During the Double 11 shopping festival, the sales of screenless TVs surpassed 200 million yuan, with Hisense TV achieving sales of 1.5 billion yuan and Sharp TV exceeding 2.5 billion yuan. This performance marked a bright spot for the color TV industry after a weak third quarter, as companies anticipated a boost in the fourth quarter through the dual promotional events of Double 11 and Double 12. However, industry analyst Liu Buchen pointed out that while these seasonal promotions could provide temporary market stimulation, they are unlikely to fundamentally change the overall difficult situation of the color TV market.
If the home appliance sector is struggling, the color TV industry is certainly among the worst hit. For example, Skyworth reported a 6.5% year-on-year decline in color TV revenue during the mid-term period, reaching 8.764 billion Hong Kong dollars. Similarly, other domestic TV manufacturers faced challenges during what many describe as a "harsh winter." According to Ovid data, the retail volume of the color TV market fell by 12.9% year-on-year in Q3 2017, reaching 10.41 million units.
The television industry is witnessing signs of restructuring. Companies like LeTV have struggled, and Internet TV has lost some of its momentum. Meanwhile, panel prices began to stabilize in the second half of the year, and the competition between quantum dot (QD) technology and OLED technology gained momentum. As the TV industry evolved in 2017, new trends emerged that signaled promising developments for the coming year.
TV product innovation is on the rise. While OLED technology is being promoted by brands like LG and Skyworth, Samsung, TCL, and Hisense are focusing on quantum dot and laser TVs, aiming to offset the industry's shift toward OLEDs. Despite this, QD TVs have far outperformed OLED models in terms of sales. According to China Yikang monitoring data, during the first week of 2017, QD TVs achieved a retail penetration rate of 4.77%, compared to just 1.22% for OLED TVs. From a technical standpoint, QD TVs hold an advantage.
The display technology landscape in the color TV industry has become more competitive, breaking away from the long-standing issue of homogenous competition seen in the CRT and flat-panel eras. Marketing strategies now emphasize technical innovation to attract consumers, especially in a sluggish market. By highlighting their unique technologies, brands offer more choices and enhance consumer experiences, which can help stimulate market growth. However, despite the apparent progress, there has been no major breakthrough in display technology.
Fan Zhijun, general manager of Shanghai Suning, noted that technological competition has always been a part of the color TV industry’s development. At each stage, different technologies have sparked debates. For instance, early on, the industry debated whether to go with rear projection or large-screen technology, ultimately favoring LCDs. Now, in the post-LCD era, the debate centers around OLED versus QLED. Ultimately, the winner will be determined by consumer preferences.
In contrast to the broader market slowdown, smart TVs have shown steady growth in terms of user retention, activation, and platform value. According to Dr. Li Kefeng, vice president of Jingdong Group, smart TVs accounted for over 87% of shipments in the first half of 2017. By 2018, smart TVs were expected to make up 80% of total TV sales, with large-screen smart TVs already widely used in Chinese households.
Smart TVs are evolving into more than just entertainment devices. With advanced audiovisual capabilities, they are set to integrate features such as gaming, shopping, and even video calling via built-in cameras. As a central hub in the living room, smart TVs are becoming essential for home entertainment. Konka’s executive vice president, Lu Jian, emphasized that the TV is the gateway to the smart home. He stated that if the color TV business fails to secure this position, it may struggle to remain relevant in the future.
While the domestic market remains challenging, international expansion has become a key driver of profitability for many companies. For example, TCL saw a 29.5% year-on-year increase in overseas TV sales in Q3 2017, with a significant 97.4% rise in North America. The company's market share in the region climbed from 10.4% in June to 16.3% by August, placing it third in the market. Skyworth also reported strong international growth, with overseas revenue increasing by 29% year-on-year. Its own brand, Skyworth, saw a 13.1% increase in overseas sales, and it expanded into over ten European countries through its dual-brand strategy with Metz.
Hisense’s acquisition of Toshiba was another step in its global strategy. Prior to this, Hisense had secured a five-year brand license for Sharp in North America, which was due to expire in 2020. The Toshiba brand served as a timely replacement. According to IHS data, Toshiba ranked third in Japanese TV sales in 2016, and after combining with Hisense, their combined market share exceeded 20%.
Analysts at Soochow Securities noted that global TV sales exceed 200 million units annually, with the industry's annual production value surpassing 400 billion yuan. Over the next five to ten years, the total output is expected to reach one trillion yuan. Compared to the shrinking domestic market, foreign markets have become a high-profit area for home appliance companies.
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