Posts Tagged ‘Sony’
CES 2015 In The Rearview Mirror
- Published on Monday, 12 January 2015 16:12
- Pete Putman
- 0 Comments
After all the PR hype and anticipation, the 2015 International CES has come and gone, leaving me to edit over 1500 photos and a bunch of videos and sift through stacks of press releases to see what was really significant about the show…and what was just fluff.
Before I drill down to make my top picks, I should point out some trends that have been building for a few years. We all know that the majority of our electronic gadgets (phones, tablets, home alarm systems, televisions, computers, cordless phones, and so on) are manufactured in China and Southeast Asia.
Still, the expanding CES footprint of Chinese brands (Haier, TCL, Hisense, Changhong, Konka, Skyworth) takes some getting used to. So does the shrinking footprint of former Japanese powerhouses like Sony, Sharp, and Toshiba. There is a profound shift in power happening in the CE world as the center of gravity moves farther away from Tokyo and Osaka past Seoul to Shenzen and Shanghai.
Another unmistakable trend is the decline in prices for a wide range of CE products. “Connected health” was a big deal at least year’s show, but is there really any news to be found in $60 Fitbits? Or $149 home security systems? Or $125 32-inch televisions?
Speaking of televisions, they are becoming less important in the overall scheme of things with each passing year. 4K Ultra HD was all the rage last year – this year, everyone had 4K televisions, and many models were equipped with quantum dot backlights for high dynamic range. Of course, there was no shortage of curved televisions in all sizes.
The facts are these: Changhong and TCL can make a large, curved 4K LCD TV with high dynamic range just as easily as Sharp, Samsung, and Panasonic. In some cases, the LCD panels used in these TVs are all coming from the same factory.
Samsung made a big splash this year with their S UHD television line, but they’re using quantum dots just like anyone else. LG showed both quantum dots and their new M+ technology that adds white pixels to an LCD matrix to boost brightness. TCL is selling QD-equipped TVs in China and expects to launch them on these shores this year.
Perhaps surprisingly, LG decided to make a big push for OLED technology, unveiling five new Ultra HD models at the show. While the Chinese also showed OLEDs (as did Panasonic), LG appears to be “all in” with their white OLED technology, claiming manufacturing yields as high as 70%. Well, someone’s got to pick up the torch that plasma dropped in 2013.
For many of these manufacturers, appliances and white goods are taking on a more important role in contributing to the bottom line. The margins are better on high-end refrigerators and washer-dryer sets for the likes of Samsung and LG, even though consumers don’t turn them over as often as televisions. For Panasonic, beauty products are an important income stream.
Cameras and camcorders are still holding their own against mobile phones, surprisingly. I entered the CES arena equipped with both a new Samsung Galaxy 5 phone and a Panasonic Lumix ZS40 camera. While the Galaxy 5 does take some great pictures under ideal conditions, it was no match for the 30:1 optical zoom lens (Leica glass) on the Lumix – the latter allowed me to shoot under, around, and over people to get the photos I needed.
Speaking of mobile phones and tablets, there wasn’t much news to be had at the show. LG showed its updated LG G-Flex 2 and Samsung had a crowd around its Galaxy family of phones and tablets, but there just wasn’t the “BYOD buzz” we’ve seen in previous years. The 5” to 5.5” screen size seems to be a sweet spot for phones now – 6-inch models were scarce in Vegas.
Connecting all of this stuff together made for a more compelling story from my perspective, especially as far as wireless technology goes. I saw more demos of wireless video streaming, wireless appliance control, wireless security systems, and wireless display connectivity at CES than at previous shows.
The 802.11ac channel bonding protocol is becoming increasingly important for making this stuff work in the 5 GHz band. And the wide-open spaces at 60 GHz are starting to attract everyone’s attention – having 2 GHz channels to play with is a lot more appealing for making high bitrate connections than fighting the congestion at 2.4 and 5 GHz.
Display interfaces are getting fast – a lot faster – and relying on compression for the first time. And now we’re starting to see the boundaries blur between small, high-performance mobile display interfaces and full-sized versions, which leads me to wonder why we need so many versions of HDMI and DisplayPort in the first place.
I’d be remiss if I didn’t mention the growing number of automobile manufacturers who set up shop in the North Hall every year. It reminds me of the New York Auto Show, with the likes of Hyundai, VW, Ford, Fiat Chrysler, and Audi showing off their latest high-tech “connected” automobiles that can do everything from mirror your smartphone’s display to recognize speech commands, navigate flawlessly, and even drive themselves.
