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TV Makers May Need to Slash Holiday Prices

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Old 11-03-2008, 07:15 AM   #1  
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Arrow TV Makers May Need to Slash Holiday Prices

TV Makers May Need to Slash Holiday Prices

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The sagging economy could keep shoppers at home.

By Swanni

Washington, D.C. (November 3, 2008) -- CE retailers and TV makers will likely have to dramatically cut set prices this holiday season to drive uncertain consumers into stores.

That's according to an article in today's New York Times.

The global economic slump could force companies in categories from cars to clothing to slash prices during the next few months. Consumers are nervous that their jobs and economic futures will be jeopardized by a deep recession.

The Times reports that research firm DisplaySearch says the TV sector could see prices cut as low as $400 for a 32-inch LCD HDTV and $600 for a 42-inch Plasma set prior to Black Friday, the traditional opening of the shopping season.

Stan Glasgow, president of Sony Electronics, told The Times that his company won't match those numbers. But he added that they "do not shock me."



DisplaySearch says that the CE industry may already be experiencing a slowdown in sales due to worsening economic conditions. The company told The Times that LCD sales increased 22 percent in September, but that was less than the 28 percent increase reported in August and the 32 percent jump in July.

"People are afraid to spend money," said Stephen Baker, vice president for industry analysis at the NPD Group, which owns DisplaySearch.

Baker added that he does not expect Blu-ray players to fall much lower than $250 this holiday season.

“There is not enough demand for Blu-ray to grow its installed base. Look to Christmas 2009 for aggressive pricing," he said.

Despite Baker's comments, however, many retailers are already selling Blu-ray players for under $200.

Not everyone is buying the sour talk. For instance, Bob Perry, Panasonic’s senior vice president for marketing, told The Times that "we’ve been through wars and national calamities. I just don’t see sales dropping off.”

Some industry officials echo a view offered here at TVPredictions.com on October 20 -- consumers won't stop buying TVs, but they will seek out smaller sets with smaller price tags.
“The momentum was heading toward the 42-inch size, but now that’s off track. That size is the aspirational sweet spot,” one industry official told The Times.
http://www.tvpredictions.com/prices110308.htm
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Old 11-03-2008, 08:07 AM   #2  
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Keep those sales coming!!! I got a wad of cash and I'm ready to spend! YEHAAAAaaaaaaaaa.
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Old 11-03-2008, 08:44 AM   #3  
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If I can get a 42-47" Toshiba/Samsung/Panasonic LCD for around $500-600 then that will be enough slashing for my taste.
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Old 11-03-2008, 12:11 PM   #4  
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I think Stephen Baker from NPD Group needs to do some more research. Best Buy this week is selling a Blu-Ray player for $199 that also includes $100 in Disney Blu-Ray movie coupons. Amazon is selling several BD players for under $250 that also come with four Warner BD movies. And there are rumors everywhere of $149 BD players on Black Friday.

So what would this do to his analysis I wonder? If he was expecting Blu-Ray players to sell no lower than $250 it will most likely throw off all the analysis he did.
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Old 11-03-2008, 12:15 PM   #5  
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Originally Posted by ack_bak View Post
I think Stephen Baker from NPD Group needs to do some more research. Best Buy this week is selling a Blu-Ray player for $199 that also includes $100 in Disney Blu-Ray movie coupons. Amazon is selling several BD players for under $250 that also come with four Warner BD movies. And there are rumors everywhere of $149 BD players on Black Friday.

So what would this do to his analysis I wonder? If he was expecting Blu-Ray players to sell no lower than $250 it will most likely throw off all the analysis he did.
Those Black Friday deals Ack . . .

1. The number of players at the "very low prices" is NOT unlimited.

2. That price is usually for that single day and you have a "drop dead" time - like before 11 AM, etc.

OBTW - Amazon currently has a 42" Panasonic PDP for $783.
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Old 11-03-2008, 12:39 PM   #6  
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I do the ritual of going out at 4am on Black Friday with my wife every year. They always make the best deals with VERY limited quantities available, so you have to be there VERY early (sometimes all night) to even get them. The stores usually hand out tickets for such items to the people in line and they are usually gone by around 4-5am at the latest.

I do agree that part of the logic IS flawed IMO, because $200.00 IS a barrier that changes the equation, and increases the demand below that price.
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Old 11-03-2008, 12:46 PM   #7  
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I do the ritual of going out at 4am on Black Friday with my wife every year. They always make the best deals with VERY limited quantities available, so you have to be there VERY early (sometimes all night) to even get them. The stores usually hand out tickets for such items to the people in line and they are usually gone by around 4-5am at the latest.
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I do agree that part of the logic IS flawed IMO, because $200.00 IS a barrier that changes the equation, and increases the demand below that price.
I have to disagree with this. That price barrier is for a product in demand where people are waiting for the price to drop so they can jump in. I see no evidence of this with BD.

It is not a case of lowering the price to $199 and all of a sudden 100's of thousands of people jump in.
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Old 11-03-2008, 12:47 PM   #8  
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Those Black Friday deals Ack . . .

1. The number of players at the "very low prices" is NOT unlimited.

2. That price is usually for that single day and you have a "drop dead" time - like before 11 AM, etc.

OBTW - Amazon currently has a 42" Panasonic PDP for $783.
I guess you missed the part where there have been numerous Blu-Ray players available for under $250 for sometime now. We are not talking about Black Friday Lee. I am talking about right now.

I can buy a Sony S350 and 4 Warner BD movies for $219 at checkout. (via the $100 off Amazon deal. The S550, Sylvania BD player, S300, and PS3 also apply to the deal).

