Posts Tagged ‘Sharp’

CES 2019 In the Rear View Mirror

I’m not sure when I first started attending CES, but it was back around the turn of the century. My interests then lay primarily in display technologies – televisions, monitors, projectors, and all the gear that interfaced them to things like DVD players, HDTV set-top boxes, and early gaming consoles.

It wasn’t unusual to see manufacturers try to out-do each other in the race for the biggest display or the most pixels. We were wowed by 102-inch plasma TVs (a product that never came to market), 105-inch LCD monitors, “HD” projectors with 1280×720 resolution, upscaling DVD players, line quadruplers, and all kinds of external video signal processors that were designed to clean up standard-definition video, S-video, and analog component video.

Flash forward to 2019, and those times feel like early colonial America. Plasma is gone. “HD” in a front projector means at least 1920×1080 resolution, with an increasing number of home theater models offering 4K resolution. DVD players are fossils now and Blu-ray players have evolved with the times to support Ultra HD resolution.

Not that it matters much. More and more consumers are choosing to stream video content, thanks for faster, more reliable Internet and WiFi connections. Codecs have improved by several generations. The H.264 AVC format was just clearing the drawing board in 2002. Today, we have HEVC H.265, Google’s VP9, and now an even more efficient codec that promises to cut bit rates for 4K content by 50%.

Analog TV interfaces are all gone. It’s either HDMI or DisplayPort, or a streaming connection through WiFi or a Cat 6 cable. Those expensive video processing chips have multiplied in power so many times and shrunk accordingly that they are commonplace in Ultra HDTVs. At CES 2019, new “AI” processors can analyze multiple vectors and aspects of a frame of video and scale, color-correct, gamma-correct, and clean up compression artifacts in a flash.

LG’s got 8K TV covered with both LCD and OLED models.

 

Samsung’s Wall modular LED TV made an appearance again at CES. This time, it measures 219 inches diagonally.

I saw several demos of standard-definition video scaled up to 4K and even 8K TVs and was impressed at just how well these advanced chips work. Unfortunately, there’s lot of potential for mischief with these processors, such as changing the frame rate, gamma, black levels, and even color tone automatically without you asking. That’s progress for ya!

About the only thing that hasn’t changed since the early 2000s is the size of the largest LCD panels. If memory serves, Sharp held the record for many years with that 105-inch beast. Both Samsung and LG eventually wheeled out even larger panels and the record (so far as I can remember) was 120 inches for a VA LCD monitor, shown a few years back by Vizio and also by Samsung. Thing is, none of those products really took off: Today, the largest LCD TV you can buy is Samsung’s new 85-inch 8K offering, with 98-inch models lurking in the wings from LG, Samsung, Sony, and others.

The biggest change I’ve seen in the past decade is how televisions and related products have been de-emphasized at the show. No surprise there – TV prices have collapsed to the point where you can pick up a very nice 55-inch Ultra HD model with HDR support for about $6 per diagonal inch. There are plenty of 65-inch models priced below $1,000 and some 70-inch UHDTVs have dropped as low as $1,200 on sale.

TCL’s XESS “Living Window” TV is supposed to appear as if it’s floating in mid-air.

 

This 65-inch Skyworth UHDTV uses two LCD panels to improve black levels and contrast.

Price drops have been dramatic for both LCD and OLED models. LG just announced special pricing for the next two weeks on 55-inch Ultra HD B8-series TVs ($1500) and 65-inch B8s ($2300). Vizio announced during CES that their 2019 M-series and P-series UHDTV sets will incorporate quantum dots for high dynamic range video, and you can be sure they’ll have aggressive pricing on all models.

Also, not surprisingly, there’s less profit in selling televisions these days, which is why most of the big exhibitors at CES have reduced the footprint in their booths for showing off TVs, allocating more space for everything from refrigerators and washers to smartphones, tablets, small appliances, laptops, and even automotive electronics. Secondarily, many of us analysts and journalists have expanded our coverage to include video encoders, decoders, and signal management systems, video streaming, cloud storage and asset management, and peripheral markets like transportation.

Without further ado, here are some of my highlights from the show.

Sony will offer XBR-Z9G Master-series 85-inch and 98-inch 8K LCD TVs with HDR, complementing their OLED TV lineup.

