U.S. Consumer Electronics Prices Lower in January
Mar 17, 2005
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Flat-screen computer monitors and giant plasma TVs led U.S. consumer electronics prices to lower in January, although declines were moderated in the first month after the peak holiday shopping season.
Declines in desktop computers and PC hard drives reflected stronger discounting of devices used more often by companies than by consumers, whose demand drove up DVD players and tape-based digital video cameras. In all, prices dropped just 0.8 percent from December for the most popular consumer electronics goods, according to NPD Consumer Electronics Price Watch.
According to the NPD report, the price for a market basket of the 27 most popular electronics goods fell to U.S. $10,825 in January from December and, were more than $2,500 less than 1 year ago.
NPD Group director of industry analysis Stephen Baker said small and medium business are buying information technology products in January because its the beginning of their fiscal years, when corporate spending curbs typically loosen.
The largest declines were for 42-in plasma screen prices, which slipped 7.2 percent to $2,207, while 17-in LCD monitors fell to $351, down 5.3 percent. Mr. Baker attributed the decline to falling prices for the screens and related parts used to make liquid crystal displays.
"We continue to see pricing at the component level fall and work its way back to the marketplace," he said.
He also noted that January prices for 13 of the 27 products rose from December, defying the notion that consumers can find better bargains in after-Christmas sales.
Indeed, other televisions prices edged higher, with traditional 27-in tube-based TVs up 3.3 percent to $326. Mr. Baker noted that in coming months, retailers will likely scale back advertising and promotions and cut prices as they move in new models and liquidate inventory on older ones.
"(Some items) saw month to month unit declines of over 75 percent (which) allows retailers to raise prices and lower promotions and focus on margin opportunities instead of the unit volume available during the holiday," he said.
Once again, little discounting was seen in prices for 20-gigabyte hard-drive-based portable digital music players, a category dominated by Apple Computer Inc.'s iPod. At $298, prices were down just 0.7 percent from December, but were slightly higher than levels in October, before the start of the holiday season, the NPD report said.
NPD Consumer Electronics Price Watch is compiled by NPD Group, a Port Washington, New York-based market information company, using point-of-sale data from most major U.S. retail stores. The monthly data consist of the total dollar value of the 27 most popular home electronics items and cover changes as consumers start buying different items. (Reuters)
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