Right now. That is a 2.0 standalone Sony branded player with 4 Warner movies. So yes. Stephen Baker needs to go back and do his homework. How do we trust the "analysts" that do this for a living when they have no pulse as to what is going on in the real world? BTW. Amazon is keeping this deal going until December 31st (the players may change but the $100 off deal will not).
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Old 11-03-2008, 12:50 PM   #9  
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I guess you missed the part where there have been numerous Blu-Ray players available for under $250 for sometime now. We are not talking about Black Friday Lee. I am talking about right now.

I can buy a Sony S350 and 4 Warner BD movies for $219 at checkout. (via the $100 off Amazon deal. The S550, Sylvania BD player, S300, and PS3 also apply to the deal).

Right now. That is a 2.0 standalone Sony branded player with 4 Warner movies. So yes. Stephen Baker need to go back and do his homework. BTW. Amazon is keeping this deal going until December 31st (the players may change but the $100 off deal will not).
So Ack - how many people do you think are going to take advantage of this deal? 10K? 50K? 100K?

Are they all going to be brand new to the BD format or will existing BD owners jump on that deal also?

It does matter BTW.
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Old 11-03-2008, 12:59 PM   #10  
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So Ack - how many people do you think are going to take advantage of this deal? 10K? 50K? 100K?

Are they all going to be brand new to the BD format or will existing BD owners jump on that deal also?

It does matter BTW.
I don't know how many people will take advantage of the Amazon deal. Clearly many people prefer to buy hardware in a store vs an online dealer, but people are being tighter with their money right now and Amazon is a reputable retailer. Online sales continue to grow year after year. But Lee. It is not just Amazon offering sub $250 BD players. Best Buy, Costco, Sams Club, Wal-mart, Target, etc are all offering sub $250 BD players right now. We are not even talking about holiday discounts that will be upcoming or the bundle deals (buy this 1080p HDTV, get a free BD player). So his analysis is flawed.
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Old 11-03-2008, 01:02 PM   #11  
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Originally Posted by ack_bak View Post
I don't know how many people will take advantage of the Amazon deal. Clearly many people prefer to buy hardware in a store vs an online dealer, but people are being tighter with their money right now and Amazon is a reputable retailer. Online sales continue to grow year after year. But Lee. It is not just Amazon offering sub $250 BD players. Best Buy, Costco, Sams Club, Wal-mart, Target, etc are all offering sub $250 BD players right now. We are not even talking about holiday discounts that will be upcoming or the bundle deals (buy this 1080p HDTV, get a free BD player). So his analysis is flawed.
Sams just went under $200 for the Magnavox player.
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Old 11-03-2008, 01:03 PM   #12  
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Originally Posted by ack_bak View Post
I don't know how many people will take advantage of the Amazon deal. Clearly many people prefer to buy hardware in a store vs an online dealer, but people are being tighter with their money right now and Amazon is a reputable retailer. Online sales continue to grow year after year. But Lee. It is not just Amazon offering sub $250 BD players. Best Buy, Costco, Sams Club, Wal-mart, Target, etc are all offering sub $250 BD players right now. We are not even talking about holiday discounts that will be upcoming or the bundle deals (buy this 1080p HDTV, get a free BD player). So his analysis is flawed.
That was already covered in the article:

Quote:
Baker added that he does not expect Blu-ray players to fall much lower than $250 this holiday season.

“There is not enough demand for Blu-ray to grow its installed base. Look to Christmas 2009 for aggressive pricing," he said.

Despite Baker's comments, however, many retailers are already selling Blu-ray players for under $200.
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Old 11-03-2008, 01:06 PM   #13  
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That was already covered in the article:
I know that. Am I not allowed to talk about it? Isn't that the purpose of posting an article and opening a thread? To discuss it? Or are we only supposed to focus on the part where Baker said that there is not enough demand for Blu-Ray this year?
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Old 11-03-2008, 01:10 PM   #14  
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I know that. Am I not allowed to talk about it? Isn't that the purpose of posting an article and opening a thread? To discuss it? Or are we only supposed to focus on the part where Baker said that there is not enough demand for Blu-Ray this year?
Sure - discuss all you want.

But at least acknowledge that it was brought up in the article already. If it wasn't - then I would understand your stance.

Ack - we have seen so many of these articles haven't we? And yes - I post many of them.

And lately - there seems to be some confusion and spin going on isn't there?

A word to the wise is sufficient . . .

Take them with a grain of salt.
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Old 11-03-2008, 01:15 PM   #15  
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I have to disagree with this. That price barrier is for a product in demand where people are waiting for the price to drop so they can jump in. I see no evidence of this with BD.

It is not a case of lowering the price to $199 and all of a sudden 100's of thousands of people jump in.
Demand of CE products are always changing based on price points. How many Pioneer plasmas were sold at $25,000.00 when it came out? How many are sold at $3,500.00? How many will be sold if the price drops to $1,500.00?

Demand/supply/price are the 3 main ingredients as to whether a product type sells well, so when pricing meets mass consumer pricing levels the critical mass of sales can happen. It is true as we all discussed many times, that BD demand is limited to those with HDTVs so it is more limited than SD DVD now, but at some point most will have some sort of HDTV and that will help demand and diminish this limitation a lot also IMO.

Whether BD ever reaches anywhere even close to SD DVD acceptance levels is unknown and doubtful, but it seems to be moving toward mass adoption at some future point if the remaining issues get resolved IMO. The biggest two remaining issues for me is BD movie pricing, and available titles/releases lagging IMO.
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