and in some markets, channel 56) aren’t clear yet. But there doesn’t seem to be a lot of hand-wringing coming from the San Diego corporate headquarters.

That’s because Qualcomm acquired the UHF spectrum relatively inexpensively earlier this decade, and now feels that the channels are worth at least $2 billion today, based on current spectrum auction results.  So they can sell off their real estate and still pocket a nice piece of change for their efforts, which among other things included relocating (at Qualcomm’s expense) a few UHF TV stations broadcasting on channel 55 prior to the analog TV shut-down in June of 2009.

Is there a market for subscription-based mobile digital TV? It would appear not. And there’s no guarantee that the free MH services just getting off the ground will be sustainable, either.

But in a day and age of customers feeling they are being ‘nickel-and-dimed to death’ for cable and satellite TV, Internet access, cellular phone service, and landline telephone service, FLO TV never stood a chance.

Shades of Crazy Eddie…

Tomorrow (Saturday, October 2), 6th Avenue Electronics will celebrate the opening of their new store in Deptford, NJ with a chain-wide blow-out sale on TVs.

And when I say blow-out, I mean BLOW-OUT!

Can’t beat that deal with a stick!

Here’s what caught my eye this morning: 350 Panasonic TCP42C2 42-inch 720p plasma TVs will be sold for $397.95, a discount of $200 from full retail. And if you want something bigger, 250 Panasonic TCP50C2 50-inch 720p plasma TVs will be tagged at $548.95 each – almost $250 off their normal retail price.

There are other goodies to be had. Want an LG 50PK250 1080p 50-inch plasma TV? Get there early enough, and it’s yours for $788. How does an LG 60PK250 60-inch 1080p plasma TV sound for $1188? Or a Panasonic TCP58S2 58-inch 1080p plasma for $1198?

If LCD’s your thing, you can scoop up a Samsung 46-inch 1080p LCD TV for $648, or a Toshiba 46G300 1080p LCD TV for $749. 6th Avenue’s also got a Toshiba upconverting DVD player for $29.95 and a Panasonic Blu-ray player for $100.  The flier in today’s Philadelphia Inquirer goes on to list all kinds of electronic goodies for rock-bottom prices, including a $80 netbook with 7″ LCD screen, an Olympus 10 megapixel digital camera for $65, and a JVC 8 MP pocket movie camera for $70.

Face it. All electronics are commodity products nowadays. No wonder so many TV manufacturers are struggling to make a buck!

Can’t wait to see how low prices go on Black Friday…

Toshiba TVs: A Fade to Black? UPDATED

EDITOR’S UPDATE: Toshiba has indeed begun the process of moving its Wayne, NJ consumer products division to Irvine, California; integrating it with the company’s IT division. A press release detailing this move (which I missed, whoops!) came out on May 6, 2010.

Yes, Toshiba is following Samsung’s lead by consolidating the offices and operations of its consumer and professional divisions. But that’s only a sidebar to what is potentially a big (and perhaps insurmountable) problem facing the company, and that’s a slow and steady decline in market share among LCD TV brands.

According to an August 18th press release from industry analyst Riddhi Patel of iSuppli, Toshiba’s LCD TV market share in the United States has shrunken from 7.4% with 570,000 TVs shipped in the 2nd quarter of 2009 to 5.5% with 402,000 shipments in Q2 of 2010.

That’s not an insubstantial number. To put that into starker terms, Toshiba’s LCD TV shipments have dropped by almost 30% in one year, which should be sending up a huge red flag in the company’s executive offices…wherever they wind up next.

What is also alarming is that Toshiba’s market share has now fallen into Pioneer and Hitachi territory from 2007 and 2008. A few years ago, Pioneer had a 7% share among plasma TV shipments that dropped to about 5% within a two-year period (while the company was also hemorrhaging red ink). By late 2008, they had decided to throw in the towel and exited the plasma TV business in the spring of 2009.

Remember Hitachi? They once led the market in rear projection TVs and made some top-notch CRT sets, too. Hitachi was also a leader in plasma technology, building an enormous plasma fab on the island of Kyushu with partner Fujitsu in 1999.

