2019 TV Roundtable: Is the Market Ready for 8K?
Dealerscope: What are your brand’s short- and long-term strategies for the introduction of 8K TV sets in the U.S.?
Rick Calacci, Senior Vice President, Home Entertainment Sales, LG Electronics USA: In the short term, CES is the U.S. launchpad for the world’s first 8K UHD OLED TV, a stunning new 88-inch model. We’re introducing an 8K LCD TV this year, too, both with 16 times the resolution of Full HD. For the foreseeable future, 8K will be a super-premium, ultra-large-screen category.
Mike Fasulo, COO and President, Sony Corp. of North America: As a leader in the CE/TV industry, Sony is always supporting and leading new technologies that address our customers’ needs. We will continue to drive the premium TV market forward, whether it be upscaling 2K, native 4K, or future 8K technologies. Sony is focused on delivering the best consumer experience, quality, and choice to the customer. Sony did demonstrate 8K at CES 2018 and garnered great reviews on the stellar visual performance.
David Gold, Vice President of Consumer Electronics, Hisense: We believe in pushing the boundaries of innovation and introducing the future of TV to consumers. Hisense was definitively on the forefront of 4K TV, commercially launching product in 2014. Our 8K TV technology is in-house now and has been for some time. Choosing the right time to introduce our products is important.
We realize there is an important equation to be considered when shopping for a TV: a commensurate balance between price and the best entertainment experience.
For most consumers, broadcast infrastructure investments will lag behind display technology availability. The industry’s entire signal chain will need to be upgraded once again. Studio recording and transmission equipment, Internet/broadband streaming services and content providers must all be in sync to deliver a real 8K viewing experience.
So, long term, Hisense will naturally be out front again, increasing consumer choice and demonstrating the endless possibilities of TV – the future is attainable today and that should embolden consumers to embrace new technologies. The Hisense 8K TV product line will be front and center at the perfect moment.
Brett Hunt, Vice President, Sales & Marketing, Westinghouse Electronics: We are currently assessing the demand for 8K TVs and will look to produce when pricing make sense for our target customers.
Chris Larson, Senior Vice President, North America, TCL: TCL has a simple strategy when looking at any technology. We do not introduce technology for technology’s sake. We try to understand what benefits our users might derive from innovation, and the best way to deliver that to them. Additional resolution certainly has its benefits, particularly as screen sizes increase. However, there are still challenges with content availability as well as source devices (and the connections between them) that we need to overcome. We want to ensure that we are delivering a product that will delight our users for many years to come, and not frustrate them with dead-ends.
With the opening of our Gen 11 panel fab in early 2019, TCL will be aggressively attacking the large-screen space and we can expect 8K to be part of that, as we solve some of the challenges around it. Longer term, I expect that this additional resolution will become standard on sets that can benefit from the increased resolution, much like UHD has become standard on anything over 49 inches.
Andrew Sivori, Vice President of TV Product Marketing, Samsung: As with the introduction of any new technology, or in this case, resolution, into the marketplace, there needs to be a foundation established before it can grow. As was the case at the inception of 4K, there is little incentive for content creators to invest in producing 8K content unless there are 8K televisions in the marketplace that can display it. By being the first to market with a commercially available 8K TV in the U.S., we are laying the groundwork for 8K content creators while offering consumers the ability to experience the best and highest resolution content as it becomes available.
In the short term, our 8K TVs feature highly advanced AI upscaling capabilities that can not only upscale content in lower resolutions – regardless if it is 480p or 4K – but also improve the overall image quality in ways never before possible. Though “upscaling” has been available for some time, it has been limited in capability, and often introduced undesired effects. Not so, with Samsung’s AI Upscaling technology – consumers can enjoy all of the lower-resolution content upscaled, without the artifacts and trade-offs normally associated with traditional upscaling. So as the native 8K ecosystem is established, consumers can enjoy beautifully upscaled performance from existing content today.
