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Slow Ramp for Ultra HDTVs: Study

4K Units to Represent 4.8% of Total TV Shipments in North America by 2016, According to DisplaySearch 1/30/2013 8:32 AM Eastern

Ultra HD televisions, which offer four times the resolution depth of “full HD” 1080p displays, were prominently featured at this month’s International CES -- but high prices and limited native content will keep them a niche segment for the next four years, according to a forecast by NPD DisplaySearch.

In 2013, just 63,200 Ultra HD (or “4K by 2K”) units will ship in North America, representing 0.1% of the overall market of 42.31 million TVs, the research firm said. That will increase to 2.098 million Ultra HDTV shipments by 2016, projected to be 4.8% of the 43.9 million televisions shipping in North America, according to DisplaySearch.

“The availability of content is key to consumer adoption of 4K×2K TVs, and TV manufacturers are anxious to prevent any potential delays that could stall adoption, as was the case with 3DTVs,” DisplaySearch director of TV electronics research Paul Gray said.

At CES, Sony announced that it would launch an Ultra HD movie download service this summer and that it would begin selling a handful of Blu-ray Disc titles sourced from 4K masters. However, Gray noted, Ultra HD services from satellite and cable providers “will take some time” to develop.

Worldwide, DisplaySearch expects about 500,000 4K TVs to ship worldwide this year (0.2% of all shipments), growing to more than 7 million by 2016 (2.6% of all shipments).

TV manufacturers including Sony, LG, Samsung and Sharp are all moving ahead on Ultra HD along with other Japanese brands, the six leading Chinese brands and value-oriented brands such as Vizio and Funai, according to Gray. In addition to vertical integration by the major players, merchant panel suppliers such as AUO and Innolux are working with several manufacturers on 4K×2K.

Prices today for the advanced sets are sky-high: Sony's initial 84-inch Ultra HD TV is $25,000. The set comes with a collection of 10 full-length feature films in 4K format, including The Amazing Spider-Man, Battle: Los Angeles, That's My Boy, Total Recall 2012 and Taxi Driver.

This year China is forecast to lead in demand for 4K TVs, with shipments forecast to grow from 333,000 in 2013 to more than 2.6 million in 2016, Gray said. “Initially, we expect to see the highest 4K×2K adoption in China, Japan and Western Europe, as these regions typically prefer the latest highly featured products,” he said. “On the other hand, North American consumers are generally more likely to delay purchases of new technology, like 4K×2K, until prices fall.”

According to DisplaySearch, the U.S. comprises around 90% of the North American market; the firm does not include Mexico in its North America figures.

Pay TV providers are expected to deliver Ultra HD/4K content using the High Efficiency Video Coding (HEVC) standard, which uses 50% as much bandwidth as the current MPEG-4 format. The International Telecommunication Union last Friday granted initial approval of HEVC.