 

Hisense claims its Adonis 8K display uses micro LEDs for backlights, but they’re more likely “mini” LEDs.

“Yes Virginia, there are 8K televisions!” And CES was awash in them, from LG’s 88-inch OLED to Samsung’s 85-inch QLED 8K. (LG also had 75-inch LCD sets using their NanoCell color filter technology.) Sony showed 85-inch and 98-inch 8K model in their booth to complement their line of 4K OLED TVs. Sharp, which is planning to re-enter the television business in the near future, will offer 60-inch, 70-inch, and 80-inch 8K TVs. TCL, Hisense, Konka, Skyworth, and Changhong also unveiled 8K TV prototypes.

I counted over a dozen different models, including more than a few showing next-generation backlight technology based on “mini” LED arrays. (A few of the demos referred to “micro” LED backlight arrays, but that’s unlikely at this date due to manufacturing challenges.) The advantage of “mini” backlights is more and smaller areas of local dimming, improving contrast and high dynamic range response.

Sharp’s planned re-entry into the television business is intriguing, considering the company’s near-bankruptcy a few years ago and the subsequent purchase of 66% of the company by Hon Hai Precision Industries (Foxconn). Instead of borrowing more money from Japanese banks to stay afloat, Sharp now has Terry Ghou’s huge bankroll to plan its product line and marketing, not to mention a complete line-up of 8K televisions, the BC-60A 8K broadcast camera, an 8K non-linear editing system, and an 8K asset storage and retrieval system (cloud based, of course).

Sharp wants back in to the premium TV business and showed wide range of 8K products, including content streaming.

 

Stream TV networks showed an 8K desktop monitor and his 65-inch autostereo 8K TV. 3D isn’t quite dead yet!

“This will DEFINITELY be the year for 60 GHz wireless!” I’ve lost track of how many 60 GHz wireless video demos I’ve seen over the past decade from companies like Silicon Image and its successor Lattice Semiconductor, DVDO, Qualcomm, and Intel (not to mention the WiFi Alliance). Products come and go (remember the 15 different tri-band WiFi modems from 2016?), but the technology seems to be stuck in a rut.

Maybe 2019 will be different. Keyssa demonstrated near-field connectivity of everything from tablets to TVs and snap-on LED tiles using its KISS technology. The chips are about as big as a deer tick, but the principle is that of coupled energy over a maximum 10mm air gap to transport data in a half-duplex mode at up to 6 Gb/s per lane. To prove the weight-lifting capabilities of this tin titan, Keyssa also built a wireless backplane dock that uses 32 KISS channels to stream 8K video at 96 gigabits per second. (Yes, it IS that fast!)

Several floors up in The Westgate Hotel, Canadian fabless semiconductor company Peraso also has a few millimeter-wave tricks up its sleeve. In addition to 4K wireless USB links, Peraso also showed 60 GHz 802.11ad WiFi access points for high-speed in-room video streaming and super-fast data downloads. At this frequency, radio waves can’t penetrate solid objects, nor is it at all easy to intercept them. That combination provides very robust security, and I’m still puzzled why more manufacturers haven’t adopted the technology.

Did you know you can couple 60 GHz wireless 4K video signals over flexible plastic rods? Keyssa does.

 

This ready-to-buy 60 GHz wireless access point uses chipsets from Peraso.

On the show floor (near its ‘connected beer’ exhibit, I kid you not), Qualcomm had an intriguing demo of super-fast gaming using 60 GHz links from smartphones. There are six channels available in this band, each of which is a little over 2 GHz in size. With light compression, there is near zero latency for gamers. And with steerable antenna arrays, multiple players can work with different screens on the same channels and never interfere with each other.

“Interfaces will get faster. Believe me!” With 8K and HDR looming (not to mention high frame rate video), our display interfaces need to get a heckuva lot faster in a real hurry. Over in the HDMI pavilion, there was a demonstration of Samsung’s Q900R 85-inch 8K TV showing custom 8K video content through an HDMI 2.1 interface built by chip maker Invecas. Given that only Socionext is currently shipping v2.1 TX/RX sets, I had to grill the Invecas rep to verify that “no, you won’t find HDMI 2.1 on the Samsung set currently.” (It’s currently equipped with one HDMI 2.0 interface).