Through 2018, CTA has estimated that market penetration of 4K sets in the U.S. will have reached about one in three households. Now, 8K sets are coming, along with the new year. With 8K introductions occurring beginning in 2019, and with 4K penetration still below 50 percent, how do you think that scenario will affect the adoption curve of 4K sets – if you think it will, at all? Might it speed up 4K adoption or chill it?
Fasulo: We expect initial 8K TV sales to begin at the very high end, very-large-screen portion of the market, at a lower sales volume. This should not have a great effect on the 4K UHD adoption curve, which we foresee continuing in 2019. Furthermore, the industry continues to produce even more 4K, thereby accelerating 4K use.
Calacci: More than half of all TVs sold in 2019 will be 4K UHD sets, including virtually all TVs above 50 inches. I actually think 8K will help drive more 4K sales as consumers recognize the tremendous performance and value of large-screen 4K UHD TVs.
Sivori: When it comes to deciding what TV to buy, our research shows that size and resolution help consumers decide which TV to buy. Typically, the new, larger and higher-performing TV is centrally located in the home and the older TVs are moved from the living room to a secondary room such as a bedroom or basement. On the other hand, pricing has determined when consumers buy a TV. As 4K adoption has grown, pricing has improved for the consumer. We anticipate this trend will continue to drive adoption growth for 4K while 8K will become the premium, main TV in the home in the near future.
Hunt: The adoption of 4K sets have greatly increased over the last few years largely due to the phasing out of 1080p TVs in the larger screen sizes. Adoption will continue to grow as the price differences between HDTV and UHDTV become even closer. Eventually, consumers will only have the option to purchase 4K UHDTV sets at 43 inches and above. High-definition TVs will still have a stronghold on the smaller-sized screens. In my opinion, the introduction of 8K TVs will have not have a noticeable affect on UHDTV adoption in the first year of product introduction.
Larson: We do not see an impact to 4K if we (manufacturers and retailers) keep the focus on the consumers and the benefits of increased resolution. Just like HD and FHD still exist for smaller screen sizes where the benefits do not clearly outweigh the costs, we believe you will see 8K growth focused where it does the most good: in 65-inch-and-larger sets. In these jumbo screen sizes, the additional pixel density can be a clear benefit and the cost delta much more manageable.
Gold: In short, 8K sets will speed up adoption of 4K sets.
There are a couple of factors at play here. As a new display technology lacking both unit volume and content, 8K TV will present an intriguing but expensive option for consumers. We know that one of the top drivers of the consumer purchase decision for TV is price. 8K sets available early in 2019 will be expensive, even for early adopters. But with just a couple of questions, consumers will understand that they will need to wait for broadcast, content and streaming infrastructure to catch up. These two reasons combined will somewhat limit 8K penetration in 2019. At the same time, 8K will demonstrate the staggering picture quality that is possible on even the largest screen sizes in the market.
The presence and availability of 8K TV will continue to challenge manufacturers and retailers to find the best way to educate consumers. In the process, penetration of 4K will continue to rise, as it will appear to be the reasonable choice for the best balance of content and value.
What are your total market projections for industry sales of 8K sets for all of 2019? And do those projections eclipse what you had expected for the first year of 4K TV sales when they started selling?
Fasulo: While taking UHD to the next level for the largest of screens (70 inches and above), 8K UHD TVs are still in their infancy. Sony will continue to focus on delivering the best customer experience and picture quality for any type of TV content.
Calacci: It’s really too early to say except that volume will be tiny in the first year, not unlike the initial launch of 4K UHD when LG introduced the first TVs priced at over $25,000. Over time, they’ll become more affordable, but the delta between 8K and 4K is expected to be significant for some time, and 8K is likely to only be used in sets 65-inch and above for the foreseeable future.
