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October 16, 2008

Analysts Predict Flat-panel TV Prices Set to Dive

By Jessica Kostek, TMCnet Channel Editor

If high prices have been driving you away from your local Best Buy, worry not. This holiday season a combination of weak consumer spending and a peak in manufacturing capacity will push prices for flat-panel TVs down to unprecedented lows according to analysts.



 
David Barnes, analyst at NPD Group's (News - Alert) DisplaySearch unit, said prices look set to decrease rapidly starting on "Black Friday," the day after Thanksgiving, and lasting through next year.
 
It may be possible for 32-inch LCD TV sets, which now usually cost $600 to $700, will go as low as $350 in stores. That's a huge price slash: “It's close to the long-run average price for a TV in the U.S.,” Barnes said.
 
A foreseeable problem however may be the size, since Americans love everything big, a 32-inch screen may not be impressive enough for those who want a wall-sized cinema. However, Barnes believes that consumers are at the point where the 32-inch set will be the commodity.
 
For those who are dead-set on purchasing a larger 40- or 42-inch set will be glad to know that they too are already dipping below the $1,000 level. 
Barnes' colleague Paul Gagnon said the industry is coming out of a period of rather tight supplies of LCD panels, but more factories are now coming on line.
 
One factor that could boost sales is the impending shutdown of the analog TV broadcasting network in February, which means that older TVs that receive TV over the air will need a converter box. That will drive people to the stores to figure out their options, Gagnon pointed out. New TVs can receive the digital signals that are replacing analog.
 
Nevertheless, because of the failing economy people may not rush to the stores right away.
 
"There's a lot of conflicting pressure on the consumer," Gagnon said. "It will be interesting to see which factor wins out this holiday season."

Jessica Kostek is a channel editor for TMCnet, covering VoIP, CRM, call center and wireless technologies. To read more of Jessica’s articles, please visit her columnist page.

Edited by Jessica Kostek







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