Market Watch

US TV Shipments Expected to Decline This Year, Echoing Slide of 2012


Growth will resume in 2014 as LCD TV shipments recover

U.S. television shipments in 2013 are forecast to decline for a second year in a row in view of continued weakness of the domestic market, but growth will resume next year as the liquid crystal display television (LCD TV) segment regains some of the strength it had lost in the past year, according to an IHS iSuppli U.S. Television market tracker report from information and analytics provider IHS.

Shipments in 2013 of televisions into the U.S. market will amount to a projected 36.6 million units, compared to 37.6 million last year. The anticipated 2.7 percent contraction will be smaller than the 5.8 percent slide suffered by the industry in 2012 when domestic TV shipments retreated from 39.9 million units in 2011. However, it will mean that shipments will have declined for two straight years by the time 2013 is over. 

Despite the current negative picture, the industry is poised to see expansion return next year as shipments tick up to 37.8 million units, marking the beginning of at least a four-year run of steady growth.

The drop in U.S. television shipments can be tracked to a combination of two factors—a fall on the one hand in the fortunes of plasma television sets, which peaked in shipments during 2010 but are now coming down; and a downturn in the liquid crystal display television (LCD TV) segment, one of the most mature in the world. Plasma TV shipments last year shrank a steep 24 percent to 3.6 million units compared to their 2011 level, and LCD TV shipments descended 3 percent to 33.8 million units.

But while plasma shipments will continue to be down this year as part of an irreversible trend toward decline, LCD TV shipments will be up 3 percent, reversing the losses of last year and coming close to the segment’s 2011 shipment level. LCD TV shipments will grow another 6 percent next year, pulling the U.S. TV space out of its slump toward an overall increase.

Meanwhile, the introduction of organic light-emitting diode (OLED) televisions will start to work its magic on the industry, especially because the advanced sets will sport perfect black colors and much-thinner profiles than already slim-based LED-backlit sets. South Korea’s LG Electronics and Samsung Electronics will lob the first volleys in the first half of 2013 by each launching 55-inch models—first previewed in January at the Consumer Electronics Show in Las Vegas, and vastly different from the tiny 11- and 15-inch OLED TVs shown several years ago. 

A total of just 56,000 OLED TVs will ship cumulatively in 2013 and 2014, with sets commanding extremely high retail pricing because of a lack of widescale manufacturing. But shipment numbers will grow quickly from 2014 onward, jumping to 370,000 by 2015, and then surging to 1.9 million units by 2017. Revenue from OLED TVs could reach as much as 21 percent of the total TV market revenue for that year. Owing to the high retail price of OLED TVs, this display type will account for a bigger percentage of the total TV market revenue than of shipments.

Read More >> U.S. TV Shipments Drop by 3 percent in 2012