Demand improving for LCD TVs

Thursday, December 31, 2009

di 4:20 PM

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Yet another consumer electronics segment is bouncing back from the recession--demand for LCD TVs is showing new signs of life.

Third-quarter shipments of LCD TVs rose for the first time in a year, according to DisplaySearch's "Quarterly Global TV Shipment and Forecast Report," released Wednesday. That upward motion suggests that TV sales for the first quarter of 2010 could surpass those of the first quarter of 2009, the first gain in six quarters.


Total TV shipments will climb 6 percent in 2010 to reach 218 million units, versus 205 million for 2009, according to DisplaySearch's forecast. LCD TV shipments specifically will account for around 170 million units in 2010 versus 140.5 million this year.

TV manufacturers and vendors can thank North America, Japan, and Western Europe, where consumer demand continues to grow. But emerging markets have also developed more of an appetite for flat-panel TVs.

"China is a hot growth engine for the global flat panel TV market as the transition from CRT to LCD and plasma TVs continues to drive market growth," said Hisakazu Torii, vice president of TV market research for DisplaySearch, in a statement. "Government stimulus activity is having a positive effect on demand for flat panel TVs in both China and Japan, while several upcoming analog-to-digital broadcast changes in 2010 are likely to increase demand in Western Europe for digital TVs. Meanwhile, large price declines in North America have been driving strong unit demand, especially for 19" to 32" sizes."

Price declines of 9 percent this year for all flavors of TVs have hurt revenue but boosted demand, with 2009 revenue likely to drop 10 percent to $101 billion from $112 billion last year. But prices will not fall as much in 2010, says DisplaySearch, and so continued consumer demand will reward the industry with some sales growth next year.

Around 14.6 million plasma TVs are expected to ship next year thanks to growing demand in China. Meanwhile, the older CRT (cathode ray tube) TV continues to hang in there, with 32 million units likely to ship in 2010, predicts DisplaySearch. But that forecast is lower than the company's previous estimate based on declining demand and a dwindling supply of key components.

Alternative technologies like LED-backlit LCDs and 3D TVs will play a role in driving growth for the industry. Demand for LED-backlit TVs will jump in 2010, according to DisplaySearch, with just about every TV manufacturer bringing a variety of models and sizes to the market.

LCDs with higher frame rates will catch on as manufacturers add higher performance features to their TVs, DisplaySearch said. TVs with 100/120 Hz frame rates will capture 26 percent of global sales in 2009, while those with rates of 200/240 Hz will soak up only about 5 percent. But by 2013, 100/120 Hz TVs will account for 31 percent of global revenue, with 200/240 Hz TVs winning nearly 20 percent.