TV Prices Falling Faster

With the switch the digital sneaking up on us, most people are opting for new TV over the bulky converter boxes. But if anyone is looking to purchase a new fancy TV, you should definitely take a peak at this article. Paul Gagnon of DisplaySearch’s for the North American TV market research has predicted that flat panel TV prices will fall before black Friday (the Friday after Thanksgiving) and continue to for some time till Christmas. He thinks big retailers like Wal-Mart and Cosco will be recipients of theses prices, where they hope people will spend what little extra money they have. Most retailers are afraid previously popular big items like TV's will suffer from the poor ecoenmy durring the holiday season, so their soulution is to lower the prices drastically. So check this out before you make your next big TV purchase.

TV Prices Falling Faster

By Eric A. Taub

If you’re in the market for a new flat panel TV, you may be tempted to get ready to pull out your credit card (if you have any credit left). In the next few weeks, LCD and plasma set prices are due to plummet.

Black Friday, the day after Thanksgiving, has traditionally been the one-day-only super-sales for consumer electronics and the beginning of holiday sales. But this year, prices should tumble even sooner and perhaps stay there.

The reason is obvious: the bear-market economy has caused many consumers to rein in their discretionary spending, and retailers are terrified that sales, especially for big-ticket items like televisions, will evaporate.

Television manufacturers have already lowered their prices, cutting into margins. According to a DisplaySearch conference call held on Friday for its clients, in August the firm projected fourth quarter 2008 sales would climb 1.4 percent from the same period last year, while revenues were to decline 16.3 percent. Now the firm thinks unit sales could decline as well.

The solution: slash TV prices to make them so low that even Crazy Eddie would call them “insane.”

Paul Gagnon, DisplaySearch’s director of North American TV market research, predicts the following prices in the coming weeks:

19-inch high definition LCD: $199
32-inch HD LCD: $399-$499
40-inch 1080p LCD: $799-$999
42-inch HD plasma: $599-$699
50-inch HD plasma: $899-$999

That’s a significant drop from what’s available today. On Costco’s Web site, the least-expensive 32-inch LCD, made by Sceptre, is $599, at least $100 more than DisplaySearch predicts. Its least-expensive 42- inch plasma, a 1080p model from Panasonic, is $899 (with rebate), $200 to $300 more expensive than what’s predicted. At the other end of the spectrum, Best Buy has a 19-inch Dynex-brand LCD, selling at $249, $50 more than what it may cost in a few weeks.

To save cash, customers will most likely go for the stripped-down models, Mr. Gagnon said, devoid of the bells and whistles but still delivering good picture quality. And those sales should disproportionately go to the big box discount stores, like Costco and Wal-Mart, where consumers are now spending more of their money.

To increase profits, look for retailers to pressure customers to buy add-ons, like high-margin extended warranties, Blu-ray players, and custom installation services. But for those customers who are shopping for the lowest price, that could be a very hard sell.

Mr. Gagnon held out the hope that, in the best case, consumers would grab TVs at these once-unthinkable prices, helping retailers survive through what looks to be a bleak Christmas selling season.