By Paul Gagnon
Along with my colleagues, I attended the LGE US press conference this morning to kick off our coverage of CES 2014. LGE has held the opening press conference at CES on Press Day for a number of years now, and the press corps was in full attendance. Other key unveilings were made by Samsung and Vizio.
While the range of products covered by LG was indeed vast as expected for such a broad-based consumer electronics company, we were focused on TV announcements. LG had a wide range of things to say on TV, notably confirming its commitment to two TV technologies that have been under a lot of scrutiny in recent years. First, LG will indeed field a line of five plasma TVs in the US for 2014, despite Panasonic exiting the category in late 2013. That’s a pretty narrow field of products, but will still be a meaningful business for 2014 according to LG. Of course, even with products announced for 2014, there is still room for a gradual ramp down in volume later in the year if demand stays on the current mid double-digit Y/Y declines in shipments.
Second, not only will LG continue to field OLED TVs in 2014, but it will expand the lineup from one to five models this year, three of which are 4K resolution. In our latest forecast, we reduced our expectation for OLED TVs in 2014 from 250,000 to 100,000 units globally, largely on the uncertainty about improvements to yield and possible delays in large scale manufacturing, both of which limit price competitiveness. In addition, we believed that lack of 4K resolution would hinder adoption as consumers were forced to choose between cheaper 4K LCD TVs and more expensive 1080p OLED TVs for high-end models. 4K OLED production seemed too challenging with acceptable yields near-term given the challenges in producing 1080p OLED.
With an expanded lineup of OLED TVs, including new sizes like 65”and 77”as well as both flat and curved form factors, none of those production concerns seem to be holding the company back from announcing products. LG even announced that the 77”curved 4K (UHD in their parlance) OLED TV would be shipping in June, though no pricing was announced. Let’s just hope the proclamations of impeding availability are not as premature as previous OLED TV announcements.
Why is LG pushing so hard on OLED now, when hyper-competitive 4K LCD pricing had caused a re-evaluation of the time frame for rollout of large-scale OLED TV manufacturing? It could be that LG has concluded that Samsung is more challenged on OLED investment, and sees an opportunity to differentiate. It could also be that LG is further along in its large-scale OLED manufacturing investment, already well underway with its 8G OLED factory. Indeed, a significant breakthrough in higher yields for even 4K models might have LG confident about competitive pricing, as some industry talk at the show suggested. Either way, it is interesting that there were no OLED TV announcements from Samsung today at its press conference.
Both Samsung and LG rolled out “world’s first” 105” curved LCD TVs with “5K” (5120 x 2160 pixels, 21:9 aspect ratio), and both unveiled demonstrations of “bendable” TVs — sets that can be changed from a flat to a curved surface by the user — Samsung with an 85” LCD and LG with a 77” OLED. Samsung was focused on expanding the intersection of 4K (they also use the term UHD, with sets from 50” through 110”) and curved TVs, rolling out curved 4K sets in 55”, 65” and 78.” Finally, Samsung asserted bragging rights for the largest UHD TV, at 110.” However, Vizio announced a 120” UHD set, part of its “Reference Series” which will also feature high dynamic range LED backlights, 10 bit color and high frame rates.