Sony’s Glasgow Says 3D Market Will Grow Rapidly Next Three Years

A broad selection of 3D TVs and Blu-ray players will spur the growth, as will Sony’s PS3, which has begun a firmware upgrade to allow playback of 3D content, Glasgow said. A second upgrade will come in the fall, enabling PS3 owners to view 3D Blu-ray titles, he said. About 2.5 million 3D TVs are expected to be sold this year, along with 300,000 notebook and 600,000 and desktop PCs, industry officials said. 3D TV sales will grow to 8.8 million units in 2011 and 27 million by 2013, said Paul Gagnon, director of North American TV research at DisplaySearch.

Glasgow urged that “inferior quality not be allowed to rule the market.” If “we want 3D to succeed, we have to get it right,” he said. Glasgow made no mention of Sony’s use of 2D-to-3D conversion chips in its soon-to-be-introduced Bravia LCD TVs, and he wasn’t available for comment after his speech. Some industry officials have criticized use of the chips, saying they deliver inferior content. Glasgow highlighted Sony’s charter sponsorship of ESPN 3D, which launches June 11. But ESPN has come out strongly against the use of 2D-to-3D conversion chips. Sony also is working with Discovery Communications and Imax on Discovery’s 3D channel, scheduled to start this year.

"If you build the appropriate partners and bring products to market at reasonable prices, you will exceed the adoption rate of not only HD, but any other consumer electronics video device,” said Panasonic Vice President Peter Fannon. “It is very important for all of us to work together to get the best production techniques” to deliver 3D content to homes. Panasonic has 50, 54, 58 and 65 3D plasma TVs and will have additional sizes this year, Fannon said. Panasonic sold out through Best Buy its first batch of 50-inch 3D TVs in March within 10 days of delivering product to the retailer, Fannon said.

In addition to TVs, Sony will introduce 3D digital cameras and Vaio notebook PCs this year as it broadens use of the technology, Glasgow said. Sony’s push is being driven by the arrival 3D movies and by consumer surveys that show 38 percent of consumers “likely” to buy a 3D TV within the next year, he said. About 67 percent of those surveyed said their next TV purchase will be a 3D model, Glasgow said. In driving sales of 3D TVs, “don’t forget how important education will be” since many consumers may not be aware of how “3D of today” is different from what passed for the technology in the past, he said. To limit the potential for confusion among consumers about 3D, the industry needs to set standards, he said.

The 3D market also will be driven by the expanded use of 240 Hz panels needed to deliver the technology and LEDs, industry officials said. The premiums for 40-inch and up LED-backlit sets remain 50 percent or more, Gagnon said. More significantly, in the 32-inch volume business, the premium for an LED models is 15-20 percent, he said. A shortage of LEDs had helped stabilize and in some cases increase prices this year for some sets, Gagnon said. Sales of LED-backlit TVs are expected to rise to 35 million units this year from 5 million in 2009, Gagnon said. While CCFL-based TVs are forecast to sell 145 million units this year, that will decline to about 90 million units 2012 as LED-backlit models hit 110 million, Gagnon said. The price gap between LED- and CCFL-backlit models will shrink over the next three years as retails for LED sets decline 50 percent, said Gary Feather, vice president at Sharp Laboratories of America. LED-backlit sets will hit lower prices as yields improve and up to 10,000 LEDs are produced from a single four-inch wafer, Feather said.

"The costs will continue to steadily decline until this feature is essentially free,” Vizio Vice President Kenneth Lowe said. “2010 is the year of the LED backlight and it is a must-have feature.” While 18 percent of Vizio’s LCD TVs are currently LED backlit, the technology will find its way into 40 percent of the company’s line by year-end, Lowe said.

Sharp also expects to continue to expand use of its Quattron technology that mixes standard red, green and blue with a fourth color, yellow, to bring out more of the picture. The screen also is naturally brighter because of the fourth color since a brighter screen takes less electricity to run. “Several” companies will use the technology in coming years as the technology grows to five or six colors from four, said Bruce Tripido, associate vice president for entertainment products marketing at Sharp.

Internet-capable TVs will eventually dominate the market, Lowe said. About 80 percent of those buying Vizio Internet Apps TV sets connected them to the Internet, he said. And while Vizio based its platform on Yahoo Widgets, the arrival of Sony and Logitech products using Google TV software will further validate the market, Lowe said. While he didn’t mention the Google TV platform directly, Glasgow noted that Sony expects to deliver 3D content via home networks. Vizio will be aggressive in deploying Internet-capable and 3D TVs. It already is fielding a 22-inch LED-backlit set with VIA at $349, Lowe said. And it will have a 55-inch LED direct backlit 3D set containing Vudu and a bluetooth remote that will sell for “something over” $2,000, Lowe said.

Vizio is selling 802.11 b/g/n wireless sets and will field models in the fall with WirelessHD technology. In addition to 22-inch, Vizio also is selling 42, 47 and 55-inch Internet-capable TVs and will “push forward next year so that it will be difficult to buy a non-Internet Vizio TV,” Lowe said. “We fully believe the Internet is a very important feature to the TV.” Sales of Internet-capable TVs are expected to hit 40 million units this year and 70-80 million sets in 2012, Gagnon said.