Austin, Tex. — Global TV shipments grew 2 percent, reaching 211 million units, with flat panel TV technologies including LCD enjoying better unit growth in 2009 compared to 2008, rising 37 percent versus 34 percent, respectively, according to a report from DisplaySearch. However, overall TV shipments fell seven percent and average selling prices (ASPs) dropped eight percent in 2009, according to the market researcher.
The report, “Quarterly Advanced Global TV Shipment and Forecast Report,” indicates that the fourth quarter of 2009 experienced even stronger year-over-year (Y/Y) unit shipment growth, rising 17 percent Y/Y overall with LCD TVs climbing 50 percent Y/Y.
One of the key growth drivers was higher ASP erosion driven by cost reductions at the component level, but also by decreasing margins at the brand and retail level, reports DisplaySearch. The global volume-weighted ASP declined more than 8 percent worldwide and fell as much as 24 percent Y/Y for LCD TVs, the largest decline since DisplaySearch began tracking the TV marketplace.
Because consumers adjusted their buying behavior to match their budgets during the 2009 recession, this means that growth in sub-40″ LCD TVs outpaced growth of big screens in mature developed markets like North America during 2009, despite the introduction of advanced new TV technologies to larger screen sizes, like LED-backlit LCD TVs and internet connected sets, stated Paul Gagnon, director of North America TV Market Research for DisplaySearch.
Offering benefits such as lower power consumption, thinner and lighter cabinet designs, and better picture quality, premiums for LED-backlit LCD TVs have been prohibitively high until 2009, and are expected to narrow much further in 2010 with explosive growth expected, reports DisplaySearch.
DisplaySearch says LED-backlit LCD TVs only accounted for 4 percent of global units in the fourth quarter of 2009, but they had an 11 percent share of 40-inch and larger shipments, and a 24 percent share of shipments of 50-inch and larger.
Samsung achieved its highest revenue share ever, reaching a record 23.6 percent of global TV revenues in the fourth quarter of 2009 thanks in part to its strong mix of larger screen sizes as well as leading positions in advanced technologies like LED backlit and high-frame-rate LCD TVs, which come with higher price tags, says DisplaySearch.
Samsung was followed by LGE and Sony. DisplaySearch says LGE, in the number 2 position, demonstrated the strongest annual growth among the top five brands, an indication of the company’s aggressive market share growth campaign in 2009. LGE’s fourth quarter revenue rose slightly to 13 percent.
Sony came in at number three in global TV revenues during the fourth quarter of 2009 at 11.5 percent, according to DisplaySearch. Sony had the largest Q/Q shipment growth among the top five in this quarter; however, Sony’s full year 2009 total TV revenue share was down almost 2 percentage points from 2008, to 11.5 percent, and is at the lowest level since 2005 when it last led the overall TV market, reports DisplaySearch.
iSuppli Corp. (El Segundo, Calif.) reports that Vizio Inc. became the leading LCD-TV brand in the U.S. in 2009 while Samsung Electronics Co. Ltd. took the top spot in overall flat-panel television market for the year, according to iSuppli Corp.
U.S.-based Vizio’s LCD-TV shipments nearly doubled in 2009, rising to 5.9 million units, up 92.1 percent from 3.1 million in 2008, which exceeded the 29 percent growth of the overall U.S. LCD-TV market in 2009, says iSuppli. It also represents the strongest growth among the Top-6 brands. Company market share rose to 18.7 percent for the year, up from 12.6 percent in 2008.
“The company already has established itself as the price leader in LCD-TVs. The company played to this strength in 2009 by offering attractive promotions to consumers. Furthermore, Vizio moved to make its LCD-TV products more competitive with premium brands, adding higher-end features such as LED backlights and Internet connectivity,” said Riddhi Patel, director, television systems and retail services for iSuppli, in a statement.
Yet, when looking at the overall U.S. flat-panel television market, consisting of both LCD-TVs and plasma sets, South Korea’s Samsung retained leadership in 2009, due to the success of its LED-backlit LCD TVs and strong price competitiveness, says iSuppli. Samsung’s U.S. flat-panel television shipments rose to 6.6 million units in 2009, up 22.6 percent from 5.4 million units in 2008.
Rounding out the top six are Sony, Toshiba, LG Electronics and Sharp. Toshiba achieved a 81.7 percent increase in unit shipments in 2009, while Sony claimed the best performer in the fourth quarter in the U.S. LCD-TV market with its share rising to 13.2 percent, up from 7.7 percent in the third quarter, reports iSuppli.
LED backlight costs drop, while large LCD panel prices rise
In terms of component costs, pricing for LED backlights are falling faster than conventional LCD backlights, according to DisplaySearch’s latest “Quarterly LED & CCFL Backlight Cost Report.”
The report finds that that the average cost of a 40-inch edge-LED backlight unit in the first quarter of 2010 is $118, and will fall to $100 by the fourth quarter of 2010. The market researcher says the cost reduction is driven by increasing production volumes, which impacts LED and material costs, and by improvement in LED luminous intensity, which enables the use of fewer LED chips.
The core components in a TV with an LED backlight unit — LED chips, light guide plate (LGP), and dual brightness enhancement film (DBEF) — are not used in conventional CCFL backlight units for LCD TVs, says DisplaySearch. For the 40-inch LED backlight cost, the light source including the LED assembly accounts for 34 percent of the bill of materials, the LGP is 13 percent, and the DBEF is 15 percent. As a result, LED design, output, and chip cost will be key for LED backlight cost reduction, says DisplaySearch.
iSuppli paints a different picture for large-sized LCD panels. The market researcher reports that TV and PC makers are building inventories of large-sized LCD panels — diagonal dimension of 10 inches or more — in the first quarter, which is driving up prices and limiting the market’s normal first-quarter revenue dip.
iSuppli estimates that average panel pricing in February will rise by $2 to $3 for monitors, $1 to $2 for notebooks and $2 to $3 for televisions. If February pricing follows iSuppli’s forecasts, this will represent the second month in a row that all major applications for large-sized LCDs have seen an increase in panel pricing, says the market researcher.
In January, overall LCD panel pricing increased by 2 percent, also due to inventory replenishment and tight panel supply, while television panel pricing rose by 0.3 percent for the month, reports iSuppli.
However, in the second quarter, iSuppli expects television panel pricing to remain flat or to show some softness.
“On the demand side, pricing softness will be the result of slowing sales as North American brands finish their new-model launch preparations and China’s Labor Day holiday season ends,” said Sweta Dash, senior director, LCD research at iSuppli, in a statement. “On the supply side, LG Display’s 7.5-generation panel fab and Samsung LCD’s 7.1-generation facility will be fully depreciated by the second quarter. This will allow both companies to reduce cost and improve profitability more than other suppliers.”
Dash also noted that limited capacity increases for television panels in the second half of 2010 would help stabilize panel pricing and prevent further declines.
The iSuppli report, “Strong Inventory Replenishment Demand Pushes Large-LCD Panel Market Back to Tight Supply” indicates that global revenue from shipments of large-sized LCD panels is set to decline to $17.3 billion in the first quarter of 2010, down only 5.1 percent from $18.2 billion in the fourth quarter of 2009.
The market in the first quarter posted significant growth compared to the same period in 2009 with revenue rising 66 percent from $10.4 billion in the first quarter of 2009, reports iSuppli.