US LCD TV Prices Jumped 7.2% In July: iSuppli

Jonathan Sutton

One would have thought that in these economically difficult times, the prices of flat-screen HDTVs would have to come down in order to tempt budget-conscious consumers to part with their hard-earned cash. But surprisingly, the price tags of LCD TVs in the United States actually rose in July according to a consumer electronics market research company.

iSuppli, a market analysis and consulting firm with a particular interest in the consumer electronics sector, released a report stating that the average LCD TV retail price in America jumped 7.2% from US $1,060 in June to US $1,136 in July 2010. This not only bucked the trend of consecutive price drops in May and June, but also represented the fastest price acceleration over the past 12 months. On a year-by-year basis, the average US retail price of LCD televisions was also 2.8% higher compared to the same month last year (July 2009) when the figure was US $1,104.

Riddhi Patel, the iSuppli Television Systems & Retail Services division analyst who produced the report, remarked that this year-on-year price hike is rarely seen in the LCD TV arena, simply because stiff competition and ever-dropping costs of LCD panels would most likely cause LCD television prices to decline from one year to next. She gave two plausible reasons for this counter-trend.

Ms Patel suggested that the introduction of more than 20 LCD TV models per size range in July – most sporting new technologies and functionalities – might be responsible for the price surge. LED backlight technology, 3D capabilities, 100Hz/ 200Hz motion, and internet/ wifi/ DLNA connectivities are all exciting features which have enhanced the appeal of LCD TVs, but unfortunately they also add to the price tag.

The second reason cited by Ms Patel is linked the first. To persuade potential buyers to purchase these higher-priced, newer LCD TV sets, retailers decided to reduce the number of promotional deals on older models, thereby contributing to an overall increase in average LCD TV retail pricing.

However, Ms Patel believed that this situation would not last long, predicting that manufacturers and retailers would need to put together some attractive deals with aggressive price cuts to stimulate LCD TV sales which have already showed signs of slowing.