Today, that plant is largely superfluous, as the company has withdrawn from selling plasma TVs. And you won’t find any Hitachi LCD TVs at Best Buy, or HH Gregg, or Wal-Mart, or Sears (they do have some nice Hitachi electric drills, though!).

Looking through the Amazon.com Web site, I found a handful of Hitachi sets that are either the last left in stock, or used models.  (And the company was conspicuous by its absence at CES 2010.)

The iSuppli report lists the current top five LCD TV brands as Samsung, Vizio, Sony, LG, and (surprise!) Sanyo, leaving Toshiba in the #6 slot. That’s quite a fall, as they were ranked #4 in Q2 of 2009. Panasonic showed up at #8 with a 3.1% market share, but their core business in plasma TVs.

Another shocker: Sharp, once the leader in LCD TV sales, brought up the rear with a 2.4% share, a decline from 4.7% in Q2 of 2009 and a drop in Y-Y shipments of 49%. Yikes! (Is Sharp on the LCD TV endangered species list, too? That’s another story for another time…)

Given all of the LCD fab capacity in Asia and indications of LCD TV oversupply in the channel, the logical result is another round of price wars. That’s a game that Toshiba can’t compete in, because they don’t manufacture LCD panels, and would have to do some serious shopping in Taiwan and China to keep manufacturing costs down.

However, three of the five brands ahead of them do make LCD panels  (Yep, Sanyo does make LCD panels, although they also buy glass on the open market), the exceptions being Vizio and Sony. But Sony is still sitting pretty because they are major investors in both the Korean S-LCD Gen 7 joint venture fab with Samsung and Sharp’s new Gen 10 LCD fab in Kameyama, Japan. (Sony owns about 34% of the Kameyama factory and a corresponding amount of the LCD panel output.)

Toshiba was one of the first companies to introduce LED backlights in their TVs. In fact, they were one of the first companies to use the term ‘LED TV,’ thereby creating instant consumer confusion about perceived differences between LCD and LED TVs.

The past decade hasn’t been kind to Toshiba. Their prized HD-DVD technology was vanquished by Sony’s Blu-ray format (supposedly with the help of a $400 million dollar payoff to Warner Home Media), and the crown jewel – the DVD format – is showing its age and in decline.

Toshiba was one of the few companies to show working 3D TV sets with active shutter technology at CES 2010. And their Cell TV architecture (co-developed with Sony) is a powerful platform on which to build next-gen TV designs that can stream multiple channels of HDTV programs and incorporate hand gesture recognition for operation and control.

But all of that may be for naught, if this negative market share trend continues.  It doesn’t help that Toshiba is perceived as a ‘mid range’ TV brand now, according to what an industry colleague heard when he recently visited several Best Buy stores in southern California and could find only two models of Toshiba LCD TVs for sale.

The marketplace is indeed a harsh mistress…

3D: Expect a Long Slog

3D: Expect a Long Slog

It took nearly seven years before HDTV really took off. So how can we expect 3D to launch in less time?

There’s been a lot of discussion lately in the trade and consumer press that 3D is at danger of falling back into a novelty entertainment category.

Several prominent movie directors (among them J. J. Abrams) have come out against the format. Christopher Nolan (Inception) said it was too dark. And sloppy 2D-to-3D conversions, such as Clash of the Titans, may scare some people away from the format.

There’s also anecdotal evidence that the initial fascination that movie audiences had with 3D is starting to wear off. The premium for a 3D ticket can be anywhere from $3 to $5, depending on the theater chain and location. And experiences like Titans will make consumers gun-shy about spending 25% to 40% more for a 3D presentation.

But that’s a movie theater issue. What CE manufacturers want is for 3D to take off like HDTV did, back in the late 1990s.

The only problem with that thinking is that HDTV did not take off in the late 1990s at all! As a matter of fact, it moved at a glacial pace for quite a few years.

I installed my first HDTV (Princeton Graphics AF3.0HD) in the fall of 1999, and connected it to a Panasonic TU-DST51W set-top box and antenna to watch a smattering of HD movies on Saturday nights (ABC) and a few sitcoms and hour-long dramas (CBS), along with Monday Night Football games (ABC again).

