LED TV Prices to Drop in 2010

By Leslie Meredith
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Prices on 2010 Vizio LED TVs to match traditional LCD HDTVs

Samsung’s LED TVs were the Cinderella story of 2009. Despite a faltering economy, Samsung positioned their LED TV line at the top — twice the price of their same-sized LCD models — and will end the year with approximately 2 million units sold, representing 60 percent of the LED market. According to Samsung’s president, Yoon Boo-kuen, the company plans to sell five times that number in 2010, but will face heated competition.

Quick to seize an opportunity, bargain manufacturers will begin to sell LED TVs in 2010, offering consumers less expensive models. The list of TV manufacturers poised to sell LED TVs beginning in January includes every household name and lesser-known brands like Korea’s Haier and California-based AOC.

Vizio got a jump on the competition and launched the first value-priced LED TV in September at one-third the price of a comparably-sized Samsung model, and plans to follow up in 2010 with more aggressively priced LED TVs. “We will provide LED TVs in sizes smaller than 32” at prices that we believe will allow them to replace CCFL backlighting,” said Laynie Newsome, Vizio Co-founder, “We expect that TruLED and Razor LED LCD HDTVs will represent 60% of our total HDTV shipment mix in 2010.”

For the price of a pair of Uggs, Vizio offers LED technology on screens that are less than an inch thick.

Volume production and the addition of LED backlighting to lower end LCD TVs will drive the price down, closing the gap between the standard LCD TVs lit with cold cathode flourescent lamps (CCFL) and LEDs. Industry research firm iSuppli predicts a difference of less than $100 between the 40/42-iinch CCFL and LED-based panels, and below $150 for 46-inch panels in 2010.

Environmentalist like to claim the success of LED technology is due to its energy-saving benefits, which can be as high as 40 percent over standard LCDs. While this is certainly a factor, particularly in light of California’s new TV energy guidelines, LED backlights allow for the thinnest profiles available on the TV market, a powerful attraction for TV enthusiasts. LED supporters praise the technology for offering a longer lifespan, and offer more vivid images, with greater contrast and color range.

Samsung propelled LED TVs to the position of ‘most desirable’ using innovative marketing strategies that stuck with the consumer. Breaking new ground in video marketing, Samsung’s Extreme Sheep LED Art launched last March on YouTube with no Samsung branding, simply a mention in the adjacent description. The video shot to the top of the Ad Age Viral Video chart, garnered weeks of media attention, captured the imagination of the consumer, which translated into a quick take-off of LED TV sales, even amidst competitors’ cries of “foul.”

Earlier this year, after acknowledging a loss of 36.5 percent in Sony Bravia TV sales, Sony executives claimed that the term LED TV is a "term exploited by some companies to increase the status of their brands in the mindshare of average consumers."

True, LED TV is not a separate category like plasma and LCD. LED is a subset of LCD. Samsung cleverly marketed the TVs as LED TVs, a shortened version of LED backlit LCD TVs. Retailers followed the strategy.

Indianapolis-based electronics and appliances retailer hhgregg displays LED TVs as a separate category on their Website, and according to Dayton, Ohio sales associate Nathan Coffee, customers see LED TVs as a separate type of TV, asking for it by name. “Six months ago, people came in asking about the difference between LCD and plasma,” Coffee said, “Now they ask about LED in the same sentence.”

Strategy Analytics forecasts that the market for LED TVs will see rapid growth starting in 2010, as manufacturers deploy this technology in volume. The market will accelerate at a compound average growth rate (CAGR) of 148 percent to reach $7.5B through 2013. Strategy Analytics concludes that by 2013 some 68 percent of all LCD TVs will feature LED backlights.

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