And there were plenty of alternatives to gasoline-powered engines to seen, from BMW’s i3 electric car to Toshiba’s Mirai hydrogen fuel cell vehicle. All equipped with Bluetooth, 802.11, Sirius, and in some cases, user-customizable dashboard displays using flexible displays (important to survive vibration and G-forces).
Quite a bit to take in over three and a half days! What follows is my list (in no particular order) of significant products and trends I spotted in Vegas. Let’s see if they hold up as the year progresses:
High Dynamic Range – as usual, a hot new technology makes its appearance at the show and quickly becomes a buzzword. HDR Ultra HDTVs were shown by numerous manufacturers at CES; none more prominently as Samsung, who made HDR the centerpiece of their Monday press conference with their S UHD line. Virtually all of these TVs use quantum dot technology to boost image brightness and color saturation, and only one (LG) had an alternative path to HDR with M+ technology.
HDR is a key part of the transition to next-generation television. So are wider color spaces, high frame rates, and increasing resolution. Looks like everyone’s getting into the game, including the Chinese. Interestingly, I saw only one demo of Dolby’s HDR technology in the TCL booth (Vizio also has it), so it appears many homegrown solutions are in the works for HDR displays.
OLEDS Are Back – at least as far as LG is concerned. Seven new Ultra HD OLED TVs were rolled out at CES with sizes ranging from 55 inches to 77 inches, and one of them can flex back and forth from flat to curved surface mode. A partnership with Harman-Kardon should ensure better audio quality than you hear from typical super-thin televisions. (There were even two models featuring bases made from Swarovski crystal!)
With the demise of plasma, videophiles are still looking for displays that can give them the magic combination of deep blacks, saturated colors, and wide viewing angles. Right now, OLEDs are the only game in town, but they’ve proven to be tricky to manufacture with acceptable yields. LG Display seems to have overcome that barrier with these models (which use IGZO TFTs for pixel switching, by the way) and it will be interesting to see the uptake as 2015 winds on.
Super MHL Is Here: The battle for fastest display interface shifts back and forth between Silicon Image and VESA. DisplayPort fired the first salvo with their introduction of version 1.3, raising the maximum data rate to 32 Gb/s and introducing Display Stream compression for the first time. Now, the MHL Consortium has fired back with Super MHL. MHL stands for Mobile High-definition Link, and in its first iteration, allowed transport of 1080p/60 video over the 5-pin micro USB connector found on smartphones and tablets.
But Super MHL is different – it is a full-sized connector with 32 pins and matches the data rate of DP 1.3. The CES demo showed a Samsung 8K display being driven through Super MHL. How would anyone fit this on a mobile device? Does it replace HDMI 2.0? (It’s a LOT faster and uses DS compression, too.) So many questions to be answered…
Talk To Me: Conexant showed a demo of voice control for TV set-top boxes (change channels, bring up program guide, set DVR recordings) that was leap years ahead of their demo from 2013. This system works exceptionally well in noisy environments and can be used to control other devices, such as room lighting, thermostats, and security systems.
Conexant is looking to sell their technology as a system on chip (SoC) to a wide cross section of manufacturers. The trick had been reliable speech recognition in all kinds of high and low noise environments, something that doomed Samsung’s voice control TVs back in 2012. It appears they’ve finally pulled it off, but the focus has shifted away from TVs to set-top boxes this time around.
I’ll Be Watching You: The EyeTribe of Denmark showed an amazing eye tracking and control system at ShowStoppers that can operate tablets and phones and costs all of $99. Yep, you read that right! While Tobii’s impressive demos have focused on laptops and gaming systems, EyeTribe has gone after potentially the biggest market for eye tracking. How many times have you wished you could operate your mobile phone while your hands were full?
Faster Video For All: Giraffic had an intriguing demo of optimizing and speeding up video streaming rates over conventional TCP/IP networks. And it had nothing to do with adaptive bitrate streaming, using H.265 encoding, or AVB protocols. What Giraffic is doing is changing the nature and frequency of HTTP requests. This is the best way I can explain it: Imagine you just sat down with a big piece of chocolate cake and want to eat it as quickly as possible. If you take big bites, you’ll be chewing for a while and some pieces may get stuck in your throat.
