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IHS: Domestic Q1 TV Shipments Decline, Prices Rise

3 Jun, 2013 By: Erik Gruenwedel

Plasma TV shipments plummet 39% as market is dominated by LCD

Shipments of television sets in the United States declined 11% in the first quarter of 2013, compared with one year earlier, according to a new report from IHS iSuppli. At the same time, retail prices rose 3% as consumers slowly gravitate toward larger screens and Internet-based smart TVs.

Shipments dropped to 6.6 million units, down from 7.4 million a year ago. Liquid-crystal display (LCD) televisions decreased by 7%, while plasma plunged 39% — underscoring a market shift toward LCD.

The fall in the United States reflected the worldwide decrease of television shipments during the first quarter. However, global TV shipments declined far lower, down by less than 2%, according to IHS.

The contraction in global volumes was driven by the decline in the remaining markets for bulky analog cathode ray tube (CRT) sets as well as by the reduction in plasma demand. Other factors included a widespread cutback in LCD TV manufacturing volumes by major Japanese vendors, and a repositioning of the market toward fewer, larger-sized TV sets in the mature markets.

“The U.S. market is starting to reposition toward higher-end TV sets,” said Veronica Thayer, analyst for consumer electronics & technology at IHS. “Now that most homes have at least one flat-panel TV, consumers have become more discerning in their tastes and place more value on features like light-emitting diode (LED) backlighting, supersized screens and interactive smart TVs.”

Supersized LCD TV sets larger than 50 inches accounted for 27% of domestic unit shipments in Q1, up from 15% one year before. Furthermore, these large sets represented more than half of all U.S. LCD TV revenue, up sharply from 39% one year earlier.

Due to increased shipments of 50-inch and 60-inch sets, the average retail price for LCD TVs in the U.S. increased to $704 from $682 one year earlier.
Meanwhile, LED-backlit sets increased their share of U.S. TV unit shipments to 72%, up from 37% during the first quarter of 2012. LED sets accounted for 76% of total TV revenue, up from 52%.

Samsung again led the U.S. market for all types of televisions and in the LCD segment, despite strong gains by Vizio.

Samsung accounted for 31% of overall U.S. television market revenue, up from 30% during the same period in 2012. The company also expanded its share of U.S. LCD TV revenue to 28%, up from 27% one year earlier.

Meanwhile, Irvine, Calif.-based Vizio increased its share of TV revenue sharply, rising to 16%, up from 11% in 2012. The company also boosted its portion of the domestic LCD TV revenue to 18%, up from 14% one year earlier, due to the increase in number of large-screen-size TV models offered, particularly the very successful 60-inch, and helped by the brand’s entry into Best Buy.

In terms of volume, the squeeze on the total number of shipped TVs still favored Samsung, with 1.6 million units in the first quarter this year. However, Vizio managed to edge out Samsung on U.S. LCD TV volume during the period by a few thousand units.

“Samsung has retained its position as the leading premium television brand in the United States by capitalizing on demand for premium features, but Vizio is making strong moves in volumes and larger-sized models, although its current revenue is still lower,” Thayer said. “Ultimately, feature-rich sets and large screen sizes lead to higher TV [average retail prices], which can provide an opportunity for manufacturers to regain margins.”

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