During its press conference on Tuesday, LG claimed that their 2019 8K TVs will “support HDMI 2.1.” Presumably, this means there is some sort of upgrade path for models released earlier in the year, inasmuch as there is still a lot of testing and compliance certification to be done before manufacturers can start rolling out version 2.1. Samsung, for their part, has an upgrade option on the 85-inch model.

Over in the DisplayPort booth, it was announced that DP 2.0 will begin rolling out later in the year. V2.0 raises the per-lane data rate from 8.1 Gb/s to an astounding 24 Gb/s for a total data rate across all four lanes of 96 Gb/s. (Subtract 20% for overhead bits to get the real rate). This is clearly optical fiber territory – I’m not aware of anyone transporting data at this speed over copper links. And while that may seem like a lot of horsepower, keep in mind that an 8K/60 signal with 10-bit RGB color will require about 85 Gb/s to travel.

Invecas demonstrated an 8K home theater, using HDMI 2.1 connections. It will be a while before you see v2.1 on any TVs, though.

 

DisplayPort 2.0 is coming! In the meantime, v1.4 can drive three monitors simultaneously – and with different 4K video on each.

“Taking displays to another level!” Skyworth showed a 65-inch 4K TV using a dual-panel LCD structure. One panel delivers the full-color HDR images while the second panel acts simply as a monochromatic light modulator. In effect, it’s another shutter, allowing the display to achieve OLED-like black levels and very high peak (specular) whites while maintaining a wide contrast ratio. Not a new trick – Panasonic showed a similar approach for a 31.5” HDR 4K monitor a couple of years ago – but this is the first time I’ve seen it in a consumer TV.

In the LG Display booth, among the curved and transparent OLEDs, I found LG’s In-Touch system. Unlike conventional touchscreen film overlays on displays, In-Touch places the touch sensors directly below the LCD glass surface. This results not only in a more sensitive touchscreen, but it’s also a lot more accurate as the gap between the surface and sensors is greatly reduced.

And it appears that the fascination with curved displays has gone the way of 3D. I spotted only one curved 65-inch Ultra HDTV, and that was in the TCL booth. Samsung won an award for its LG was more focused on its premium roll-up/down 4K OLED TVs, a concept first shown last year at CES by LG Display. These roll-up sets don’t have a price yet, but will be part of LG’s Signature OLED line.

Samsung’s 75-inch micro LED TV prototype might have been the only true “micro” shown at CES.

 

Lumens’ .57″ green micro LED display has Full HD resolution for near-to-eye displays. And it’s bright!

Samsung did show a 75-inch class micro LED TV prototype at their Sunday preview event, an interesting demo for a company that apparently wants to get out of the LCD manufacturing business and concentrate on purely emissive LED TVs and displays, going forward. Of all the demonstrations of micro LED, I have no doubt that Samsung’s prototype is the real thing. Keep in mind that we’re taking about tiny LED chips that measure less than 50 micrometers (µm), while “mini” LEDs are in the range of 100 µm to 200 µm.

Lumens demonstrated something a bit simpler but no less important: A .57” green (monochromatic) micro LED display, suitable for head-mounted displays. This device has Full HD (1920×1080) resolution and is capable of brightness levels in excess of 300 nits. Over in the Sands, Kopin showed its 2K OLED near-to-eye display, which is about the size of a quarter. And Vusix demonstrated its Blade AR glasses, which project a small color video image onto the lens surface that isn’t quite as detailed and contrasty a I expected.

I’ll close out this report with a mention of the next-generation video codec for compressing 4K and 8K video. Fraunhofer had a small exhibit that was easy to miss, detailing the Versatile Video Codec (VVC). VVC builds on the coding tree block and unit structure of HEVC H.265 and makes analysis and compression decisions on a more granular level. This codec requires a considerable increase in computing power, but the target of the Joint Video Experts Team (JVET) is to achieve a 50%  bitrate reduction for comparable image quality over H.265. Look for the final standard in 2020.

The Versatile Video Codec can stream 4K content at 2.2 Mb/s that looks as good as H.265 at 5 Mb/s.

 

Audi’s been using red OLEDs in their tailights for some time now. (You didn’t know?)

 

Roll-up TVs are here, thanks to LG. Now you see them, now you don’t!