But if you start with very small bites (like crumbs) and keep shoveling them in quickly, you’ll finish the cake just as fast – or perhaps faster – than the conventional way of eating. And that’s what Giraffic does – it keeps nibbling at the video stream to ensure continuous delivery, even with 4K content. The company claims they can achieve streaming throughput 200% to 300% faster than conventional video streaming, with no freeze-ups and annoying “buffering” warnings.
4K Blu-ray: Okay, we’ve been waiting for this for some time now. And 4K video streaming has already begun at Netflix and Amazon. But Ultra HD BD is finally out of the gate, although you won’t see it until the fourth quarter of this year. Streaming rates will be on the high side of 100 Mb/s with single and dual-layer discs available. (And yes, high dynamic range will be a part of the equation!) Panasonic showed their prototype of an Ultra HD Blu-ray player at the show. The question is; with all the enhancements coming to streaming, does optical disc matter anymore? Time will tell…
Circular LCD Displays: This was a breakout year for oddball sizes of LCDs, particularly in the Sharp booth where automotive displays were shown. (LG Display also exhibited circular and curved LCD displays.) Given the drop in TV prices and Sharp’s ever-dwindling market share in TVs, the market for automotive and transportation displays may be a better bet, long-term. Especially given the company’s leadership in implementing IGZO TFTs, which are important for brighter displays with lower power consumption and higher pixel density.
USB Type-C Connectors: VESA had an excellent demo of this game-changing connector, which has a symmetrical design (no need to worry about which way you’ve plugged it in) and can multiplex DisplayPort 1.3 video with high-speed data. USB 3.1 Type-C is seen as the next generation of USB connectors for mobile and portable devices, and by itself, it can move serial data at 10 Gb/s.
SiBEAM Snap Wireless Connectivity: Silicon Image has revived the SiBEAM name (they bought the company in 2011) and implemented their 60 GHz wireless display connectivity into a close-proximity variant. You simply bring two Snap-equipped devices together (like a smartphone or tablet and a matching cradle), and voila – you’ve established a full bandwidth data and display connection that can run up to 12 Gb/s. Plus, the connector can be used for wireless charging.
SI is showing integrated Snap transmitter and receiver chips that would replace USB 2.0 or 3.0 connections. Clearly, they are also targeting USB interfaces that support DisplayPort 1.3 (see USB 3.1 Type-C) and trying to move away from physical display connections. (This was one argument against using MHL to connect to televisions.) But if they’re successful, what happens to MHL? And now that Super MHL has been shown, what happens to conventional HDMI? Stay tuned..
Super-wide, high resolution desktop monitors: Seems like everybody had one of these at the show. HP, Dell, LG Display, Samsung, and others showed 27-inch widescreen displays with “5K” resolution (5120×2880 pixels). These monitors also support wider color gamuts and use 10-bit panels (a necessity, given all the 10-bit RGB images they’ll be asked to display). What’s surprising is how inexpensive these monitors are – HP’s Z27Q version will be available in March for just $1300.
Toshiba Glass: The jury’s still out on whether Google Glass is a hit or a bust (I’m leaning toward the latter). But Toshiba, who recently retrenched their television operations to Japan, is all-in with a line of enhanced glasses that employ a tiny projection module to show images on the lens surface. This has been tried before – Epson’s Moverio VR glasses have tiny QHD LCD panels embedded in them – and it remains to be seen if the public will buy into the idea. They do look stylish, though. (And there’s even a pair of safety goggles in the line.)
I’ll close out this report with a few passing thoughts. First, it’s impossible to miss the trends of mass-produced, cheap consumer electronics that are starting to turn CES into the old Comdex show. (And we all know what happened to that show!) Next, there is hardly any new technology debuting at the show that multiple manufacturers have in short order (and that includes the Chinese).
Whereas voice recognition was big a few years ago, gesture control took its place the past couple of years. But now that Omek (bought by Intel) and PrimeSense (bought by Apple) are absent from the scene, voice recognition has come back. My new Galaxy 5 phone has Samsung voice on it and it works reasonably well. However, it appears that consumers just haven’t jumped on the gesture recognition bandwagon yet.
Remember 3D? I almost got all the way through this report without mentioning it. A few companies still showed it, such as LG, Toshiba, HP, Hisense, Changhong, Ultra D (digital signage), Panasonic, and some gaming companies. Likewise, Google TV was gone this year, replaced by Android TV in such places as the Sony booth. Aside from program guide searches, I’m not convinced that the average TV viewer needs a Google search engine or Android OS on their TV. But I could be wrong.
