The Anatomy of a “Good Start”

Like a milepost on the way to market, a recent study by NPD Group shows that $55M in 3D-capable flat-panel TVs and BRD players were sold in the US in the first three months since their launch in February. In just going with the numbers, the mainstream press seize on the fact that the $55M in sales or about 20K sets represents just a tiny fraction of total TV sales.

To help put things in perspective, Riddhi Patel of iSuppli said, "Shipments of all types of LCD-TVs are expected to hit 170M this year, while shipments of LED-backlit sets will reach only 26M globally in 2010."

Insight Media pegs the 2010 3D sales number at 3.3M units, or just about 2% (1.94%) of iSuppli’s total unit TV sales number.

Global sales in 3D technology are likely to range between 50M units by 2015 (Insight Media forecast) to 78M units (iSuppli forecast) by the end of that year. According to Patel, "Robust growth of 3DTV sales appears to be assured during the next few years." But she cautions that full adoption of 3DTV is still hampered by issues of "standardization, content availability and interoperability of the 3D glasses."

But that’s just the point, anyone buying a 3DTV capable set today is either an early adopter, or wanting to "future-proof" a flat screen purchase they would have made anyway. For now, we see home 3D viewing as event driven, not a ubiquitous upgrade that forces the family to wear glasses every time they turn the set on, but rather an enhancement that adds to the viewing experience.

But does the $55M in sales represent a good start, or slow start for the industry? The LA Times took up the question today, with the headline: "3-D TV sets are selling, but no instant craze." They quote the NPD study and estimate that 20K sets were sold to make the $55M number. Then, they turned to CEA to get an overall 7M sets sold in the same period. That’s just 0.28% of the total sets sold in the same period. Let’s call that 3 TV sets out of every 1000 sets sold in the US were 3D capable in the first three months of sales.

At face value, it does seem like a slow start… But we think the early numbers suggests that the 3D CE-product market is about to catch fire among consumers. And, the party is just beginning, according to Ross Rubin, executive director at NPD. "3DTV and Blu-ray players are seeing steady growth even as major product line launches are slated for the coming months," he said.

In Europe, GfK Group said 25K 3DTVs had been sold by the end of May. Samsung was first over there with a 40-inch 3D set (UE40C7000) that started selling in late February, but the company recently upgraded its offering with a larger 46-inch display (UE46C8000) currently going head-to head with Panasonic’s 50-inch 3D capable PDP set. The point is, this is still early days for 3D in the US and Europe with plenty to still be worked out by the industry.

Also, the NPD numbers do not show some major 3D product rollouts (i.e. Sony’s), which hit the market in July, nor do they reflect the spike in demand some analysts predicted would come from the World Cup finals and their broadcast (in part) in 3D by ESPN.

Add to this a recent Parks study that looks at 3D content preference that seems to indicate 3D films will drive sales with 40% of the respondents saying they are interested in viewing movies in 3D on their TV. The string of 3D box office hits coming out of Hollywood of late will help drive demand for home 3D viewing even further.

So take your pick, is the glass half full, or half empty? "3DTV will be a premium home entertainment experience in 2010," said NPD’s Rubin. We agree, the road ahead for 3DTV adoption seems to be clear, particularly in mature TV regions like the US and Europe. There are still bumps to navigate. This includes quality of 3D content, availability of 3D content, as well as standards and interoperability issues (for both the TV sets, content delivery and glasses). Nevertheless, we see the summer 3D blockbusters and special 3D sports venues helping to heat up the market, giving those early adopters something new to show off in the living room.

By Steve Sechrist, Display Daily