$10K price tag expected to hamper market for OLED TVs

Michelle Clancy | 31-07-2012

TV sales are holding steady, but high-end OLED TVs are expected to comprise less than 1% of flat panel TV sales through at least 2013, reaching 9% of units by 2017, according to new data from ABI Research.

In contrast, LED/LCD TVs, which often offer thinner form factors and less power consumption over traditional LCD TVs, are expected to grow from 35% of the market in 2011 to 75% in 2017.

One good reason for that is the fact that in 2012, OLED TVs from Samsung and LG are expected to cost well over $5,000 (closer to $10,000) at sizes less than 60 inches. Meanwhile, Sony and Panasonic, who are are partnering to release larger-screen OLED TVs in 2013, will offer a similar procing scheme.

"Primary research conducted in the US continues to suggest most consumers place price and screen size above all other factors," says practice director Sam Rosen. "While display technology is cited as very important as well, the prices OLED TVs are expected to command, at least through 2013, will make it a difficult sell for most consumers."

At these prices, he noted, consumers are challenged with selecting picture quality and form factor over size – not a winning strategy considering that an equivalent-sized LED TV costs thousands less.
"At these prices you are close to Sharp's new 90-inch LED TV (Sharp's 80-inch LED TV can be had for prices closer to $4,000)," said Rosen.

2012's crop of OLED TVs are not the first as Sony introduced much smaller screens in the past, but price and screen size again conspired to make the market for OLED TVs rather limited. Scale will eventually bring prices down, but with LED TVs supporting form factors approaching the svelteness of OLED TVs, many consumers may still opt for the less expensive alternative, limiting the rate at which scale is reached.

"Picture quality is also highlighted as a key benefit for OLED screens, but consumer behavior suggests this might not engender as much perceived value as some might presuppose," said senior analyst Michael Inouye. "Higher contrast ratios and more vibrant colors, while nice, will continue to lose out to screen size and price for those consumers who embrace and fully enjoy streaming video, think Blu-ray picture is good, but still enjoy DVD.

"In the end, OLED TVs, at least in the beginning, will likely be more of a statement of status or strong appreciation of form factor than video quality," he added.