New TVs sharp on value, light on dazzle

San Jose Mercury NewsNovember 25, 2012 

If you’re shopping for a new television this holiday season, you won’t find much in the way of new technology – at least not at prices most people can afford.

But you will find low prices on entry-level TVs – even on jumbo-sized sets. And you’ll also find that when it comes to features, midrange TVs are offering much more bang for the buck than ever before.

“I think consumers will be pleasantly surprised,” said Shawn DuBravac, chief economist of the Consumer Electronics Association, especially if they haven’t “gone out and looked at TVs lately.”

For the past five or six years, a steady stream of new features have made their way into TVs. Higher resolutions and faster refresh rates improved screen images, LED backlights resulted in extra-thin sets, and growing production of ever-larger display sizes gave consumers the chance to buy huge TVs at moderate prices.

But this year, the market is in a lull. The premium features from the past two years – Internet connectivity and 3-D viewing – are becoming standard fare on midrange sets, but nothing is really taking their place.

“We’re sort of in this awkward position”, said Linn Huang, a senior research analyst at IDC, a technology consulting firm. “From a technology standpoint in terms of holidays, you’re not going to see anything groundbreakingly new.”

At least that’s true at the big-box stores where most consumers shop for TVs. Some cutting-edge features – most notably ultrahigh resolution “4K” TVs and TVs based on OLED technology – are starting to make their way into production models. But the numbers of those TVs being produced are so small that they likely won’t show up at your local Best Buy or Costco, Huang said.

And even if they did, the prices on those TVs will put them out of reach for everyone but the most affluent consumers. Sony’s 84-inch 4K TV, for example, is priced at around $25,000.

“Obviously prices will come down, but not enough to be meaningful” in the near term, said Jim Willcox, a senior editor who covers electronics at Consumer Reports.

But if you’re willing to settle for something other than the cutting edge in TV technology, you’re likely to get a good deal. According to NPD Group, a market research firm, the average price of a 50-inch television sold in September was $644. That’s down from $661 in September of last year and well off what consumers would have paid two or three years ago.

But don’t expect prices to continue to drop dramatically on entry-level models, analysts warn.

Prices fell sharply in recent years in part because the Great Recession struck at the same time that TV makers were ramping up production. That left manufacturers, distributors and retailers with an abundance of inventory that they needed to clear out. With the resulting low prices, profits on TV sales are small, and prices can’t get much lower.

This holiday season, “the discounts will be good, but they won’t be (the) exorbitant (discounts) that we saw last holiday season,” Huang said.

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