My TV market (Philadelphia) didn’t have a full slate of HD content available on the top four networks until 2003, five years after the first HDTV stations lit up. Remember NBC’s experimental HD coverage of the Winter Olympics in February of 2002? Remember the Fox network’s 480i ‘high-resolution digital TV?’ in 2000 and 2001?

The fact is; HDTV set sales didn’t hit their stride until the third and fourth quarters of 2005. That’s when the price wars began in earnest and the HD DVD – Blu-ray war was just starting up.  (Coincidentally or not, 2005 was also the high-water mark for DVD sales.)

Consider that HDTV turned the idea of TV viewing upside down. Gone was analog TV, replaced by digital bits and bytes. Gone too were big, bulky cathode-ray tubes, replaced by matrices of tiny pixels actuated by LCD and plasma technology.

Good-bye, VHS tapes – DVDs were well on their way to killing off this format by the start of 2005. And of course we were no longer limited to just 480 lines of picture resolution, but could enjoy programs with 1280×720 and 1920×1080 pixels of picture detail…win widescreen, no less!

Think about it. TV was literally re-invented from 1998 to 2005. And in 2009, we pulled the plug completely and analog TV broadcasts, completing the switch. But that was 11 years after the process started.

For most viewers, 3D is still an expensive novelty

So…manufacturers want people to buy into 3D. Currently, there are a limited number of 3DTV sets for sale, and they’re not as cheap as 2D sets. And there’s not much 3D content available on Blu-ray to watch right now. You can count the number of 3D TV networks on the fingers of one hand.

And the glasses! Depending on which model 3DTV you watch, you may see ghost images. Or, the picture may get darker as you tilt your head. (You may even get a headache after a few minutes.) And the glasses are expensive, and you need a separate pair for every viewer.

Did I mention that most 3D glasses will not work with other brands of 3D TVs? Hey, you could make anyone’s HDTV set-top box work with anyone’s DTV set. Ditto DVD players and Blu-ray players, and set-top boxes. But not 3D glasses.

It also doesn’t help that we’re in a nasty recession. People are reluctant to spend money now, especially with close to 10% unemployment.  So 3DTV winds up being an exotic luxury for now.

I return to my main point, and that is the long adoption curve I anticipate for 3D. The price premium is one drawback, and the other is the fact that millions of U.S. homes just bought one or more new HDTVs within the past three years.

Depending on whose numbers you believe, we are at or around 50% penetration for HDTV, meaning 50% of all homes have at least one HDTV set. I can guarantee that more than half of those sets were purchased after Q3 of 2005. So, where’s the impetus to buy a new 3DTV?

The good thing about a long adoption curve: Within two years, all models of HDTV sets 50 inches and larger will have the capability to play back 3D programming. (They’ll all have network connections too, but that’s another story.) So it won’t matter which set you buy – you’ll have the 3D playback built-in.

The same thing will happen with Blu-ray players and set-top boxes. They’ll be able to process 3D content as easily as 2D content. So you won’t have to buy an expensive special model just to watch 3D Blu-ray discs.

How long a curve are we looking at? I’d say about five years. By then, broadband speeds will have picked up considerably and we’ll be able to access 3D content through Internet TV channels, as well as from optical disc and video-on-demand.

Content drives demand, and there just isn’t enough of it in 3D right now. By 2015, the situation will have changed dramatically and we’ll have 3D movies, games, and TV programs coming out the wazoo.

Until then, expect 3D to penetrate the TV market slowly, in fits and starts…just like HDTV did.

Memo to 3D TV manufacturers: First, you build the highway. Then, you build the cars!

The latest PR blurb from CEA headquarters shows that, in a survey taken of 250 sales associates in retail stores, consumer enthusiasm for 3D is strong, with 50% of customers reporting a positive response to 3D technologies, and only 2% reporting a negative response.

That’s not necessarily good news. Do the math, and you’ll see that 47% of customers had no feelings about 3D TV one way or the other, or didn’t respond. (Or were distracted by their teenagers repeatedly begging Mom and Dad for an iPhone or iPod Touch.)