Remember drones? I almost managed to skip them as well. There were so many at the show, ranging from behemoths that idled in place overhead while we visited tables at Digital Experience to pocket-sized models with built-in cameras that could zip unobtrusively over a crowd under the control of your smartphone. (I’m waiting for the first pocket-sized EMP generators to appear next year – like electronic bug-zappers.)
Finally, after a day full of press conferences during which there was only about 30 minutes of actual, usable news, I’d like to see a temporary moratorium placed on the words “innovation,” “big data,” “stunning,” “cloud,” “ultra” anything, and in the Chinese booths, “happiness.”
The only thing stunning about Vegas is how expensive cab rides have become. True happiness can only be found at Big Daddy’s Barbecue outside the Central Hall (dee-lish!). “Big Data” should be the name of a blues band, or at least the harmonica player. (Maybe Big Data and The Cloud?)
And I’m sorry, but a floor-mounted pet camera and toothbrushes that sync up to video games are not “innovation.” Cute, yes, but no innovative. (Although the self-powered skateboard I saw that can run up to 16 miles might fall into that category…)
4K & UHDTV: Once More Unto The Breach, Dear Friends…
- Published on Friday, 08 August 2014 11:40
- Pete Putman
- 0 Comments
Yesterday, TWICE reported that Samsung, Sony, and LG will partner with Best Buy on a 13-week consumer awareness campaign to increase interest in UHDTV and ultimately drive sales of 4K TVs.
The campaign starts tomorrow and is named “Believing Begins Here.” The Consumer Electronics Association had a part in developing the campaign, which will feature in-store demonstrations of UHDTV at 50 Best Buy locations in 11 major markets, including Atlanta, Boston, Chicago, Dallas, Houston, Los Angeles, Miami, Minneapolis, New York, Philadelphia and Washington D.C.
The timing of this campaign is no coincidence. National Football League pre-season games have already started, and the first NCAA college football games are scheduled for August 28. And as we all know, nothing sells big-screen TVs like football!
The demonstrations will take place between 11 AM and 3 PM each Saturday for the duration of the campaign. According to the TWICE story, these three major TV brands (and hopefully others to be added later) “…have chosen the last remaining big-box CE specialty chain as their showcase.” (I’m sure HH Gregg and Frye’s would dispute that last statement!)
Does this bring back memories of the stumbling, awkward effort to promote 3D TV five years ago? It should, except there’s a difference this time around. For one thing, there aren’t any eyewear issues, because there’s no eyewear. Assuming BB does a good job with 4K content selection, anyone who happens to wander by the demo can easily and quickly check it out.
For another, there’s aren’t any “exclusive” 3D Blu-ray deals tied to specific manufacturers and TVs, a strategy that amounted to shooting one’s self in the foot back then. Throw in the battle between passive and active 3D, the eye disorders and vision issues almost a quarter of the population experiences, and a paucity of interesting 3D content readily available to viewers, and the obituary for 3D TV was quickly written.
This time around, Best Buy has decided to emphasize 2K/4K upconversion as a “future-proof” advantage of 4K TVs and will have adequate demos of 2K-to-4K program material to make their point. And to attract potential customers, the usual manufacturer promotions and sweepstakes/drawings will be conducted. Prizes include a 55-inch Sony, Samsung, or LG UHDTV with installation and Geek Squad service plan included. (By the way, a 55-inch Samsung 4K TV can be taken out of the box and up and running in about 5 minutes, based on my experiences at InfoComm during my 4K / UHDTV class.)
The television industry clearly has a lot more at stake in 2014 than it did in 2009. TV shipments have declined for two years in a row, and TV prices are collapsing with each quarter. (You can easily buy 60-inch LCD sets for less than $1,000 now, and LG has already dropped a 55-inch 4K “smart” model to less than $2,000.)
For some manufacturers like Panasonic, the TV business has been de-emphasized in favor of commercial electronics products and even beauty aids and appliances. (Panasonic now sources a lot of its LCD TV glass on the wholesale market from Taiwan and China.) For others like Mitsubishi, the business of manufacturing and selling TV is “history” as their profits slowly but inexorably evaporated to nothing.