 

 

 

 

 

ISE 2018 In the Rear View Mirror

I just returned from a week in Amsterdam in what is now the largest AV trade show in the world, Integrated Systems Europe. The organizers claim that 70,000 people attend this event and that number is certainly believable: The RAI exhibition center had to erect two additional temporary “bubble” halls to hold all of the manufacturers, and the foot traffic was crazy in the main halls.

If there was an overarching theme to the show, it had to be the migration of AV signal distribution to IT networks. Booth after booth featured exhibits of video encoders, demonstrations of compression and picture quality vs. latency, giant signs extolling the virtues of video and audio distributed over 1 Gb and 10 Gb networks, and plenty of “us vs. them” comparisons.

There are so many players in the AV-over-IT world that you need a scorecard to keep track of them. Of course, everyone has their own “special sauce” when it comes to sampling, compressing, and recovering video (audio is easy!), and those “us vs. them” demonstrations usually featured (a) a live video source, (b) that same video as processed through the manufacturer’s encoding system, and (c) that same video as processed through the competition’s video encoding system.

Crestron claims near-zero latency for their DM NVX codec, compared to SVSI…

 

…except that the SDVoE exhibit showed that DM NVX does have latency – at least, more than SDVoE’s Blue River system.

Latency was a big topic at the show. It’s defined as the time delay between a frame of source video and that same frame of video after recovery from a decoder and is typically measured in milliseconds. For some reason, the AV industry is obsessed with “near zero” latency in AV installations and I lost track of all the booths claiming their products had “little,” “near zero,” and “almost none.”

Crestron had a large exhibit in their booth, touting their DM NVX system for signal distribution and control over IT using 1 Gb network switches while maintaining image quality. To drive the point home, they had a side-by-side comparison of SVSI and HDBaseT transmission with DM NVX to show that it had the lowest latency. Time code was shown on all displays and visitors were encouraged to “take a picture with your phone” to confirm their claims.

At the back of another hall, the SDVoE Alliance had an exhibit saying, “Not so fast!” Their demo compared a video source to DM NVX and an SDVoE Blue River NT codec and appeared to show that the Crestron product had higher latency (and once again, visitors were encouraged to take a picture and confirm what they saw). The big difference? SDVoE promotes the use of 10 Gb switches instead of 1 Gb switches (a point I concur with) so even signals with 4K resolution can travel with light compression.

I’m not sure what codec Crestron is using, but the Blue River codec is adapted from VESA’s Display Stream Compression (DSC), an entropy-based compression scheme with extremely low latency that is well-suited to packing down 4K and even 8K signals.

Epson was mapping images onto a projector (right) that was projecting onto a large screen (left). Did you get all that?

 

Optoma is now in the LED display wall business.

Consider that HDMI version 2.0 is only fast enough to transport 2160p/60 with 8-bit RGB color and you can see the advantage of 1.5:1 and 2:1 compression to increase color bit depth – essential to distributing signals with high dynamic range and wide color gamuts, not to mention high frame rate video. (For those keeping score at home, a 2160p/60 signal with 10-bit RGB color requires a data rate of 21.39 Gb/s, so with a little over 2:1 compression, it will pass through a 10 Gb/s network switch.)

This looming battle between codecs and Valens’ HDBaseT format will only heat up as more manufacturers adopt ‘pure’ AV-over-IT solutions. HDBaseT is still limited to 328 feet of cable length and data rates of 10.2 Gb/s, although Aurora Multimedia claims their IPBaseT hybrid product can push HDBaseT speeds much higher and accommodate 4K signals with deeper color. Further confusing the issue is the TiCo (Tiny Codec) which is based on JPEG XS, a “mezzanine” codec that will permit lighter compression of video so that it can travel through a 10 Gb network.

Another trend was the explosive growth of LED signage. Hall 2 had so many Chinese LED manufacturers that I couldn’t keep track of the all. The “hot” technology nowadays is micro LED, or LED pixel elements with a pitch less than 1 millimeter. Consider that a 50-inch plasma TV from 1998 had a pixel resolution of 1280×768 or about 1.2mm, and we can now install a wall-sized LED display with a dot pitch approaching .8mm.

