Hi-Def Television: ’06 HDTV Sales to Outpace Analog

Oct 31, 2005  •  Post A Comment

Sales of high-definition TV sets in 2006 will for the first time outpace the number of analog sets sold, according to the Consumer Electronics Association, which predicts that retailers will sell 12.1 million analog sets and 16.3 million HD sets next year.

Those numbers are among the factors that the cable industry’s HD enthusiasts point to as evidence that HD has finally reached the tipping point. And they have additional reasons for predicting that HD is about to take off.

Several forces are aligning, said Bryan Burns, ESPN’s VP of strategic planning and business development, one of the industry’s HD evangelists. Set prices are dropping, the number of analog sets sold is slipping, the digital TV tuner mandate requires that new TV sets incrementally have digital tuners and the analog cutoff date means broadcasters will shut off analog signals in either 2008 or 2009, he said. Also, CEA projects that by the end of 2009 more than 100 million HD sets will have been sold.

What’s Coming

There are other factors as well. High-definition DVDs will likely hit the marketplace in 2006, as will HD-capable versions of Microsoft’s Xbox and Sony’s PlayStation consoles. ESPN just signed a 15-year deal with Electronic Arts to create ESPN-branded games in HD. Even ABC’s “Good Morning America” is going HD.

“This is the on-ramp to the whole process of switching to HD,” Mr. Burns said.

As consumers buy big sets to view the HD pictures, the new HD set usually becomes the primary TV in the home. By the end of 2009 about 75 percent of homes will own an HDTV and most of the viewing will be on it, CEA predicts.

ESPN has also done its part to add to the industry’s growth statistics. ESPNHD and ESPN2HD announced last week that they will offer 24 of 25 college football bowl games in HD this season. In 2006 the networks will offer more than 600 telecasts in HD, up from 468 this year. More than 250 of next year’s HD telecasts will be on ESPN2HD, which rolled out this year.

“We’re feeding [ESPN2HD] more strongly than we fed ESPNHD in its second year. The two are now programmed and designed to work together,” Mr. Burns said.

The availability of content in HD should no longer be an issue that gives consumers pause before an HD purchase, Mr. Burns said. Today’s existing HD networks will be joined next year by entrants from Scripps Networks, MTV Networks and an HD simulcast of National Geographic Channel.

Other forces will push HD penetration, too, said Ron Lamprecht, VP of new media for NBC Universal Cable, which last week made a deal to distribute its Universal HD network on Time Warner Cable.

That agreement is one of many that are likely to be sealed industrywide in the coming months. Cable continues to bolster its HD lineup, DirecTV will make its big HD push into local channels later this year and telephone companies will fire up HD services with their video launches next year, Mr. Lamprecht said. “All three groups will be equally interested in driving interest in HD,” he said.

Those distributors in turn are vying for consumers’ attention, said John Ford, executive VP of programming for National Geographic Channel. “HD is a competitive advantage, which is why DirecTV is launching new satellites to add to its HD capacity,” he said.

Technology is improving, too, so that more pictures can be sent using less bandwidth, he said.

Those factors could translate into a very merry holiday shopping season for electronics retailers.