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Market Insight

Sony announces pricing of two new UHD TV models

May 13, 2013

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Sony is releasing two additional Ultra High Definition (UHD) TV models into the US market. The 55-inch and 65-inch models, priced at $5,000 and $7,000 respectively, were originally unveiled at CES in January 2013. Sony released their first UHD TV in November 2012, an 84-inch TV with a retail price of $25,000.

UHD TV sets have been commercially available since Q4 2012, with wider availability of models beginning to ship in Q2 2013. The initial pricing structure for UHD was aimed at capturing a premium product status - for instance, LG and Samsung also launched their first UHD TV models at similar prices, with LG's 84-inch LM9600 Series model and Samsung's 85-inch S9 Series UHD TV coming to market at $20,000 and $40,000 respectively. However, pricing for UHD is becoming ever more competitive, as TV manufacturers and retailers alike look to push the technology to expand the market size.
The product launch from Sony shows both that UHD TV launches are occurring at more common screen sizes (particularly the popular 55-inch category) and that UHD TV pricing is quickly decreasing. These changes are being led by developments in UHD LCD panel production. Mass-producing Taiwanese panel manufacturers like AUO and Innolux (previously known as CMI) supply much of the TV market, and as they increase UHD shipment volumes to capture a wider range of manufacturers, prices are being forced down. Innolux in particular has significantly cut costs for UHD panels - using half the number of T-cons and other picture driving components within the TV to scale to an image which has effective resolution between Full HD and UHD. These panels are utilised in recent TVs launched in the US market, such as the $1,500 Seiki 50-inch model, the $2,500 Westinghouse 50-inch model and the $4,000 Westinghouse 65-inch model.
While smaller screen size models may help achieve mass marketability, the drawback is the more limited extent to which they can deliver a noticeable difference in picture quality to HD. Alternatively, cost reductions could also be realised since this implies the reduced visibility of errors and dead pixels, raising the acceptable percentage of dead pixels for a produced model. As increasing volumes of cheaper, low performance 4K panels continue to induce downward pressure on end product TV prices, there remains the potential for a comparatively faster consumer adoption of UHD TVs over HD TVs. This prospect remains contingent on whether manufacturers can delicately balance effectively conveying an improved user experience to consumers while achieving production efficiencies cutting unnecessary costs.

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