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New Generation of Entertainment Hardware

Global TV shipments rose 4 million to almost 200 million units -- worth over$100 billion last year -- and growth will accelerate to reach 280 million units -- worth $160 billion by 2012 -- according to a new consumer electronics industry report from Understanding & Solutions.

The global TV boom is being powered by consumer desire for Flat Panel TV, which is rapidly replacing CRT (Cathode Ray Tube) sets, plus growth in emerging markets, which are also trending away from CRT to flat panels. Emerging markets accounted for over 50 percent of global TV shipments in 2007 and will rise to more than 65 percent by 2012.

LCD is rapidly growing to become the dominant display technology for television, and accounted for 40 percent of shipments in 2007 and 64 percent of market value. By 2012, LCD will account for over 80 percent of the market.

"Strategic supply of LCD panels has become a critical competitive issue, with huge concentrations of volume under the control of major producers, including manufacturing joint ventures between TV brand leaders Samsung-Sony and LG-Philips," says David Watkins, senior analyst at Understanding & Solutions.

Following significant price decline in 2006, the rising cost of raw materials and strong demand for LCD in TVs and notebook computers meant prices were relatively stable in 2007. TV manufacturers are also having to add cost with new features like digital tuners and high definition connectivity(HDMI), while at the same time introducing fire retardant and recyclable materials.

The flat panel trend is fueling consumer appetite for larger TV screens worldwide, not just for the living room but in bedrooms, playrooms and other locations around the home. For example, shipments of TVs with screens larger than 37" in Europe have risen from just 4 percent of total in 2004 to 23 percent in 2007, and are set to rise to over 40 percent by 2012, according to Understanding & Solutions research.

Average prices have been moving up as consumers opt for larger screens. Average selling prices in the UK rose 5 percent in 2007, for example, according to Understanding & Solutions data.

The larger screen trend is in turn driving rollout of High Definition TV and will also boost demand for a new generation of Blu-ray high definition video. The relationship between consumers and the TV screen is changing.

High definition home theater is an experience to compare with visiting the cinema and is creating need for a new generation of entertainment media and consumer electronics hardware.

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