i3 - May/June 2018 - 44

Business

By Jim Harris

T EC H ST R AT EG I E S

What are the
Top Trends in TV?

 T  

elevision is the most pervasive consumer technology
with 96.5 percent of U.S homes owning a TV. And some
TVs are morphing into massive sets that can bend and
stretch bringing a new dynamic way to view content.
At CES 2018 companies made many
exciting announcements about how TVs
are evolving. LG unveiled the world's first
TV that can be rolled up like paper - a
65-inch Ultra High Definition (UHD)
OLED. Samsung showed off a 146-inch
MicroLED TV that was appropriately
called "The Wall." These two companies,
with roughly 30 percent combined market share, are driving the market. While
both models are futuristic (neither is
commercially available), they show us a
vision of where TVs are going. On one
hand TVs will literally be flexible, and on
the other, they will be HUGE.
For the first time, 4K UHD TVs will
make up half of all total U.S. televisions
sold in 2018, with sales forecast to hit
22 million units (27 percent increase
over 2017) generating $15.9 billion in
revenue (up 14 percent). UHD TVs generate 72 percent of the total category
sales in dollar volume, as they have a
higher average selling price. The growth
of the category is driven by the introduction of next generation features.
UHD TVs are in turn driving the average

4K UHD UNIT SALES
Volume (000s)

LG's OLED TV
tunnel at
CES 2018.

size of TVs larger. In 2009 only 32 percent of TVs sold were larger than
40-inches. In 2018 more than 75 percent
will be, according to CTA market
research. And the average size of TVs will
continue to trend upward as manufacturers are now focussed on sets 55-inches
and larger. In 2018 the 55-59-inch category will sell 9.3 million sets - almost a
quarter of all TVs sold, according to CTA.

Smart TVs on the Rise

TVs are also getting smarter. Two thirds of

SMART TV UNIT SALES

all televisions sold in the U.S. in 2018 will
be smart TVs. A staggering 70 percent of
consumers under the age of 40 stream content (such as Netflix) on their TV using
built-in apps or a device like a Roku. (For
those over 40 years old, the figure is 57 percent.) Because of this shift to streaming
content, the demand for smart TVs is predicted to continue to rise with 96.5 percent
of U.S homes owning a TV. And some TVs
are morphing into massive sets that can
bend and stretch bringing a new dynamic
way to view content.
Netflix now has more U.S. subscribers
than all cable companies combined.
Netflix reached this milestone in quarter
one of 2017 with more than two million
more subscribers than cable. The streaming site has nearly doubled its customers
since 2012, while cable has been unable
to stop a slow decline.
We're also watching TV in a different
way. Seventy percent of Americans
regularly use a second digital device,
typically a smartphone or a laptop, while
watching TV, according to eMarketer.
Called the second screen, viewers engage
in social media (such as during the
Academy Awards), research topics or
actors in the show, or interact with unrelated content while watching.
TVs will continue to stay at the center
of our entertainment experience. But as
social media and online streaming sites
become the cultural norm, we can
expect the way we consume our entertainment to be personalized, easy to use
and interactive. ■

NETFLIX SURPASSES MAJOR CABLE
PROVIDERS IN THE U.S.

Volume (000s)

Number of Netflix subscribers vs. cable pay-TV
subscribers in the U.S. (in millions)

24,992
16,689

26,548

27,286

26,673

28,614

31,922

32,584

29,987

21,119

51.04

2018

2019 2020 2021

Source: CTA Market Research,

Impact of Next-Gen TV on Consumer Behavior
MAY/JUNE 2018

5-YEAR GROWTH: 14%
2016

2017

2018 2019 2020 2021

Source: CTA Market Research,

Impact of Next-Gen TV on Consumer Behavior

20m

49.22

41.40

30m

2017

50.42

40m

5-YEAR GROWTH: 63%

44

52.60

50m

10,488

2016

60m

49.11

46.97

50.85

48.61

35.67

Netflix
Cable

29.17
23.41

10m
0

Q1 2012

Q1 2013

Q1 2014

Q1 2015

Q12016

Q1 2017

Source: Netflix, Leichtman Research Group
I T I S I N N O VAT I O N

David McNew/Getty Images

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