The Problem with Cheap 4K UHD TVs

Mike Fasulo, Executive Vice President, Sony:

Jay Vandenbree, Senior Vice President, Sales & Marketing, Home Entertainment Group, LG

Rey Roque, Vice President, Marketing, Westinghouse Digital

Henry Hauser, Vice President, Merchandising, Home Entertainment Products, Panasonic

Allan Hsieh, Project Manager, AmTRAN/ JVC:

Tier-one TV makers on who wins and who loses in new TV market

Dealerscope recently talked to the top executives from some of the major TV vendors about how they’re dealing with the most pressing trends in the industry. One trend they’re now facing is the arrival of inexpensive 4K UHD TVs from third- and second-tier manufacturers. We asked them if that poses a threat to their brands and whether the low prices will commoditize the product and cheapen consumer perception of the new technology. For the full interviews, see the July issue of Dealerscope.

Mike Fasulo, Executive Vice President, Sony: I don’t see it as a threat. I see it as a terribly confusing situation for the consumer. I see some of it as irresponsible. From a panel point of view, we learned in high definition the differences in panels, and how cost of entry into LCD was so low because if you had a high-definition panel you could say you were high-definition LCD. One of the core reasons we were not willing to give up on the term 4K was that we have an equity and a history on the professional side of true, native 4K cameras, 4K content acquisition, etc. So when we look at entry into the category, thoseguys who are going to come in and just provide a low-cost panel without theadded value of what you can do with your current content, to me, is irresponsible.
To shortchange the consumer is kind of disappointing. We’re just creating a new market, and already we’re hearing of brands coming out without upscaling, and trying to run a race to the bottom with pricing. Unfortunately, the consumer is going to be the victim in this case, which really bothers me. We emphasize not just the number of pixels but the picture engine that drives those pixels. We have eight million pixels in ours, and we’ll include the number in our specs, but the whole numbers game is not the play here; it’s really the experience.

Jay Vandenbree, Senior Vice President, Sales & Marketing, Home Entertainment Group, LG: I think it poses threats at a couple of levels. The first is that it potentially sets a pricing limitation that there is little value in the R&D and things that go with developing a technology like Ultra HD, and that certainly isn’t the truth. From an industry standpoint, we struggle every day to make sure we can extract the value from our product. For someone to come in and say it’s only worth $1,500, I think that’s a potential issue. Even if it’s successful in terms of people wanting to buy a brand-new technology at a small price, now there’s going to be dissatisfaction with its output – especially in terms of overall picture quality and the 2K-to-4K upconversion. And that is just as bad for the industry, because it says the technology isn’t that good. But when done right, the technology is outstanding. I don’t understand why any retailer would want to support that, because it impacts their ability to be able to garner the value of the product. My opinion is that it’s a miss for a manufacturer wanting to drive that, or for a retailer wanting to support it.
Scott Ramirez, Vice President, Product Marketing & Development, Visual Products, Toshiba: We don’t see those as a threat. The way we look at it is a customer who’s interested in 4K is interested because they appreciate good picture quality. And if that’s the case, once they compare the quality of those OPP (opening-price-point)-type 4K models versus Toshiba, with our CEVO 4K processor, we don’t believe they’d be interested in purchasing that low-cost 4K model, because it just won’t provide the same experience.

Rey Roque, Vice President, Marketing, Westinghouse Digital: The positive is that it drives attention to it. The negative is that consumers need to look at what they’re getting. I’m not implying by any means that a low price-point necessarily means that a particular set has shortcuts, but we have heard that there are products out there that have been rushed to market that are using limited video processing chips and that therefore have to do this upconversion–downconversion. We have looked at some products out there that are doing that, and I’m not sure if those are the lower price-point products. By no means are we going to go that route.

Henry Hauser, Vice President, Merchandising, Home Entertainment Products, Panasonic: It’s been an issue with our industry forever, right? You’re really talking apples and oranges. Unfortunately, a standard hasn’t been established. How do you develop a product you don’t even have content for? Panasonic, being an end-to-end provider with everything from broadcast to consumer, is well aware of what is required of true 4K. We hope some of the dealers will show it responsibly, and in an educational manner. And we say to them, it’s that kind of honesty and direction that will make it future-proof and will give them repeat customers. Obviously, we feel it would have to be demonstrated, so it would have to be sold through a place that has the capability to do that.

Jim Sanduski, Vice President, Strategic Product Marketing, Sharp: It will be that you get what you pay for. There will be, in the 4K area, clearly, a difference in the quality of sets and feature capabilities. So our approach in introducing 4K is to take that high-quality approach.

Allan Hsieh, Project Manager, AmTRAN/ JVC: We’re seeing two different classes of 4K/UHD in the market. There is the class of product we’re seeing today in the market where they’re not really native UHD but are doing more of an upscaling performance. But the other camp is where most of the brands in the market are moving toward: true, native 4K, with the support of H.265. So far, from what we’ve seen in the market, there are a lot of brands out there with UHD, in various price ranges, but we haven’t seen a real plan for the market to have native 4K. That’s what we’re contemplating. When we deliver UHD to the market, our launch plan is to support native 4K.

Related story: Orders Open For Sony 4K Ultra HD Media Player

Editor in chief of Dealerscope
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  • riggarob

    Well, I KNOW why $ony doesn’t want to see the cheap guys come in. Did anyone read the article the other day about what $ony wants to do to the comsumer with this new tech? Should be interesting. I hope the cheap guys screw it all up for the big monopoly guys !

  • bilguana

    How did Westinghouse get into this mix? They have been one of the low-end companies.