This week, Panasonic joined the fray of TV manufacturers pushing web-enabled sets as the next big thing. But after widescreen, HDTV and 3D, can “smart TVs” persuade people to upgrade yet again?
PANASONIC UNVEILED its 2012 product range in Hamburg recently, staking its claim on the emerging market for smart TVs that let us access the internet from our living rooms through the biggest screen in the house.
The reinvention of the television continues at pace, seemingly immune to the decline in consumer spending and the plight of manufacturers who have been posting heavy losses as margins decline amidst fierce competition.
Broadband-connected sets are being sold as the next big thing, serving up web content alongside traditional TV entertainment. They have been around for a few years now but the form factor is still evolving as the major players – Panasonic, Philips, Samsung, Sony and LG – continue to push services, more often through a “walled garden” of controlled web content than through a browser.
Consumers are still unlikely to buy a TV based on internet capability, but manufacturers want to catch the wave if it comes. Panasonic’s Viera Connect service offers a web browser on selected sets and preconfigured content on the rest, a mix of games, social networking, catch-up TV, video on-demand and an app store.
The company has been criticised for being late to the internet party, but Keith Evans, managing director for Britain and Ireland, argues that it’s worth the wait. “We tend to think a lot before we get into things and we consider what is the format and technology that will bring the most satisfaction to customers,” he says.
A nice Panasonic feature is seamless connectivity with smartphones and tablets, with a remote app available to switch content from one to the other over Wi-Fi. A “swipe” feature on the new Panasonic smartphone (see panel, below) seamlessly moves the image to the big screen.
Connecting a second screen could be the key to a good TV web-surfing experience, according to Paul Gray, an analyst with DisplaySearch. “With the internet on a TV there is the sheer complexity of navigating an unstructured environment and trying to control it from four meters away,” he says.
DisplaySearch predicts that in 2015, less than 10 per cent of European TV shipments will have unlimited browsing capability. Moving outside the walled garden, you need to be able to input data easily from across the living room. Wireless keyboards feel clunky and smaller remotes too fiddly. There are other ways to do it but they all have their limitations, according to Gray.
Speech recognition involves one person trained to use lots of words or lots of people using a few words, and both need some text-entry at some point. Gesture recognition, like Xbox Kinect, is possible but awkward. Wand-like remote controls with built-in motion sensors offer a less physical interface. “They are all expensive and none have a hands-down advantage,” says Gray.
He is much more enthusiastic about having a companion tablet or smartphone that lets you access the web content before displaying it on the big screen. Such devices can also be used for TV-related apps, emulating the remote control, for example, or running electronic programme guides. “Putting them together gives you more than the sum total of their parts,” says Gray. “Our research says they are likely to become complimentary rather than competing products.”
THE ELEPHANTS IN this particular room are Google and Apple, two masters of repackaging the web into consumable chunks. Each has tried to get a foot in the living room with little success: Google TV was too complicated, Apple TV too restrictive. Rumours abound that Apple will launch a set-based service but Paul Gray is not convinced: “We analyse supply-chain movements, and there is no evidence of a contract for that size for panels.”
He’s not even sure it’s a good fit for the company. “Apple could probably sell two to five million TVs tomorrow, but they like the nexus between high margins and big volumes – that’s very hard in TV, where manufacturers are struggling to make money.”
If Keith Evans fears Apple’s arrival, he’s not letting it show. “It would be good for the industry, because it’s another good brand. And it would be good for us because we wouldn’t be the most expensive anymore,” he quips.
Of the current crop of smart TV manufacturers, Paul Gray says it is too early to predict if there will be an outright winner. Regional differences make it hard to envisage a one-size-fits-all platform that will prevail. The other question is over whether consumers have the appetite to upgrade their televisions yet again. People typically trade up every five years, but Keith Evans expects it to get faster. “Early adopters are changing their TVs every two years,” he claims.
After decades of modest improvement, TV innovation picked up speed 10 years ago when the shift to widescreen was followed by the move from bulky cathode ray tube sets to flat screens. Not since the 1960s and the introduction of colour had TV sets undergone such a radical transformation, but little did we know that it was just the start. High definition was followed by 3D, while incremental improvements continue to make pictures sharper and richer. Web-enabled TVs are the latest chapter.
Panasonic plies its trade at the high end of the consumer electronics market, selling TVs such as the TC-PGT30 plasma, widely acclaimed as among the best on the market. In cash-strapped Ireland, selling premium products has been no obstacle to success, with the head of sales for Ireland, Tony Duggan, claiming 60 per cent growth in the business over the past two years.
While there is no doubt that consumers want bigger screens – 32-inch is now the best seller compared to 21-25-inch a decade ago – it is less clear about the demand for other features. Early confusion about “HD-ready” TV sets may have been resolved, but it’s still a minority of people who regularly watch HD content.
The buzz around 3D sets has been somewhat dulled by a lack of quality content. Hollywood film studios have mostly failed to hit the early benchmark set by Avatar, and it remains a peripheral home-viewing experience despite most sets coming with the feature as standard and Sky launching a dedicated 3D channel.
While Evans acknowledges that inferior 3D films have damaged the format, he refutes the suggestion that it hasn’t lived up to the hype. “I’m not disappointed; it has contributed another feature on most televisions. Cinemas are seeing uplift again and they are making money from it,” he said. “Output is growing. It’s not something you will watch every night of the week; it’s viewing by appointment.”
So will the arrival of smart TV herald a levelling off that will let us hold on to our TVs a little longer? Not a chance. OLED (organic light-emitting diode) screens are on the horizon. The superior screen technology is already appearing on smartphones and tablets but early TV versions are flawed and very expensive, according to Evans. “There is still work to be done, but in the next five years OLED should be commercially available with large screen sizes,” he said.
You have been warned.
