After years of growth it appears that market saturation has bitten in to the TV market, with shipment growth at its lowest in years.
In 2011 worldwide shipments for TVs fell for the first time since DisplaySearch began tracking them back in 2004, with successive years of growth coming to a halt.
While there were various reasons behind a slowing in growth, most prominent is the lack of demand for LCDs, particularly in mature regions.
Japan may have been affected by the stopping of a government backed EcoPoints project, but growth in developed markets generally showed signs of tailing off.
Although LCD TV shipments were up by seven percent in 2011 to 205 million units, this was still less than the double-digit growth that has become the norm. In the fourth quarter, shipments increased by just one percent.
Although this is partially due to increased inventories, the proliferation of flatscreen sets in places such as the UK and US has taken its toll.
Furthermore, the growth for LCD TV shipments was not enough to keep the overall market up, with continued drops in other TV types. For example, plasma TV shipments declined 7 percent to 17.2 million units, while the continued replacement of CRT sets meant a 34 percent fall.
With reduced growth in the LCD market this meant that the overall TV shipments were down by 0.3 percent to 247.7 million units.
Shipments in emerging regions were strong in the fourth quarter, rising 12 percent year on year, with LCD TVs growing to account for 20 percent of shipments. In North America, Japan and Western Europe Q4 shipments were down by 21 percent.
3D shipments increased to 14 percent of all global shipments. Strangely, according to DisplaySearch analyst Paul Gray, in the US 3D shipments accounted for just nine percent of the market, despite relatively good access to 3D content, while Western Europe saw 3D sets account for 21 percent of shipments despite a paucity.
According to Gray, the results of the report show that the days of massive growth figures in areas such as Western Europe or North America are likely behind us, with markets becoming saturated with LCDs.
“In mature markets anybody who really wants a flat TV already has one – it is now a discretionary purchase,” he told TechEye. “It is the end of the glory years when it was a hot new category.”
Gray said the economy right now doesn’t help. “Consumers have to be enticed by all sorts of deals,” he said. “It is just a return to the everyday reality of it being a mature replacement market.”
According to Gray, consumers in developed markets are now generally in replacement cycles and are looking to spend their cash on other products.
“Maybe last year the industry managed to defy gravity one last time, but in the end people tend to buy TVs and then replace them every seven or eight years,” he said. “The TV market, in the end, will track the number of households – and the population is not growing in Europe.
“The underlying story behind all this is that you had five years where the TV has been at the top of the list of what people would pay 500 quid on. Now people are saying they would rather have a tablet or a laptop – the TV is not at the top of the list as it has been in the past few years.”