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TrendForce Expects Mainstream Sizes of LCD TVs to Grow and 4K Penetration Rate to Rise Significantly to 23.8% This Year

6 April 2016 Display Ricky Lin

Large-size LCD TVs are more affordable than ever and have become the main choice for first-time buyers and families looking to replace their older TV sets. The market for small-size LCD TVs on the other hand is on the wane. “As LCD TVs get larger in size, panel manufacturers in the upstream of the supply chain will capitalize on this trend and expand the size of their panel products to increase the consumption of panel capacity,” said Ricky Lin, research manager for WitsView, a division of TrendForce. “Furthermore, Internet brands in China are offering large-size LCD TVs with high cost-performance (C/P) ratios. These products have been well-received by domestic consumers.”

According to Lin, Chinese brands that target the e-commerce market, such as Xiaomi and LeTV are expanding rapidly in the LCD TV market by promoting high C/P products that are economically priced and multi-functional. The surge of interests around products from Chinese Internet brands have also spurred competitive pricing of large-size TVs, resulting in 65-inch sets getting closer to the pricing sweet spot for most consumers. In China, the market penetration rate of large-size LCD TVs is growing due to vendors’ pricing strategies. In the other regional markets, LeTV is using its investment partnership with compatriot electronics manufacturer TCL to expand its sales channels.

Besides competitive prices, the upgrade in resolution technology is another factor driving the sales of large-size LCD TVs. WitsView estimates that the penetration rate of 4K TVs worldwide will reach 23.8% this year, rising considerably from 13.7% in 2015. Furthermore, the global shipments of 4K TVs for 2016 are forecast to total around 53 million sets. As 4K video content gradually matures and getting more demands, North America is likely to become another fiercely contested market for competing brands this year besides China.

Shipments of LCD TVs sized above 50 inches are expected to grow nearly 40% YoY in 2016 due to the trend towards larger TV sizes

Based on WitsView’s projection, the share of 32-inch products in the combined shipments of the top 15 LCD TV brands will be at 26% this year, showing a 4.7% point drop from last year.

LCD TVs sized 40~45 inches by contrast will see their share in the combined shipments expand to almost 30%, surpassing the 32-inch to become the mainstream size segment in the market.

The market for LCD TVs sized 46 to 50 inches will face constrained growth due to the falling prices of TV sets in the larger, 55-inch segment. The promotional activities for TVs in the 46- to 50-inch size range would therefore become less effective as their price gap with the 55-inch products narrows. Consumers would view TV sets above or below this size range as the more economical choice.

On the whole, the share of large-size products (those sized above 50 inches) in the combined shipments of the 15 LCD TV brands is projected to reach 19.4%. The large-size segments are therefore still the major battlegrounds among vendors, with prices becoming more consumer-friendly. For instance, consumers would be able to buy a 55-inch set this year for about the same price they paid for a 50-inch set last year.

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