One fact that Best Buy and its partners can’t really explain to consumers is the changing dynamics of the LCD panel and television components supply chain. Thanks to an aggressive push by Chinese manufacturers into the television business and an emphasis on 4K, we will soon see ALL TVs larger than 55 inches move exclusively to 4K glass, just as we saw the migration from 720p/768p glass to 1080p about 6-7 years ago.
The good news is; 2K-to-4K upscaling is comparatively easy, as my colleague Ken Werner has pointed out in a previous Display Daily. Some manufacturers are even building upscaling chips into HDMI interfaces and cables! So the Best Buy demos should be effective if they start with strong 2K content.
But there are always unanswered questions. Best Buy now sells Vizio TVs, and according to Vizio’s timetable, they will have a full range of heavily discounted UHDTVs available this fall, starting at $999 for a 50-inch TV and going all the way to $2,999 for a 75-inch set. In the key sizes of 55 and 65 inches, the prices will be $1,299 and $2,199, respectively. How does that price war help the Big 3? And why should Vizio have anything to do with this campaign when they can simply sit on the sidelines for a couple of months and then swoop in and capture sales based on their brand recognition?
More devil in the details: We still don’t have a 4K Blu-ray standard, and every month it is delayed lets more wind out of the BD sails. According to a recent Home Media story, consumer spending on streaming, downloads, and optical discs was flat through the first six months of this year, to the tune of $8.6B in the U.S.
The “details” show us that digital spending (downloads and streaming of movies and TV shows) increased by 17% ($3.6B) over the same time period in 2013. Meanwhile, spending on optical discs (DVD and Blu-ray) continues to drop, falling 8% ($3.3B) in the Y-Y comparison. Additionally, rentals of optical discs dropped 14% ($1.7B) compared to the first six months of 2013. Brick and mortar store rentals took an enormous hit of 33%.
Breaking out the Blu-ray category, the story says that Blu-ray disc sales were up by 10% during Q2 ’14, with new theatrical releases up 18% in the same time period. But that’s not enough to offset the overall decline in interest by consumers to buy or rent optical discs. (No numbers were provided for Blu-ray sales revenues.)
Will 4K suffer the same fate as 3D? Not a chance. As I just pointed out, many of our big screen TVs will employ 4K panels exclusively in the not-too-distant future. The infrastructure for 4K streaming is being built and the sales and rental numbers show consumers increasingly prefer that delivery format to accumulating a pile of discs.
I plan to check out the 4K demos myself in “secret shopper” mode and will have a report in a future DD.
Of Phablets and 4K
- Published on Friday, 30 May 2014 08:52
- Pete Putman
- 0 Comments
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.)
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…
A Tale Of Two Companies, Part II: The Best-Laid Plans…
- Published on Friday, 16 May 2014 13:22
- Pete Putman
- 0 Comments
In a recent post, I talked about Panasonic’s impressive financial turnaround from its last fiscal year, booking a nice profit after doing some soul-searching and consequent house-cleaning of underperforming business units. And I contrasted Panasonic’s performance with the struggles of Sony, who continues to struggle with red ink. Let’s take a few moments to revisit both brands.
Coincidentally, Panasonic held a couple of press days this week in New York City to talk about its 2014 TV lineup. I attended the Thursday session and can say that it was much more low-key than previous Panasonic TV events.
For 2014, the emphasis was on two things – 4K, and cloud connectivity. Panasonic introduced a new concept, LifeScreen, which is yet another search engine combined with a clever graphical user interface. You pre-set your preferences, and your Panasonic TV searches for content to match them.
And how, exactly, does the TV know it’s you? Thanks to a pop-up camera and face recognition software, the TV comes to life when you stand or sit in front of it and loads up your programs choices. A new remote control provides both swipe control and voice recognition (shades of Samsung 2011!), and seems to work reliably.
Panasonic’s cloud structure isn’t much different than other manufacturers. You can download photos and video and share them with connected tablets and phones in your house. And you can upload your own photos and videos to the same online storage.
Now, to the nitty-gritty. As expected, the 2014 TV lineup is 100% LCD. What’s unexpected, but ultimately not surprising, is that you’ll find a mix of IPS and PVA LCD panels in these new TVs, meaning that Panasonic (like everyone else) is shopping for the best price and performance combination in LCD panels for their new TVs.