There’s no question that these products are having an impact on the projector industry. As I’ve mentioned in the past, every concert I’ve attended in the past 3 years has relied on large LED displays to show live video and graphics – none of them employed projectors, so far as I can remember. One consequence of this trend is that projector manufacturers including Barco, Christie, Panasonic, and Digital Projection chose to emphasize LED displays and walls in their booths (like covering their bets) alongside their flagship products. (Even Optoma did this!)

Absen had a humongous booth at ISE and is becoming a major player in LED signage in the U.S.

 

4K LCDs are here for digital signage and Leyard was promoting a full line of them.

In contrast, the challenge for Chinese LED display companies is that no one really knows anything about them, not to mention how reliable their products are. So now we’re seeing familiar names from the U.S. AV industry showing up in engineering, marketing, and sales positions for the likes of Leyard/Planar, Unilumen, Absen, and other brands, a strategy meant to bridge the familiarity gaps and increase sales.

Another area of interest is collaboration. Mersive’s Solstice had an exhibit that stressed the importance of analytics, gathering data on who was logged into a presentation sharing system and when. Kramer’s VIA product also has an analytics function and it looks like other companies are heading in that direction. DVDO, formerly owned by Silicon Image / Lattice, is independent again and has joined the collaboration space with their Tile product. This can stream and tile five independent sources of Full HD video, not to mention share screens and cast.

You wouldn’t think of “Sharp” and “broadcast video camera” in the same sentence – yet, here they are with exactly that.

 

Panasonic showed an 8K workspace, made up of two side-by-side 4K LCD monitors equipped with touchscreen overlays.

The 800-pound gorilla in this space is, of course, Barco’s ClickShare. There are three iterations of the product, with the top-of-the-line CSE 800 allowing 8 shared screens at the same time through dual 4K display outputs. Crestron had a demo of AirMedia that claimed higher bandwidth than Solstice (1.6 Mb/s), full network security, .05 seconds latency (there’s that latency thing again!), and enterprise management software.

There was even a minor controversy at ISE. Barco posted a press release stating that they had “instructed bailiffs to approach the booth of Kindermann and collect evidence of its Klick & Show wireless presentation system present at the show” to be used in patent infringement suits. Apparently, the same thing happened last year with Kanex Pro at ISE. What really happened was that nothing was taken from Kindermann’s booth, but the press release did create some discussion.

The continuing decrease in hardware costs are the real elephant in the room. Consider that it was possible to buy a 50-inch RCA 4K TV at Shop Rite the week before the Super Bowl, and you can clearly see just how quickly value is being sucked out of consumer and commercial AV gear. In addition to the “hang and bang” projector market getting hammered by ever-cheaper and larger LCD displays (which are moving quickly to 4K resolution exclusively), AV signal management equipment – switchers, distribution amplifiers, and extenders – is susceptible to this ‘dollar store’ trend as more and more brands come to market with hardware largely manufactured in Asia.

The AV-over-IT business is a clear example. Most IT products are sold through distribution and it’s likely that most AV products will follow that path in the near future. The core products for any AV-over-IT installation are encoders and decoders, and more than a few products I saw are being sourced from China. Indeed, more than one booth at ISE featured the same exact product in a different housing, the only differential being price and perhaps a few bells and whistles.

One thing is for certain. Many large companies who have ruled the AV roost for decades are finding themselves in an unfamiliar position these days, trying to keep up with the pack as the migration to AV-over-IT continues. We’ll see how the trend plays out at InfoComm in June…

Turn Back The Clock?

A recent story in the Nikkei Asian Review states that Hon Hai Precision Industries – the new parent company of Sharp Electronics – is considering building an LCD panel facility in the United States. The finished panels would likely be intended for televisions.

According to the story, Hon Hai is responding to President Trump’s call to bring back jobs to the United States. When Hon Hai investment partner SoftBank Group’s chairman Masayoshi Son met with Trump last month, he said that both companies would make “significant investments” to create new jobs in the U.S.

In a related story on the CDRinfo.com Web site, Hon Hai chairman Terry Gou was quoted as saying that he’d consider going ahead with such an investment if “the U.S. is willing to offer land at a cost of US $1 for building the panel plants.” Apparently Apple is also part of the discussion and mentioned as a joint investor.

