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Report: TV Sales Revenue to Fall in 2009, Recover in 2011
Nov 17, 2008
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The consumer electronics and digital TV markets should expect a difficult but by no means catastrophic 2009, according to an IMS Research report. The report is forecasting that, setting aside the U.S. DTV converter box program, that set-top box revenues in the U.S. will decline 5% from 2008 to 2009 and that volumes will actually rise, albeit at a weak 9.3% annual rate over the same period. Globally, IMS Research is forecasting a 2% decline in revenues from 2008 to 2009 on 5% volume growth.

“While the market crisis has made financing an issue for some operators in developing regions, most are still pursuing their digitization strategies, including HD and DVR rollouts that require new set-top boxes,” said Anna Hunt, IMS’ Consumer Electronics Research Director.

Hunt continues, "While many consumers will very likely cut back on their entertainment budgets, TV remains a relatively cheap form of entertainment. Nonetheless, we are expecting ARPU growth to slow or even decline during the period. As a result, set-top suppliers are expecting considerable pressure on pricing in 2009, and low-cost segments such as cable DTA adapters could see considerable growth during the next two years."

However, according to Stephen Froehlich, a senior analyst in IMS’ Consumer Electronics group, "The assumed recession hits the TV set market at a particularly critical juncture, destroying a major profit opportunity for TV manufacturers. By the time the economy recovers in 2010 or 2011 and consumers are willing to buy more expensive sets, the high-performance (120 Hz, high contrast ratio), LCD TV market will be much more commoditized than it is now, removing a major profit opportunity for Samsung, Sony, and other competitors in the luxury TV segment."

IMS Research expects global TV set revenues to be off by 11% in 2009, down to $90 billion from $101 billion in 2008 on a volume decline of just 2%.

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