Given the cutthroat pricing in the TV market, this isn’t surprising and in fact is a smart strategy: There’s plenty of good LCD glass coming out of Korean, Taiwanese, and Chinese fabs, so why bother with the costs of making it yourself?
Panasonic’s value-add for these TVs is to improve the spectral response of the white LEDs used in these new sets, and it’s impressive. They’re claiming 98% coverage of the minimum DCI color space and have improved the rendering of yellow.
Side-by-side demos with last year’s award-winning ZT60 plasma TV showed the difference dramatically. Aside from the usual issues with PVA and IPS LCD panels, the images had excellent contrast, great color saturation, and decent black levels – and you can clearly see why plasma has fallen by the wayside.
There will be six series of models in the 2014 TV line-up, starting with the entry-level A400 and moving all the way up to the new 55-inch and 65-inch Ultra HD AX800-series TVs. The new remote and camera system come with three of these lines, and some models now include a sound bar (smart move!) in the box.
HDMI 2.0 and HEVC decoding are standard on the AX800, which is interesting considering how few Broadcom HEVC decoder chips have been deployed by TV manufacturers to date. And you can operate the TV from your iPhone or iPad (or Android device), even to the point of doing a full color and grayscale calibration, thanks to a new app.
So Panasonic remains a player in the TV game, even though the company’s worldwide market share fell out of the top five in 2013. Panasonic’s return to corporate profitability will take a lot of pressure off the TV division, which has relocated to San Diego from New Jersey.
In contrast, Panasonic’s neighbor down the street in San Diego – Sony – continues to struggle with red ink. The company released its final numbers for fiscal year 2013 last Thursday, and things still don’t look good, even though the picture is lightening up a bit.
For 2013, Sony booked a net loss of -¥125B (about $1.23B USD) with operating income of ¥26.5B (about $265M USD). There were a couple of operating divisions that continue to drag down profit, most notably Sony’s discontinued PC business unit, battery manufacturing, and disc manufacturing (DVD, Blu-ray) outside Japan and the U.S.
Sony’s long-struggling TV operations are reported as part of the company’s Home Entertainment and Sound business unit, which recorded a loss of -$248M for FY 2013. That’s actually a 70% reduction from FY 2012, which is a silver lining. Overall, the TV division saw its sales increase 30% Y-Y, which is more good news.
Another bright spot for Sony is its Imaging Products and Solutions (IP&S) division, which booked $256M in operating income. That’s not enough, however, to offset the -$729M operating loss from PC operations and the -$78M loss from the Game division. And an impairment charge of -$250M was assigned to the disc manufacturing business, adding more red ink.
Getting rid of the unprofitable PC business will definitely help next year’s results. (Apparently, so will the sale of Sony’s New York City headquarters on Madison Avenue, which netted almost $700M, according to the company’s financial statement.) The operating loss reported for the Game division (-$78M) was a surprise, but Sony attributed it to costs involved in launching the PlayStation 4 console and a $60M write-off of PC game software titles.
There’s no question that Sony has quite a mountain to climb and get back on the “plus” side of the ledger. Unlike Panasonic, Sony’s worldwide share of television shipments held pretty steadily in 2013 (about 7%, down slightly from 2012), but that number either has to go up or further cost-cutting must take place to make TV retailing worth continuing.
Sony also has to make a decision about its optical disc business unit. The Blu-ray Disc Association (BDA) hasn’t released a standard for 4K yet, while the Digital Entertainment Group’s numbers have shown pretty consistently over the past four years that digital media consumption is shifting emphatically to digital downloads and streaming. Given this trend, it’s not likely that the disc manufacturing unit will ever return to profitability and might also be a candidate for the axe by year’s end.
You know that old saying about the best-laid plans oft going astray? Hmmm…
A Tale Of Two Companies, Revisited
- Published on Friday, 02 May 2014 12:50
- Pete Putman
- 0 Comments
It’s annual meeting time in Japan, and the final reports for fiscal year 2014 are trickling in. (In Japan, the fiscal year starts on April 1 and runs through March 31.)
Given all of the financial misery that Japan Inc. has been enduring for the past four years, you’d probably cringe before opening the latest consolidated financial statements. Yet, there was a surprise this time.
Let’s look at two of the dominant CE brands in Japan – Panasonic and Sony. The former company grabbed some headlines last year when it announced an exit from the plasma display panel (PDP) business, effective 12/31/13. For years, plasma displays and televisions were synonymous with Panasonic – they dominated the market and provided most of the technological breakthroughs that led to the (still to this day, IMHO) “best in class” televisions on the market.
