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Report: Ultra HD pricing prohibitive for years

Fri, 01/04/2013 - 2:18pm
Brian Santo

Ultra-high-definition (Ultra HD) television sets are likely to remain far too expensive to merit more than a few million sales in the next few years, though adoption rates are likely to accelerate starting in 2016, according to a new report by Strategy Analytics.

The predictions are in accord with pay-TV industry expectations; few anticipate that Ultra HD will be much of a concern in the next few years.

Samsung, Sony and LG are planning to introduce new Ultra HD TVs at CES, probably priced at more than $10,000.

Strategy Analytics calls these TVs UHD TVs. They are also often called 4K TVs, a reference to their horizontal pixel count.

“Current pricing makes UHD TVs more or less unaffordable, but TV manufacturers are expected to make significant production investments in the medium term, and we anticipate UHD TV prices will fall to the sub-$2,000 range within the next five years,” said Jia Wu, director of the research firm’s Connected Home Devices service. “Once retail prices hit this sweet spot, sales in the United States, Germany, United Kingdom, Japan, China and other markets will quickly take off.”

The report predicts that global annual sales of Ultra HDTVs will first break through the 1 million barrier in 2015, though by 2020, global annual sales will exceed 50 million units.

Strategy Analytics expects the Ultra HD market will be dominated by jumbo-size displays of 60 to 100 inches or more; 80-inch and over displays will account for 26 percent of global sales in 2020, and 60- to 79-inch displays will account for 61 percent.

David Mercer, vice president and principal analyst at Strategy Analytics, added: “TV manufacturers will drive UHD TV adoption in the early years, and the growing installed base of UHD-ready displays will eventually encourage content and service providers to deliver UHD-quality sports, movies and TV shows to premium pay-TV subscribers. Internet-sourced UHD video is also a possibility but could raise significant challenges in broadband bandwidth and download limits.”

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