January 2, 2007 4:00 AM PST

The other guys in digital TV

A few years ago at the Consumer Electronics Show, the big topic of discussion was how Dell and the computing giants were going to change the TV market. Instead, much of the action has come from the elves.

Over the past year or so, a group of small companies--Vizio, Syntax-Brillian, Westinghouse Digital and Polaroid--have gained a greater share of the TV market in the U.S. than the name-brand computer companies. Those brands and others will display their latest models at this year's CES, which starts next week in Las Vegas.

Chalk it up to scrappiness. The small companies have succeeded by undercutting established manufacturers on price while simultaneously building alliances with retailers, contract manufacturers and component suppliers, according to executives and analysts. And costs are kept to a minimum.

"We don't have highly paid executives or fly around on corporate jets. The efficiency of the company is not hiding any kind of latency," said William Wang, CEO of Vizio. "This is how Sony got its start in the TV business several years ago."

In the third quarter, Polaroid was the ninth largest seller in the LCD/plasma TV market in North America, according to DisplaySearch, while Westinghouse was number 11. Vizio held the No. 10 spot overall and was No. 1 in sales of 42-inch LCD TVs, according to the firm.

Syntax-Brillian, not exactly a household name, ranks 13th in the U.S., according to DisplaySearch. But Syntax CEO Vincent Sollitto points out that it's a top three seller in Hong Kong, and a top 10 brand in China. The company recently bought Vivitar, the camera company, and may use Vivitar's brand and channel relationships to break into the European TV market.

"We sell (TVs) at about 20 percent below the tier ones and 20 percent above the tier threes," Sollitto said. In the quarter that ended in September, Syntax garnered $87 million in revenue.

Tuning in
Market share for plasma and LCD TVs in North America, Q3 2006.
Rank Maker %
1 Philips 12.2
2 Samsung 12.0
3 Funai 10.0
4 Panasonic 9.7
5 Sharp 8.4
9 Polaroid 4.3
10 Vizio 4.1
11 Westinghouse 3.6
13 Syntax-Brillian 2.1
20 Dell 0.6
21 Hewlett-Packard 0.6
Source: DisplaySearch

Meanwhile, Dell ranked number 20 in digital TVs in the U.S., and Hewlett-Packard followed up at number 21. Gateway and Motorola, two other big-name companies that got into the TV business earlier in the decade, have bowed out. (Dell, HP and Gateway, though, sell large numbers of LCD monitors for PCs.)

In the worldwide LCD and plasma market, Vizio ranks 10th with a 1.53 percent market share, while Syntax and Westinghouse clock in at 12 and 13. Dell ranks 24th with 0.32 percent of the global market while HP is buried below number 36 in the "other" category, according to iSuppli.

Companies like Samsung, Sony and Panasonic remain the largest TV makers in the world and often command premium prices because of cutting-edge features that haven't trickled down to smaller makers.

Still, the new, small entrants have managed to establish themselves fairly quickly. Vizio started selling TVs under its own brand in 2003. This year, the company will likely pull in $800 million in revenue and ship 800,000 TVs. Just on Black Friday--the traditional blockbuster sales day just after Thanksgiving--Vizio sold between 35,000 and 37,000 TVs, according to the company.

"In a way, they (Vizio) are the poster child of the new TV manufacturer generation," said Bob O'Donnell, an analyst at IDC. "They have done an amazing job of coming from nowhere to play a big role."

The success of the "silver box" manufacturers, as the smaller makers are known, is beginning to rub off on name-brand players, he added. HP for one has begun to price its products more aggressively and add novel features.

How did we get here?
Syntax versus Samsung, of course, wasn't exactly the matchup many expected. Back in 2003 and 2004, PC makers said that they would exploit their brand recognition, expertise in digital electronics and relationships with component suppliers and contract manufacturers to get into TVs. These companies already accounted for a huge chunk of LCD monitors sold worldwide.

Gateway launched an early salvo in 2002 when it came out with a 42-inch plasma TV for $3,000, about half the price of similar TVs from other manufacturers at the time. Sales climbed rapidly.

Executives from consumer electronics companies such as Sony talked about how the PC makers might stumble because of their lack of experience in consumer marketing.

The newly formed entrants were seen as longshots. Like the PC makers, the smaller TV makers planned to rely mostly on contract manufacturers in Taiwan, but most were relatively tiny operations without the buying power or brand cachet of the multinationals. Analysts wondered how these companies could differentiate themselves.

"There's no reason to think the world needs more brands," Barry Young, a senior vice president of DisplaySearch, said in early 2004.

