The circus tent sales pitch begins for 3DTV sets and Blu-ray players

3D television is a hard sell, with little content and higher costs for the newest gear to give you an Avatar-like experience in your home. But retailers and manufacturers are starting that hard sell anyway.
“This is a breakthrough moment, a defining moment for the industry.” Those are strong words, and they’ve probably been said about a great many things, but this week it was Panasonic Consumer Electronic’s Senior Vice President Bob Perry who made the bold statement about the new dimension in television.
Last week, flat panel 3D HDTV sets from Panasonic and Samsung hit the market, and will soon be joined by Sony and other manufacturers. Will customers run to retail outlets to buy HDTVs capable of producing a 3D picture? It’s still early to say, but the feature might not initiate sales on its own.
Panasonic, which will sell its 3D televisions exclusively through Best Buy to start, said it believes it will sell two million units this year. But Best Buy countered it expects cumulative sales from all manufacturers to fall between one million and five million units this year.
The price of a 3D HDTV is comparable to an HDTV without the 3D capability, and therefore purchases may be because retailers will push 3D sets over other models. It’s also possible consumers will be sold on the concept of 3D and see it as an additional feature, which the manufacturers say doesn’t add much to the price of a high-end TV set. Lest anyone think these sets are just about 3D, the retailers stressed the sets do a great job with all TV viewing.
“This TV is a fabulous HDTV all the time,” said Michael Vitelli, Best Buy president. “It’s ready when a customer wants to go.”
Of course, consumers may not be able to tell the difference in quality. A 46-inchVizio non-3D LCD TV sells for $1,028 on Walmart.com. A Samsung 46-inch LED TV with 3D sells for $3,599. The Samsung has much better picture quality, but is it enough to justify that kind of price tag?
Packages seem to be a big push for manufacturers with 3D HDTV sets sold with a 3D Blu-ray disc player and often a pair or two of 3D glasses thrown in as incentive. Samsung will offer a free 3D Starter Kit with two pair of glasses and a copy of the 3D version of the Dreamworks film “Monsters vs. Aliens” on Blu-ray with the purchase of qualifying 3D HDTV sets and 3D Blu-ray players. Panasonic throws in a pair of 3D glasses. Additional pairs of active shutter 3D glasses run about $150 to $200. For a family of four, that means it could cost $600 to $800 for a family night at the movies in a 3D HDTV home.
Market researcher DisplaySearch estimates 3DTV revenues could hit $22 billion by 2018. The company forecasts. DisplaySearch forecasts 3D-ready TVs will grow from 0.2 million units in 2009 to 64 million units in 2018. 3D-ready TV will be the largest application in terms of revenue in 2018 with $17 billion, the company says. And 3-D ready computer monitors will grow from 40,000 in 2009 to 10 million in 2018, when they will constitute 3.6 percent of monitors sold. There are roughly 150 companies participating in the market now.
But the hardest thing will be to sell the first sets. Customer demonstrations seem to be key to raising awareness of the technology. Manufacturers and retailers agree customers have to see 3D in a retail or similar setting, rather than simply reading about it online. Best Buy plans to display its 3D sets, including those from Panasonic, in its Magnolia section at first, and will move displays to its sales floor once adoption picks up. In addition, Panasonic kicked off a 15-city tour featuring demonstrations of its first full HD 3D TVs, 3D gaming, Internet-connected TVs, and LUMIX digital cameras. Cities on the road show include New York, Los Angeles, Chicago, Atlanta, Boston, Dallas, Detroit, and Minneapolis.
Demonstrations are crucial to drive awareness, but only one piece of the equation. Manufacturers are relying on the availability of content to push its sales. Panasonic forged partnerships with DirectTV (which will begin broadcast of three channels in 3D as early as June) and Twentieth Century Fox Home Entertainment. Fox is ready to release “Ice Age: Dawn of the Dinosaurs” next month, its first 3D Blu-ray. Samsung partnered with Dreamworks to support its hardware release with content.
Even with partnerships, content remains a deterrent to adoption. Certain sets from Samsung, Sony, and other manufacturers will convert 2D images into 3D. Panasonic sets will not convert standard and high-definition content to 3D, which limits content new owners have available to a handful of Blu-ray movies and three channels from DirectTV this summer.
Despite the availability of content, sales are expected to be brisk. Panasonic said it believes it will sell two million units this year. Best Buy countered it expects cumulative sales from all manufacturers to fall between one million and five million units this year.
Glasses can be another issue for early adopters. Each 2D HDTV manufacturer uses its own glasses, or that of a third party such as NVidia creating compatibility issues. This means retailers could have difficulty displaying televisions side-by-side for comparisons. Additionally incompatible glasses could cause confusion for consumers who bring home additional 3D glasses. That issue could be addressed by XpandD as early as this summer. XpanD’s X103 universal active 3D glasses will be compatible with any 3D or 3D-ready content. A price is not yet set, but is expected to cost between $125 and $150.
Companies: Panasonic, Samsung, Sony