Panasonic 3-D TVs Sell Out as ‘Avatar’ Technology Reaches Homes
By Kevin Cho, Mariko Yasu and Maki Shiraki
March 17 (Bloomberg) -- Panasonic Corp. said its 3-D TVs sold out in the U.S. in their first week, raising optimism the technology that helped “Avatar” break records at the box office will extend to living rooms and help boost profits.
The shortage is prompting the world’s largest plasma TV maker to take back-orders from retailers, Hitoshi Otsuki, the senior managing director heading Osaka-based Panasonic’s overseas operations, said in an interview yesterday in Tokyo. He declined to specify figures. “It’s a great opportunity to turn around our TV business,” he said.
TV makers are betting movies such as James Cameron’s “Avatar,” the highest-grossing film of all time, and sports events such as the 2010 FIFA World Cup will help drive demand for 3-D sets using improved technology. Still, a lack of programs and the need to use special eyewear, a reason that thwarted previous attempts to push adoption, may deter consumers.
“There are always people who want to buy high-end products,” said Kazuharu Miura, an analyst at Daiwa Securities Capital Markets Co. in Tokyo, said by phone today. “That’s probably what’s driving sales.”
Panasonic became the first major TV maker to sell 3-D sets in the U.S. when its 50-inch full high-definition plasma TV went on sale at outlets of Best Buy Co. with a pair of glasses and a 3-D Blu-ray player for $2,899.99 on March 10. Samsung Electronics Co., the world’s largest TV maker, began offering a 55-inch 3-D model there for $3,299.99 on March 14, while Sony Corp. plans to start selling 3-D Bravia TVs from June.
Unprofitable TV Operations
Samsung hasn’t yet tracked its 3-D TV shipment figures, said Hwang Eun Ju, a spokeswoman at the Suwon, South Korea-based electronics maker.
Panasonic’s TV operations had a loss of more than 10 billion yen ($111 million) in the quarter ended Dec. 31. The business may turn profitable in the year ending March 2011, President Fumio Ohtsubo said March 3.
Panasonic rose 1.7 percent to close at 1,343 yen in Tokyo trading, erasing its loss so far this year. Japan’s benchmark Nikkei 225 Stock Average gained 1.2 percent. Samsung advanced 4.3 percent in Seoul.
“Avatar” in January passed “Titanic” to become the top- grossing movie worldwide and has taken in $2.64 billion since its release, according to Box Office Mojo.
Box Office Winner
Walt Disney Co.’s “Alice in Wonderland,” the Lewis Carroll tale directed by Tim Burton, made $116.1 million in U.S. and Canadian ticket sales on its first weekend, the best opening for a 3-D film and the sixth-biggest debut ever, according to Hollywood.com Box-Office.
The biggest draw to 3-D for customers after the success of movies in the format “will be sport broadcasting,” Otsuki said.
TV makers are counting on 3-D broadcasts of major sporting events to stoke demand. FIFA said in December it agreed with Sony to deliver 3-D images from as many as 25 matches of this year’s soccer World Cup in South Africa.
Disney’s ESPN 3-D will start in June and broadcast 85 live events the first year, the Bristol, Connecticut-based sports network said in January. Discovery Communications Inc., Sony and Imax Corp. announced a venture at the time to introduce a 3-D channel in 2011.
‘Real’ Television
Global shipments of 3-D TVs may reach 4.2 million this year and more than triple to 12.9 million in 2011, according to El Segundo, California-based researcher ISuppli Corp. this month. Revenue from the sets may more than double to $20 billion next year, according to ISuppli.
Samsung has said it aims to sell more than 2 million 3-D TVs this year, while Panasonic expects to sell as many as one million globally in the year starting April 1. LG Electronics Inc. has said it’s targeting sales of 400,000 3-D TV sets in 2010.
“Finally we have real televisions,” Bob Perry, a U.S.- based senior vice president at Panasonic’s audio-visual products marketing unit, said in a March 10 Bloomberg Television interview. “3-D makes TV real.”
Sony, which said last week it plans to sell at least 25 million TVs in the year starting April, predicts sales of 3-D sets will probably account for about 10 percent of the total.
Glasses a Deterrent
“It will probably take a long time for 3-D TVs to expand broadly, maybe about three years” said Ichiro Michikoshi, an analyst at electronics research firm BCN Inc. in Tokyo. “There isn’t enough content and consumers dislike wearing the glasses. Those issues will take time to be solved.”
3-D material has been produced for decades without turning into an enduring success. The world’s first commercial 3-D movie was “The Power of Love” in 1922, according to the Internet Movie Database. The lack of technology and the inconvenience the audience felt while watching the films made the popularity of 3- D short-lived in the 1950s, according to Lee Seung Jin, an analyst at Tong Yang Securities Inc. in Seoul.
Samsung has said improved technologies such as enhanced glasses and better flat-panels with improved picture quality will help viewers watch 3-D TVs more comfortably.