CONTINUED: Cheapest high-end TVs…
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DisplaySearch, Vizio, Polaroid, Westinghouse, digital television

14 comments

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Syntax (Olevia) is a good brand
I got a 27" LCD on Black Friday, 2005 for $600 at Frys. Still performs solid, no complaints.

I read where they found assembly in SoCal was cheaper, so they are moving their USA assembly there.
Posted by okvol (5 comments )
Reply Link Flag
Polaroids
My dad got a Polaroid 32" LCD on sale for $599 from Circuit City! I think that is a pretty darn good deal at this moment in time. The TV itself has a myriad of hookup options on the back. Not the greatest picture but for the price what would you expect. It still looks pretty darn good though!
Posted by reddog00 (2 comments )
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What to do with old TV?
Despite miracle chemistry making indestructible printed circuit boards resistant to all types of corrosion, wouldn't it be perfectly sufficient to sell a black box big enough to convert this all to VHF/UHF PAL/NTSC RGB/VIDEO/divx outputs and be with a biodegradable licence.
Posted by Martin Ozolin (13 comments )
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Westinghouse found the clue
Baught a 32in Westinghouse LCD from BestBuy for Christmas - because of the name and because it was the "best buy" (snicker snicker). After reading this , I am pleasantly surprised to see that is made in Mexico - which is a whole lot more acceptable than God forsaken China. Quality and features comparable to the rest. Go Westinghouse.
Posted by gggg sssss (2285 comments )
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Westinghouse 42" 1080p
I bought a 42" 1080p Westinghouse LCD back in July from Best Buy too for only 1500 compared to tv's almost twice the price. Westinghouse quality is great so far. Think it's better than most on show floor and best price. Happy the little guys are getting bigger. It's good for the industry no matter what sony says.
Posted by jackasssiegel (5 comments )
Link Flag
Westinghouse found the clue: Mexico
hey... greetings from Mexico!. As a mexican, I feel honored by your comment. I feel that things are made with quality in mind, here in my country.

If I knew Westinghouse was putting together their TVs here I would have bought one of them. Instead I bought a 32" LCD Polaroid. It's good, but I think I will be buying a 42" very soon.
Posted by worx3d (1 comment )
Link Flag
word of warning
<a class="jive-link-external" href="http://www.avsforum.com/avs-vb/showthread.php?t=689997" target="_newWindow">http://www.avsforum.com/avs-vb/showthread.php?t=689997</a>

236 pages of threads on a forum, of which many users are complaining about problems with Westinghouse's customer service and RMA.

Personally I've been dealing with Westinghouse since August of 2006 and they have yet to fix the issues with my TV. It's now April of 2007 and I just received the replacement TV this past Thursday. Turns out they damaged it before they shipped it out and I have to send it in again (and likely wait 6 weeks longer). They have the lowest rank on the BBB as well, so I doubt my complaint there will be of any good.

My thoughts are that if you are one of the lucky few to have a fully functioning Westinghouse TV, then you have a fantastic product. With excellent specs and a very crisp, colorful 1080p picture it's a great TV. Unfortunately, if even the slightest thing is wrong with it, expect at least half a year of dealing with customer service to get a replacement.
Posted by GlowingApple (1 comment )
Link Flag
The other guys
I very good run down. I was pleased that it was balanced and fair.

If there are no major PR or quality problems, these other guys are going to give the big guys a run for their money.

Selling solid performance and a great price without the hyped promises is a proven business model.

One only has to look what Hyundai did in the car market to see what is now working in electronics.
Posted by karport (132 comments )
Reply Link Flag
westinghouse
Definitely the way to go. I got the 42" LCD for my office computer. Excellent picture quality. Thumbs up for Westinghouse.


Ash Gilpin
<a class="jive-link-external" href="http://www.ashgilpin.com/archives/64" target="_newWindow">http://www.ashgilpin.com/archives/64</a>
Posted by ashgilpincom (30 comments )
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You get what you pay for IMHO
I wonder if in a few years the owners of these TV's will still be happy with them.
Posted by Ryo Hazuki (378 comments )
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You get what you pay for IMHO
I wonder if in a few years the owners of these TV's will still be happy with them.
Posted by Ryo Hazuki (378 comments )
Reply Link Flag
Congratulations! So you've finally gotten a bigger apartment and can finally afford a nice TV set for your football games and romantic stay-at-home movie dates. Before you write a cheque or swipe your shiny credit card for a nice big TV, you should first check the following list and make sure that you do understand the difference between getting a plasma or LCD TV.
Posted by johnbovi12 (3 comments )
Reply Link Flag
 

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