Sivori: We’ve seen strong demand for our first flagship 8K model, which was introduced into the marketplace a short time ago. Driving much of that demand has been our unique approach to 8K – offering consumers the benefit of 8K resolution through our AI upscaling capability. Consumers don’t need to wait until native 8K content is available in order to enjoy the incredible picture quality our upscaling solution provides. This is a key difference between the introduction of 4K and the direction we are taking today with 8K
Gold: The display panel industry is expecting very low single-digit penetration rates for the next couple years. First year out, 8K set sales will be lower than first year of 4K set sales.
Larson: Because the benefits are focused on very-large screen sizes, we expect the unit growth of 8K to be slower than 4K. The most demonstrable aspects of the increased resolution come with very-large-sized sets, and while that market is growing – it is still not the same addressable market size as a 50- or 55-inch television.
Hunt: No plans as of today to sell 8K sets in 2019.
Whether or not your brand expects to be a participant in the 8K introduction first wave, what do you think consumers’ perceptions are likely to be, when confronted with 8K on the retail sales floor? And if you are marketing 8K in that first wave, what helps are you offering retailers to alleviate showroom floor confusion, and explain the long-term benefits and differences (since content availability won’t be a factor at first)?
Hunt: I think adoption of 8K will be tough in the early years, especially with sales of 4K just really ramping up. Plus the lack of 8K content will keep the adoption rate low. I think you are going to see a similar pattern to what we saw in the adoption of 4K by consumers, and maybe even slower. Content availability and pricing will drive sales.
Gold: Hisense will continue to be a technology leader and will be in the first wave of 8K TV. Our 8K 75-inch will be on display in January at CES.
We believe retailers will have three primary challenges as related to 8K TV, and we plan to provide collaborative solutions for our key channel partners.
Number One: Content and in-store display. It is likely that media players dedicated to distributed 8K TV signals will have to be utilized for a retailer to perform A/B comparisons on the sales floor. Additionally, an 8K demonstration video can reside within the TV, accessible through the menu system.
Number Two: Sales staff training. Hisense will remain dedicated to training our channel partners and consumers alike. To this end, we just recently added staff with proven success and additional training resources to our marketing team.
Number Three: Responsible selling. An “ultimate entertainment experience” and “future-proofing” retail sales pitch may be effective when it comes to presenting 8K TV, but it is ultimately the job of the retail sales associate to ensure consumers understand how much content may or may not be available to them at the time of their purchase. The right approach to this will help to avoid buyer’s remorse and expensive returns. Again, Hisense intends to partner with our retailers through training.
Calacci: Leading technology companies like LG – in our case with industry-leading displays and the most advanced upscaling technology – will wow consumers with the in-store 8K experience. The fact is though, while it will look cool, the market is very limited initially. That’s why we think the vast majority of shoppers, even premium consumers, will continue to embrace 4K for some time. It’s important to note that native 4K content is still a very small percentage of our daily viewing; 8K content is a ways off still.
Sivori: Unlike differences in panel technologies, 8K offers a clear and easy-to-communicate benefit to consumers. 8K is double the resolution of 4K, and our Q900 offers upscaled, lifelike picture quality regardless of the native resolution of the content. Consumers will be blown away when they see images that are lower resolution, upscaled to 8K without the tradeoffs typically associated with traditional upscaling. We are providing demonstration content for selling floors that clearly highlight the improvement in picture quality made possible by our AI Upscaling solution. Consumers will be able to see with their very own eyes – crisp, clear SD, HD and even UHD content delivered in stunning 8K resolution - without all of the artifacts.
Speaking in general about your premium-level TVs, both 8K and 4K, name one or two points about your company’s top 2019 TV offerings that are easy for a sales floor associate to communicate (including any that have to do with sound quality).
Fasulo: Sony is uniquely positioned to deliver the creator’s intent and a premium customer experience because we manufacture the 4K and 8K professional cameras used for TV and movie production, we have the studios which produce and acquire the content, the industry uses Sony industry-reference TV monitors for professional post-production color grading, and we participate in the distribution of the final content to the customer’s home.
