Cable Operators

Happy HDTV Holidays

11/14/2009 2:00 AM Eastern

More Americans than ever are out of a job — but millions will be treating themselves to shiny new high-definition TVs this Christmas.

HDTVs are expected to fly off the shelves this holiday-shopping season, as prices for big-screen sets continue to plummet. “Consumers love flat-panel displays, and they love HD,” said Shawn DuBravac, the Consumer Electronics Association's chief economist and director of research.

flat-panel-hdtv.jpgLCD TV shipments, which represent the bulk of the television category, are set to hit 8 million units in the fourth quarter, up 7.3% from the same period last year, based on a preliminary forecast by iSuppli. For the full year, the research firm expects 37.3 million HDTVs to be sold in North America in 2009 — a 17% increase over last year.

“The reason for that strong growth is the fact that the prices are very, very aggressive,” iSuppli principal analyst Riddhi Patel said. “It won't be only on the basic models. It will be on the more advanced ones, too.”

The run on HDTVs comes even as U.S. consumers remain pessimistic about their jobs and income prospects. Consumer confidence for November fell to its lowest level since August and was well below economists' forecasts, according to the Reuters/University of Michigan Surveys of Consumers released last week. The national unemployment rate in October topped 10% for the first time in 25 years.

But never mind all that — we want our HDTVs!

“Consumers are upgrading second and third sets, and later adopters are opting for smaller sets,” DuBravac said.

Although about 60% of U.S. households now have at least one HDTV, that means more than 45 million don't, he added. Americans own an average of 2.6 TVs, according to Nielsen.

Tough economic times have actually fueled HDTV sales, as consumers splurge on a television instead of bigger-ticket leisure activities like vacations, according to Patel.

“Consumers are getting their entertainment at home because that's the best they can do,” she said.

And HDTVs are becoming increasingly affordable. The average pricing for 42-inch LCD TVs is set to fall to $639 in the fourth quarter of 2009, down from $768 a year ago, iSuppli predicts. Pricing for premium LCD TV brands on “Black Friday” (the day after Thanksgiving) will be as low as $299 for some 32-inch HDTVs and to $499 for 42-inch HD models.

With 32-inch sets selling for $300, noted DuBravac, “Suddenly, I'm finding new places to put flat panels in my house.”

According to CEA estimates, unit shipments across all consumer-electronics categories will be up about 6% year-to-year. While sales of HDTVs in the fourth quarter are anticipated to increase year-over-year in terms of dollar spending, revenue for all consumer electronics is expected to decline about 7.5%.

Besides strong HDTV sales, Blu-ray Disc players “look like they'll have an amazing fourth quarter,” DuBravac said. In 2008, Blu-ray player shipments hit about 2.7 million. Manufacturers sold 3.7 million units through the third quarter, so as many as 7 million Blu-ray players could be purchased in 2009, DuBravac said.


WISH LISTS
Consumer-electronics manufacturers and retailers are hoping for merry sales:

SOURCES: iSuppli, Consumer Electronics Association
8 million LCD HDTVs expected to be sold in Q4 (up 7.3% vs. 2008)
85% of flat-panel TVs sold are LCD
$222: average amount planned for consumer-electronics gifts this holiday season (up 8% vs. 2008)
$500: Black Friday prices for some 42-inch LCD TVs
48% of LCD TVs purchased by U.S. consumers in Q3 were on sale
33% of consumers begin buying gifts in November

 

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