Sometimes “best’ doesn’t always win. Plasma TV shipments and sales had been in steady decline for the past seven years as more and more consumers chose LCD TVs, particularly after 1080p resolution became widespread and national discounters like Vizio forced prices down to bargain-basement levels.
2013’s final numbers from NPD DisplaySearch show that plasma TV shipments from all brands (Panasonic, Samsung, and LG) accounted for slightly more than 4% of the global TV market. You don’t need a weatherman to know which way the wind blows, and Panasonic – who had been in the midst of a massive review of all 80+ of its business units – did the right thing and quickly cut its losses, however painful that may have been.
Now, it appears all of that aggressive restructuring and cost-cutting has paid off. For FY 2014, Panasonic posted a net profit of about ¥120.4 billion, or $1.18B USD. That represents a spectacular turnaround from a ¥754 billion loss in FY 2013, or about $7B USD.
In addition to the money-losing plasma operations, Panasonic also jettisoned its mobile phone business. (Didn’t know they made mobile phones? Neither did most people.) Along with slimming down underperforming business units, finishing the acquisition of Sanyo and all costs associated with it, and shifting their focus to everything from energy storage solutions to Lumix cameras, the company realized an operating profit of ¥305 billion ($2.3B) for the fiscal year.
Now, on to Sony, who has struggled to maintain profitability for several years, thanks in part to the never-ending red ink generated by its television business unit. Sony won’t post its final numbers until May 15, but an advisory went out on May 1 saying that they won’t be pretty – and in fact will be worse than previous guidance suggested.
The company now is forecasting an operating income of ¥26 billion ($255M USD) for FY 2014 when all is said and done. That number represents a steep drop of 67% from the company’s original forecast of ¥80 billion ($783M USD). Sony identified two primary reasons for the drop in income. I’ll quote from the company’s press release:
“Sony expects to record approximately 30 billion yen in additional expenses in the fiscal year ended March 31, 2014 related to exiting the PC business. Since Sony’s announcement on February 6, 2014 that it will exit the PC business, PC sales for the fiscal year ended March 31, 2014 and expected PC sales for the fiscal year ending March 31, 2015 are underperforming the February expectation. Consequently, Sony expects to record write-downs for excess components in inventory and accrual of expenses to compensate suppliers for unused components ordered for Sony’s spring PC lineup. In addition, certain restructuring charges are expected to be recorded ahead of schedule.”
Okay, so the computer operations weren’t pulling their weight, which is why Sony decided to exit stage right and reportedly sell their VAIO operations to Lenovo (as announced in February). But there’s more:
“Sony expects to record approximately 25 billion yen in impairment charges mainly related to its overseas disc manufacturing business. Primarily due to demand for physical media contracting faster than anticipated, mainly in the European region, the future profitability of the disc manufacturing business has been revised. Consequently, Sony has determined that it does not expect to generate sufficient cash flow in the future to recover the carrying amount of long-lived assets, resulting in an expected impairment charge. Primarily due to the reason mentioned above, the fair value of the entire disc manufacturing business also has decreased, resulting in an expected impairment of goodwill.”
Translation: The Blu-ray and DVD business is in the tank, particularly in Europe. Clearly, consumers are turning more and more to cloud storage and streaming of movies and TV shows, and not purchasing or renting optical discs. That’s definitely not good news in Tokyo, but it’s not like this trend snuck up and blindsided the company: I’ve been writing about it for several years now in Display Daily.
Given how aggressively Sony worked a few years ago to convince Warner Home Media and other studios to dump the nascent HD-DVD format in favor of Sony’s home-grown Blu-ray platform, this development must sting all the more. And talk about bad timing: The latest numbers from the Digital Entertainment Group (DEG) show that digital movie sales (streaming and downloads) during the first three months of 2014 totaled $330.25 million, while optical disc sales and revenue were down 13.7% to $1.82 billion from $2.1 billion in the first quarter of 2013, continuing a long-term steady decline that goes all the way back almost a decade.
We won’t have the final numbers from Sony for a few weeks. (Sharp and Toshiba also have yet to report their year-end results.) But you can clearly see what happens when one company faces reality and takes the bull by the horns, while another keeps stalling for time. I’ll check in again in two weeks with the rest of the numbers from Japan, Inc.