Hon Hai Precision Industry Co’s (鴻海精密) low-pricing strategy has rapidly increased the exposure of its 60-inch TVs since it began selling the products on Nov. 11, but analysts said it remained to be seen whether demand for such TVs was here to stay or would turn out to be a short-term phenomenon.
During the Taipei leg of the annual IT Month, the large screen TVs grabbed the public’s attention, Taipei Computer Association (台北市電腦公會) project manager Candy Wang (王明玉) said yesterday.
In addition to Hon Hai’s 60-inch models, BenQ Corp (明基) displayed its 55-inch products and Nexgen Mediatech Inc (新視代科技) showed its 84-inch TVs under the Chimei (奇美) brand for public viewing, according to the association which organized the event,
Hon Hai’s 60-inch TV is marketed at NT$38,800 on a contract with telecoms operator Chunghwa Telecom Co (中華電信) or cable TV operator Kbro Co (凱擘), with Chunghwa expecting to sell more than 5,000 units by the end of the year and Kbro projecting to sell 5,000 units by the Lunar New Year holidays in February.
In addition, online shopping portal PChome (網路家庭) on Friday launched an exclusive sale of Tatung Co’s (大同) 55-inch TVs. The product, using Samsung Electronics Co’s flat panels, sells for NT$29,988 per unit, NT$10,011 off the regular price and comes without a contract.
“Slim-screened TVs bigger than 55-inch in size did steal many people’s attention during the show, but people were just examining their display resolution,” Wang said by telephone. “The mainstream slim-screen TVs are still 42-inch models, as most people do not think mega-sized TVs are suitable for their apartments.”
Nancy Liu (劉美君), an analyst at government-supported Industry and Technology Intelligence Services (ITIS), said brand vendors were using the 55-inch and 60-inch products to test consumer interest for large-sized TVs in Taiwan.
“Consumers may be interested in this type of product as companies gear up for promotional activities, but it will take some time before companies will know whether mega-sized TVs can sustain sales momentum in the longer term, considering the current strength of consumer purchasing power,” Radio Taiwan International quoted Liu as saying on Friday.
Nevertheless, Fubon Securities Investment Services Co (富邦投顧) analyst Arthur Liao (廖顯毅) said Hon Hai — which produces TVs for Sharp Corp, Sony Corp, Vizio Inc and Chinese TV brands such as TCL — has made aggressive moves lately in anticipation of an era of mega-sized TVs, including Apple Inc’s iTV.
“The company has continued to grow its TV assembly business in the last few years by acquiring TV manufacturing facilities from its major client, Sony,” Liao said on Friday. “[Hon Hai chairman] Terry Gou’s (郭台銘) personal investment in Sharp’s Sakai LCD plant also reflects the company’s ambitions in the TV market.”
Gou acquired a 37.6 percent stake in Sakai Display Products Corp for ￥49 billion (US$599 million) in July, allowing Hon Hai to secure a stable supply of flat screens from the world’s sole 10th-generation LCD panel plant.
In addition, Sharp was reportedly in talks to sell its overseas TV assembly facilities in China, Mexico and Malaysia to Hon Hai for ￥55 billion, which analysts believe would help Sharp ease its financial pressure while further expanding Hon Hai’s TV business and increasing its chances of winning Apple’s iTV orders.
“Hon Hai’s cooperation with Sharp can improve technology used for large-sized TVs, a possible prerequisite for a future Apple iTV. We believe that Terry Gou decided to invest in Sharp’s Sakai plant because Hon Hai and Apple have reached a consensus over their future product road map,” Liao said in a note.