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Flat Panel TV Market Penetration on the Rise

Consumers will spend more than $100 billion worldwide on flat panel TVs (FPTV) during 2007, according to the latest market study.

Strategy Analytics predicts that sales of flat panel LCD and plasma TVs will reach 73.7 million units worldwide, generating retail revenues of $104.9 billion, an increase of 17 percent.

HDTV is one of the major growth drivers -- 71 percent of FPTV sales are now HD-ready. Plasma's share continues to slip, from 17.1 percent by unit volume in 2006 to 15.8 percent this year.

Ownership of FPTVs has now reached 41 percent of households in the U.S. and 29 percent in Europe. This latest report predicts that annual sales of FPTVs will reach 180 million units by 2012, but that revenues will peak in 2009 at $130.4 billion before going into decline.

"Flat panels have transformed the TV market over last five years," comments Peter King, Director, Connected Home Devices. "But we expect that market revenues will see only two more years of growth. New features such as 1080p and IP networking will help to add value but will fail to counteract further declines in average selling prices."

"Manufacturer strategies need to recognize impending market saturation," says David Mercer, VP, Digital Consumer Practice. "While investment will be needed to support increasing volume demand, it must also take into account the inevitability of rapidly falling unit prices."

The Flat panel TV is one of more than a dozen digital home device segments tracked by the Strategy Analytics "Connected Home Devices" service. The latest report predicts that total global revenues for digital home devices will reach $249 billion in 2007.

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