Gou was also quoted in the CDRinfo story as saying that “…U.S. President Donald Trump should love to see a vertically integrated industry such as panel manufacturing grow and develop in the country.”

Coincidentally, Hon Hai and Sharp are getting ready to break ground on a Gen 10 LCD fab in Guangzhou, China at a cost of $8.69B. That plant is scheduled to open in the fall of 2018. People familiar with the project said the proposed U.S. LCD fab would be of the same size and generation.

While this is an intriguing story, there are caveats. First off; LCD factories are mostly automated – they have to be, considering the manufacturing precision involved – so there wouldn’t be all that many permanent jobs created once construction is completed. (The same thing applies to Intel’s proposed semiconductor fab in Arizona.)

Second, most of the permanent jobs will likely require college degrees in the sciences (physics, engineering, and chemistry), aside from basic factory functions, shipping, and facilities maintenance.

But the biggest obstacle to building the plant will be the finished cost of the panels. There’s a reason why the LCD panel industry (and with it, television manufacturing) is migrating to China: Manufacturing costs there are much lower because labor rates are lower. That, in turn, will make Sharp-branded televisions much more expensive than those coming from Korea and China.

Consumers have been conditioned to expect ever-lower TV prices with ever-larger screens. Consider that you can already buy a 55-inch “smart” Ultra HDTV for $500 now: How will a US-made UHDTV compete against that price?

Consider also that in the 4K TV world, Samsung has over a 30% market share and LG has another 15%. Conversely, Sharp’s current TV market share is less than 1% and its brand doesn’t have anywhere near the cache it once had. So Hon Hai would have to find other customers for its panels to avoid underutilization of plant capacity.

Matters are further complicated by the fact that Hisense currently controls the marketing rights for the name “Sharp” in the United States and has no intention of giving them up. That little dust-up is why Hon Hai cut off supplies of VA LCD panels to Hisense last fall, forcing them to look elsewhere for a supplier.

Of course, there’s been plenty of talk in Washington about slapping 20% tariffs on foreign-made goods. That cost would be passed along to customers, and don’t you think Samsung and LG will adjust their prices as needed to maintain their dominant market shares? The net result would be that Sharp-branded LCD TVs would still languish on store shelves while Samsung, LG, Sony, Hisense, and TCL continued to dominate the market.

The recent election was filled with jingoistic slogans like “Bring Back America.” Well, then – which one? The America of the mid-1980s where the television manufacturing business involved lots of workers on assembly lines, hand-wiring CRT televisions and installing them into cabinets?

Sorry, that ain’t gonna happen. The US TV industry was pretty well decimated by 1986 when Zenith finally threw in the towel on TV production stateside. (Zenith was later acquired by LG Electronics.) The Japanese had our number. Then, the Koreans pulled the rug out from Japan, starting in the late 1990s. And now it’s the Chinese TV manufacturer’s turn to run with the ball.

The widespread availability of inexpensive LCD panels from China is a big reason why you can now afford to buy a 65-inch 4K TV for less than $800, or a 4K HDR model for about a grand. For that matter, you can now pick up a 50-inch Full HD (1080p) LCD TV for less than $300, and 42-inch sets have dropped below $200.

Question: Do you really want to pay 30 – 40% more for a given TV just because it’s made on this side of the Pacific Ocean? I didn’t think so. More expensive TVs will prompt people to delay their TV upgrades for a longer time period, which is exactly what Hon Hai doesn’t want to happen, and can’t afford to have happen if they’ve sunk a few billion dollars into an LCD fab.

Time marches on..

You Don’t Need A Weatherman

Just when you think you’ve seen it all, you’re reminded of just how sharply the balance of power in consumer electronics manufacturing has shifted to China. In a New York Times story from February 2, Sharp Corporation – a Japanese colossus in everything from LCD displays to office products and personal gadgets – let it be known that they are seriously considering a sale to Hon Hai Precision Industries of Taiwan.

You may not recognize the name Hon Hai, but you may know one of their subsidiaries: Foxconn, the manufacturer of just about everything with an Apple logo on it (IPhones, iPads, MacBooks, Apple TV, etc.) And Hon Hai is no stranger to Sharp, having bought nearly 50% of the latter’s Gen 10 LCD fab capacity in Sakai, Japan a few years back.

