Thursday, June 28, 2012

Global TV Shipments Declined as Consumers Refocus

According to the latest market study by DisplaySearch, television set shipments fell almost 8 percent worldwide year-on-year in the first quarter of 2012 -- that's the steepest rate of decline since the second quarter of 2009.

Total TV shipments for the quarter were 51 million units. The biggest contributor to the decline was a slowdown in shipments of LCD TVs, which fell year-on-year for the first time in the history of the category -- declining just over 3 percent, to 43 million units.

"Soft demand and cautious expectations about the upcoming year in many parts of the TV supply chain have led to a slowdown in shipments," noted Paul Gagnon, NPD DisplaySearch Director of North America TV Research.

LCD TV shipment share fell slightly from Q4’11, but is up four percentage points from a year ago, to 84.2 percent. LCD TV is capturing market share at 40” and larger screen sizes because of a sharp decline in plasma TV demand.

The average LCD TV screen size increased 5 percent Y/Y in Q1’12, passing 35” for the first time, with gains in both emerging and developed markets. The share of LCD TVs with LED backlights also increased, from 51 percent in Q4’11 to almost 56 percent in Q1’12.

Plasma TV unit shipments continued to decline, falling 18 percent Y/Y in Q1’12 after an 8 percent decline in Q4’11. The popularity of plasma TV among consumers is waning, and a large majority of the recent shipment volume remains centered on low-priced 2D HD models.

Despite the weak results on a unit basis, demand for larger sizes continues to grow. The market share for 40” and larger TVs increased from just under 31 percent a year ago to more than 37 percent in Q1’12 -- with total unit shipments for 40”+ rising 12 percent Y/Y.

Larger sizes have become much more affordable with 40-44” LCD TV average prices below $600 and new 50” LCD TVs selling for less than $1000, joining 50”-class plasma TVs that have been selling for less than $700 for several quarters now.

3D shipment share continues to grow, but more slowly in recent quarters, rising to just over 14 percent of total TV shipments and 16 percent of flat panel TV shipments.

Demand for 3D in emerging regions is actually higher than in developed regions, with 16 percent of flat panel TV units shipped to emerging markets in Q1’12 compared to 15 percent among developed regions.

This latest report left me wondering, has the global consumer interest in traditional television programming faded, or have viewers refocused their attention on other devices that are used for video entertainment -- such as media tablets? Perhaps it's a combination of both trends.

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