TV Prices To Fall And Bundled Notebook Deals Will Be Hot

“It’s an interesting time we’re in now. Stock market declines have impacted consumer investments and, in general, consumers aren’t saving very much money, which can impact their purchasing decisions during the upcoming peak buying period,” noted Paul Gagnon, DisplaySearch’s Director of TV Market Research. “To combat this, retailers are expected to pull out all the stops this holiday season—lowering HDTV prices, offering bundled electronic packages with HDTVs and Blu-ray disc players, using ‘creative’ financing deals. Keeping shopper traffic high for the holiday season will be a priority for both retailers and TV manufacturers.”

Gagnon believes there are several potential TV scenarios for the 2008 peak buying period:

Consumers will become increasingly conservative in discretionary holiday spending, despite discount and promotion opportunities—leading to negative Y/Y Q4’08 shipment growth.
Consumers will take advantage of the best bargains and low price points—causing retailers to hit their unit sales targets, but miss revenue goals and negatively impact margins.
Consumers will continue to spend as they have on larger sizes and better featured sets—taking advantage of dramatically lower prices and aggressive retail promotions.
Consumers will turn to discount stores such as Costco and Walmart in greater numbers for electronic purchases this holiday season, in order to save money and get more shopping done in fewer trips.
John Jacobs, DisplaySearch’s Director of Notebook Market Research, shared the company’s outlook for notebook and mini-note PCs over the holidays. Notebook PCs are less impacted by the economy, since they are not an entertainment device, but are more essential to everyday life and have become a communications platform.

DisplaySearch’s notebook PC forecast remains unchanged since late 2007, and the company’s believes traditional December sales will jump in volume, but forecasts conservative shipment growth of 14% Q/Q for Q4’08.

Mini-note PCs (5.0-10.2″) are also forecast to experience huge growth in Q4’08 with a 1650% growth Y/Y to more than 7 million units shipped.

David Barnes, DisplaySearch’s Vice President of Strategic Analysis, noted that TFT LCD manufacturers are reducing fab utilization to avoid oversupply and steep panel price drops. Barnes also highlighted several macroeconomic factors that could affect the flat panel display industry such as 32″ panel commoditization and a reduction in next-generation fab investments.