Why, and how? Sharp did not fare well during the global recession. Sakai, the world’s largest LCD fab, opened in 2008 as the world economy was tanking, affecting demand for all things electronic – especially liquid-crystal displays. Because Hon Hai (er, Foxconn) uses VA-type glass in its products, chairman Terry Gou approached the company with a deal it couldn’t refuse – except that Sharp got back just 20 cents on the dollar for its $4B investment in Sakai.

Several years of brutal red ink for Sharp brought the company to where it is today. Having borrowed hundreds of millions of dollars from Japanese banks to stay afloat as its worldwide TV business evaporated (and having sold small minority shares to Qualcomm and Samsung along the way to raise additional cash), Sharp’s day of reckoning has arrived.

Those were the days, my friend...we thought they'd never end...

Those were the days, my friend…we thought they’d never end…

The company, which ten years ago had a 21% worldwide market share in LCD TV shipments, sold its North American TV business to Hisense last year, along with an assembly plant in Mexico. The Sharp name will still be found on LCD TVs made by Hisense in China and southeast Asia, but largely as a bargain brand.

Not surprisingly, Japanese banks are reluctant to throw more good money after bad. According to the story, Sharp has seen $10B in losses over the past five years, reporting a net loss of $200M for the most recent quarter. There is a home-grown suitor – the Innovation Network Corporation of Japan (INCJ), a government-backed organization that is trying to keep some semblance of display R&D and manufacturing in Japan.

Trouble is; Hon Hai’s offer of $5B is twice as much as INCJ is willing to put on the table. INCJ, though, has said they will push to line up more financing from Japanese banks. But given the staggering losses incurred by Sharp, Panasonic, and Sony a few years ago, combined with Toshiba’s “cooked books” and exit from the television market and similar departures by Mitsubishi and Hitachi, means the old ways of doing business in Tokyo are probably over for good.

And things aren’t all rosy for Hon Hai, either. Although they are a strong player in consumer electronics – perhaps the dominant player in manufacturing – their profit margins have been shrinking in recent years. The company has branched into electric cars and robotics to diversify, but acquiring Sharp could prove to be a bit too much to swallow.

This is the next

This is the next “gold rush” in display applications.

Gou would love to have that Gen 10 plant running in China, and if he’s as savvy as I suspect, he can already see the enormous market opening up for transportation displays – cars, buses, trains, planes, ships, trucks, you name it – around the world. These displays are small to mid-size, resulting in more lower-cost cuts from larger motherglass and higher yields (and probably higher sales numbers than TVs and computer monitors).

This trend became obvious a few years ago at CES and this year, it went off the charts. Consider the market for automobiles alone – virtual dashboards, center consoles, GPs, rear-seat TVs – and you can see the potential to make billions of dollars. But you’ve gotta have enough reasonably-priced “glass” to do it.

Sharp’s CEO Kozo Takahashi said the company would take until the beginning of March to make its decision. Should the board opt to take Gou’s offer, that decision could turn out to be a tipping point for other Japanese manufacturers who are struggling to see profits in display-related manufacturing and sales.

In any case, this should convince you that the landscape for consumer electronics really is changing, and changing in a BIG way. You’ll see increasing numbers of TCL and Hisense TVs in big box stores this year, competing with the “Big 3” – Samsung, LG, and Sony. You’ll also see more Chinese-branded mobile phones from carriers, along with personal electronics like smart watches.

Like Bob Dylan sang so many years ago, “You don’t need a weatherman to know which way the wind blows…”

4K, Collapsing Prices, and the Declining Importance of Hardware

As I write this, the 2015 season of the National Football League is about to get underway, with last year’s Super Bowl champion New England Patriots taking on the Pittsburgh Steelers. If you’re not a football fan, why should you care?

Simple: Football, more than any other sport or event, drives the sale of televisions. And the TV business is in a major funk right now.

According to IHS’ latest survey of the global television market, worldwide shipments of TVs fell an astounding 8 percent Y-Y during the second quarter of 2015. Even though LCD TVs now account for almost 99% of all TV shipments, “…LCD TV sales have not made up for the lost volume of cathode-ray tube (CRT) and plasma televisions, which have largely left the marketplace.”

