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Is the price reduction of 4K TV forcing 2K TV to gradually exit the market?

2017-05-08

Just as color picture tubes, rear projection, plasma, and LCD TVs have sadly exited the historical stage in the past, 2K TVs are gradually being marginalized in recent years with domestic consumption and technological upgrades, especially the price reduction of 4K TVs and the widespread use of high-definition program sources.

Recently, senior executives from multiple mainstream TV brand manufacturers and channel operators collectively stated that due to the upgrading of domestic consumption and the continuous enrichment of hardware product content, consumers have increasingly higher requirements for image quality. In this situation, high-resolution 4K televisions are becoming widely available, especially in first and second tier cities, and have become the "standard" for purchasing color televisions, while 2K color televisions will gradually exit the market.

The so-called "4K TV" refers to a resolution of 3840 × A 2160 pixel TV has a resolution four times that of a 2K TV, and at this resolution, the viewing experience for consumers is like being in person. With the decrease in upstream 4K panel prices, 4K TVs are entering a rapidly growing era of popularity.

Fan Zhijun, Vice President of Suning Cloud Commerce Group and General Manager of Shanghai Suning, stated that in terms of picture quality, due to the high resolution and strong sense of presence of 4K TVs, and with the efforts of many home appliance manufacturers to promote content, high-quality content also attracts consumers to choose color TV products with better picture quality.

This trend is also reflected in Suning's sales data. Suning's 4K color TV sales accounted for 67% of the total, while in first and second tier cities it accounted for 80%. In the second quarter of this year, the Shanghai market had already reached 82%.

"Judging from our development trend in the first half of the year, the gap advantage that has already opened up between 4K TV and 2K TV in first and second tier cities is expected to further widen in the third quarter. 2K products are gradually withdrawing from the market, especially in physical store channels in first and second tier cities," said Fan Zhijun.

In recent years, major color TV manufacturers have also become familiar with the business philosophy of "picture quality first", constantly innovating and driving the popularization of color TV technology, which has also accelerated the price of 4K color TVs to approach that of 2K TVs.

Recently, Suning joined forces with many mainstream TV brands to launch a "4K price 2K price" initiative, further promoting the comprehensive popularization of high-definition and high-resolution in the industry. From the models launched at the Suning TV Festival, the price of a 55 inch smart TV has dropped below 3000 yuan, and even the price of a 4K TV is inverted compared to that of a 2K TV. Stimulated by the combination of promotional resources from manufacturers, the price of 4K products is lower than that of 2K TVs.

In the view of industry experts, with the widespread adoption of 4K color televisions, 2K color televisions are gradually losing their market competitiveness. Not only are profits low, but market sales are also gradually shrinking. Major color TV manufacturers are also finding it difficult to promote 2K color televisions.

In addition to the increasing popularity of 4K televisions, driven by consumer upgrades and upstream and downstream drivers, the structure of domestic color TV products has also been further upgraded, and large screen color TVs are becoming increasingly mainstream in the market. Data shows that in the first half of this year, the market share of 55 inch smart TVs increased by 10.1% year-on-year, accounting for 21.8%, surpassing 32 inches to become the top mainstream size.

According to Suning's big data, in the first half of 2016, Suning's sales revenue of TVs with a size of 60 inches and above accounted for 23%, a year-on-year increase of 6%. The 65 inch size range also showed signs of explosive growth, indicating that the living room purchasing standards have entered the "6" era.

In the Shanghai market, the trend of large-sized and large screen color TVs is becoming more apparent. "From Suning's sales data, since the second half of last year, the proportion of sales of televisions over 60 inches in Shanghai has reached over 25%, and this trend is even more evident in the second quarter of this year, reaching 35%," said Fan Zhijun.

The increase in the size of color televisions is also closely related to the popularity of smart TVs. Dong Min, General Manager of the Intelligent Display and Digital Entertainment Business Group of Aowei Cloud Network, predicts that the penetration rate of smart TVs in China will increase from 73% to 84% in 2016, which means that almost all of them will be smart TVs except for 32 inches this year.

Experts say that smart TVs have completely changed the functions and layout of televisions. Traditional TVs passively watch programs, but now TVs have become smart terminals in the living room, with interactive applications becoming a major feature. Based on smart devices that integrate video on demand, controller games, sensory games, home theaters, and multi screen interaction in the living room, it is bound to cover all TV products in the future.

Han Jianhua, Secretary General of Shanghai Jiao Jia Jia Association, believes that color televisions have always been a landmark product that attracts attention in the domestic home appliance industry. The current domestic color TV industry is developing towards larger screens, higher definition, and richer content. Among them, the resolution has entered the 4K era. At present, the competition in the domestic color TV industry is basically a competition of "hardware+content", and user consumption habits in the market are also changing. For TV manufacturers and practitioners, it is necessary to pay more attention to customer needs and user experience. (Reporter Gao Shaohua)


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