iSuppli: US TV market can expect a second year of decline

Michelle Clancy | 10-04-2013
US television shipments are forecast to decline for a second year in a row in 2013, but growth will resume next year as the LCD TV segment regains some of the strength it had lost in the past year.
Shipments of televisions into the US market in 2013 will amount to a projected 36.6 million units, compared to 37.6 million last year, according to an IHS iSuppli US Television Market Tracker Report from information and analytics provider IHS. The anticipated 2.7% contraction will be smaller than the 5.8% 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.
"US television demand is being hit by the double whammy of the plunge in both the plasma and LCD TV segments," said Veronica Thayer, analyst for consumer electronics and technology at IHS. "After peaking in 2010, plasma sales now are on a terminal decline. Meanwhile, the mature US LCD TV market contracted in 2012 as most consumers already own one or more sets."
Plasma TV shipments last year shrank a steep 24% to 3.6 million units compared to their 2011 level, and LCD TV shipments descended 3% to 33.8 million units.
But while plasma shipments will continue to be down this year as part of an irreversible trend toward extinction, LCD TV shipments will be up 3% this year, reversing the losses of last year and coming close to the segment's 2011 shipment level. LCD TV shipments will grow another 6% next year, pulling the overall US TV space out of its slump, the firm said.
Meanwhile, the introduction of OLED televisions will start to catch on. 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 large-scale 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% 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 larger percentage of revenue compared to shipments in the total US TV market, IHS said.