A television’s processor plays a key role in delivering a high-quality picture and is all the more important on an 8K television. Sony’s newly developed, next-generation Picture Processor X1 Ultimate was first shown as part of an 8K prototype TV at CES 2018 and is now shipping with our A9F OLED and Z9F LED MASTER Series TVs. Precision in signal processing, whether upscaling 2K, current 4K, or future 8K content, results in a premium viewing experience.
Sivori: Samsung offers clear steps in our premium lineup. Our 4K QLED lineup combines striking advances in Quantum Dot technology and 4K picture quality with cutting-edge lifestyle features. Delivering incredible brightness and lifelike colors plus features like our award-winning Ambient Mode, our QLED TVs stand out when on and blend into any living space when off.
By offering a larger 85-inch 8K QLED flagship model, we offer consumers the option to step up to stunning 8K resolution by adding upscaling technology that takes SD, HD and even UHD content up to 8K for the ultimate combination of resolution, color and brightness available today.
Calacci: For LG this year, it’s all about picture quality and AI (artificial intelligence). For 2019, we’re taking the home entertainment experience to the next level, combining the industry’s best display technology, LG OLED, with new AI advances that make the TV your smart home hub. Dealer interest also is very strong in our 2019 LCD/LED Super UHD TVs that also feature ThinQ AI.
Hunt: In 2018, we introduced our new line of Smart 4K Ultra HDTVs utilizing the Android TV platform. Equipped with Google Assistant, Westinghouse 4K Ultra HD TVs with Android TV make it easy to quickly find the latest blockbuster movies, browse and discover new content, check game scores in real-time and control smart home devices including connected LED light bulbs, light switches, thermostats and more.
Larson: Resolution (HD / FHD / UHD / 8K) is only one part of what makes a television a great experience for the consumer. TCL is focused on improving simplicity of use, access to all of your content, and picture quality that simply stuns. We try to ensure that EVERY set we offer provides those benefits. Our premium sets will provide more contrast, more color, and better management of all these elements to create an unmatched experience.
Gold: We’re excited to expand our ULED capabilities into at least three of our series of TVs in 2019. Our exclusive ULED (UltraLED) technologies including the Hi-View chip will drive PQ enhancing algorithms that boost color, contrast, brightness and motion. All are calibrated to work together in perfect harmony—to upgrade the performance of every pixel and a picture to deliver an impeccable viewing experience. Additionally, our premium-level TVs will include quantum dot technology with even brighter, more saturated, more accurate colors.
Also in 2019, we’re poised for continued growth with our laser TV product line of short-throw projectors. We’ll continue pushing our WCG model well into 2019 along with a new unit that will appear in market later in 2019.
From an audio perspective, we’ve partnered with the best audio engineers from Dolby, dbx, and Harman Kardon that will have consumers second-guessing the need of purchasing a soundbar – our native audio capabilities are a key differentiator.
Are there any other topics/issues relating to 2019 TV sales or technology that retailers should be aware of moving through the year?
Sivori: We’ve done extensive research on how consumers use and watch their TVs, and we’ve found that typical consumers don’t watch TV in totally dark rooms. They value lifelike color accuracy, brightness and contrast – the combination of these elements that deliver the best overall picture. In addition to picture quality, they also value elements such as innovative design that allow the TV to blend into living spaces and make their interacting with the TV easier. This is the secret to the success of our QLED lineup – delivering what consumers want - a powerful, versatile TV that meets every need. In 2019, we see consumers looking at the overall experience a TV provides as being a major part of their purchase decision.
Gold: We really believe that the introduction of AI in the optimization of picture and audio quality will be imperative to changing the TV viewing experience in 2019. AI delivers intelligent picture and audio quality by using algorithms to ensure the optimal viewing and listening experience. This incredibly smart feature continually and intuitively adjusts the areas that matter most to create amazing video and sound. We’ve included this functionality in our H8, U9 and H9F series.