The one bright spot? 4K. The IHS report states, “4K TV was a bright spot in the global TV market, with unit shipments growing 197 percent year over year in Q2 2015, to reach 6.2 million units. The growth in 4K TVs is the direct result of increased price erosion and more affordable tiers of 4K models becoming available.”

I’ve written on numerous occasions that we’re on the cusp of an industry switchover from 1080p resolution to Ultra HD (3840×2160) for precisely this reason, plus the fact that it’s becoming increasingly difficult to make any money on the manufacturing and sales of 1080p-resolution LCD panels. That’s part of the reason that Sharp – once the premier brand of LCD televisions – finally threw in the towel and exited the North American television business, selling their Mexican factory and “Sharp” brand to Hisense.

Need proof? Check out the most recent HH Gregg and Best Buy circulars. You can now buy a 48-inch Haier 1080p LCD TV for $298 or a 60-inch LG 1080p smart TV for $898. Want Ultra HD resolution instead? Samsung’s got a curved 55-inch smart model for $1198, and a 60-inch smart set for $1498.

Samsung has slashed the prices on its new S-line of HDR Ultra HDTVs by as much as 20%.

Samsung has slashed the prices on its new S-line of HDR Ultra HDTVs by as much as 20%.

But here’s the kicker: Samsung’s HDR Ultra HDTVs (S-UHD) are almost the same price. A 50-inch model (UN50JS7000) is tagged at $1098 by HH Gregg, while the 55-inch version is $1298. Too expensive? Sharp’s got a 43-inch Ultra HD offering for $598, a 50-inch set for $748, and a 55-inch version for $848. (Not to be left out, LG has cut the price on their 55-inch smart Ultra HDTV to $998, and they’ve also got a 49-inch UHD set for $798.)

Now, step back from that mass of numbers, and think about this: Those are insanely low prices for Ultra HDTVs, which were tagged around $15 – $20K when they first came to these shores in 2012. I know of several friends and acquaintances that had to replace older TVs recently, and every one of them bought an Ultra HD set because of these falling prices.

If overall sales of TVs are falling but 4K TV sales are increasing, it doesn’t take a weatherman to see which way the wind is blowing: 4K and Ultra HD are rapidly taking over the TV marketplace for sets larger than 42 inches. This is happening so quickly that by the end of next year, ALL TVs larger than 50 inches will be Ultra HD models.

There’s a bigger message here. The money isn’t in hardware anymore – it’s moving to software. I find it hard to believe that I would spend more in a year for cable TV and Internet service than the cost of an Ultra HDTV, but that’s exactly what’s happening. Content is king, and who cares about the hardware?

So, why are TV sales in decline? It could be for a very simple reason, and that is the average household has a large-enough TV with enough bells and whistles that they see no reason to upgrade. If you already own a 55-inch or 60-inch 1080p set with “smart” functions ( and the all-important Netflix streaming), then the speed of your Internet connection is much more important than adding another 5 inches in screen size or quadrupling your screen resolution.

There’s a corollary in the world of tablets, where sales and shipments are also slowing down much faster than analysts predicted. There are any number of reasons why, but the two most likely culprits are the shift in preferences for larger smartphone screens (“phablets”) and the fact that people just hang onto tablets longer (at least, until their batteries die), often passing them down to children or off to relatives when a new model is purchased.

This shift to 4K and Ultra HD resolution is also impacting the commercial AV industry, which is heading for some serious interfacing issues. More and more of the large displays that will be installed will have Ultra HD resolution. And that will create a major headache for integrators, as the predominant interface for pro AV is still HDMI 1.4, even though version 2.0 was announced two years ago.

None of this is good news for the projector manufacturers, who are struggling to defend their turf from the large, cheap LCD displays. Unlike panel manufacturers, projector brands are moving slowly to adopt 4K resolution, which isn’t surprising because of the cost involved to tool up and manufacture microdisplays with 4K resolution and the much smaller market for projectors.

As for the naysayers who still think 4K is a fad, I would just advise them to wake up and smell the coffee. The world of consumer electronics absolutely drives the world of commercial AV – what’s happening over there is going to happen here, and that means you as an integrator will be installing more and more displays with UHD resolution; from desktop monitors and TVs to single-panel and tiled wall-mounted displays.

Count on it!