The CEA report does go on to say that “…While nearly 70 percent of sales associates feel well trained to answer questions about 3D, there is still consumer confusion. According to the retail associates interviewed, roughly half of consumers had some confusion about the technology.” That pretty much covers the 47% who didn’t respond positively or negatively.

And now for the devil in the details! “…For most retail associates, 3D content is pivotal. Nearly 80 percent of the associates interviewed believe sales of 3D technologies will not be strong until more 3D content is available.  Moreover, some of the most frequently asked questions by consumers revolved around the availability of 3D content. “

World Cup in 3D…Been there, done that. What else ya got?

There’s the rub. 3D may look great in the store, but how much 3D World Cup coverage can you watch before nodding off? (Hey, did you catch Paraguay and Japan fighting to a 0-0 tie?) And there are only a couple of 3D Blu-ray discs out there that haven’t been exclusively linked up to a 3D TV bundle promotion.

DirecTV is taking some steps to solve the problem today, announcing the launch of its 24-hour 3D channel in conjunction with Panasonic at a New York City press event. That’s good news for DirecTV customers, but it’s not much help to cable or Dish Network subscribers who are currently limited to ESPN 3D.

If this seems like déjà vu all over again (apologies to Yogi Berra), it is. Remember the start of the digital TV transition in 1998, when exactly two DTV stations went on the air? (For trivia buffs, they were WRAL (CBS) in Raleigh, NC, and WFAA (ABC) in Dallas-Ft. Worth, TX.)

Set-top boxes cost about two grand. You needed component inputs on your TV that could accept the 1080i signal from the box (good luck with the 720p outputs), plus an antenna, and maybe a preamp, and a bunch of coax, and a compass to tell you where to aim the antenna.

Oh, and yes – you needed HDTV content. But there was very little of it back then, aside from some CBS prime-time programs and the ABC Saturday Night Movie. It wasn’t until four years later (2002) before most of the TV networks were carrying a majority of their evening programs and sports coverage in HD. Can 3D TV manufacturers afford to wait that long?

It’s encouraging that 70% of the sales associates interviewed by CEA felt competent enough to answer questions about 3D. But that’s not the problem, based on my experience last Sunday at Best Buy. Only two out of four 3D TV demos in the store were actually working, and one was located in the worst possible spot for a demo. The other had only one pair of working 3D glasses. How do you answer questions about 3D, when customers can’t even see a demonstration of it?

This is where a company like Sony has a leg up with their Sony Style company stores. They can ensure (and they’d better!) that potential customers get the best possible 3D demo, with a large screen LCD TV and comfortable seats positioned at the correct viewing distance. And they can put together a nice mix of live 3D (Sony is a World Cup sponsor) and clips from Sony Pictures 3D movies (think Cloudy with a Chance of Meatballs).

Samsung’s ‘experience’ store in the Time-Warner Center in New York City is also an excellent place to demo 3D. (Hmmm. Maybe Samsung should be thinking about opening their own company stores!) Alas, Panasonic has no such showcase and is at the mercy of Best Buy and Sears. And Mitsubishi (who has some of the most compelling 3D TV value propositions right now) has no 3D showcases at all. (Too bad they can’t just truck their June NYC line show around the country!)

Now, THIS is how ALL 3D demos should look. (Dream on…)

But all the demos in the world won’t do any good if there is nothing to watch in 3D. And for the vast majority of potential 3D TV customers, there just isn’t enough to watch in 3D right now, so the credit cards and checkbooks are staying in pockets and purses.

Hopefully, that problem will sort itself out by year’s end, when we should see a flurry of 3D BD releases, more coverage of sporting events, the launch of Discovery’s 3D channel, and maybe even some 3D streaming from Netflix. (That last possibility assumes Netflix can get over some significant technical hurdles, such as bandwidth.)

Hint to TV manufacturers, and to Fox Sports: S-U-P-E-R B-O-W-L I-N 3-D. (Think that was subtle enough?)

So, we’re back to 1998. Grab some shovels and picks, and let’s get started on those highways! (Maybe there are still some stimulus funds available?)