IFA 2015: LG Electronics unveils OLED TV expansion strategy
By Keith Liu September 7, 2015
- Launches High Dynamic Range-enabled 4K OLED TV models
- Aims to sell 5 times as many OLED TVs it shifted in 1H 2015
THE market for OLED TVs is heating up and the dominant player in this space, LG Electronics says it aims to make it the new standard in televisions by the end of the year.
Short for Organic Light-Emitting Diode, OLED is a relatively new television display technology that uses individual pixels to light up the screen, rather than an overall display backlight.
This results in deeper blacks and better colour contrast. The display also allows TV designs to be significantly slimmer and lighter.
The downside however, is that OLED TVs are expensive to produce, and not many companies aside from LG have opted to invest in this technology.
At a news conference during the IFA 2015 consumer technology show in Berlin, the CEO of LG’s home entertainment division, Brian Kwon said rising consumer demand and improved panel yield rates will mean lower prices in future.
Referring to the difference between the prices of OLED and LCD TVs, he said, “We could reduce the price gap from the current 50 percent to 20 to 30 percent next year.”
At IFA, the South Korean electronics giant showed off the world’s first High Dynamic Range (HDR) 4K OLED TV, which boasts a thickness of 4.88mm at its slimmest point.
It now plans to incorporate HDR technology in more of its OLED TV portfolio as part of its product strategy.
“HDR is best realized on OLED because OLED delivers perfect black,” Kwon said. HDR is seen as a new generation of content with improved darkness, brightness and shadow details, in a bid to provide a better viewing experience.
As part of its efforts to drive the take-up, it also separately announced a tie-up with Amazon Video to deliver HDR-enabled content to its new televisions, such as Amazon Original Series Transparent.
Unlike previous years when the trend was all about curved screens, LG’s new EF9500 series OLED TVs feature flat displays, while the EG9600 range is curved.
Available in both 55 and 65 inch variants, they are priced at US$5,500 and $7000 respectively.
The larger 77-inch EG9700 model however will cost an eye-watering US$24,000 while at the entry level, a 55-inch Full HD model costs only US$2,500.
All these models also offer higher brightness levels compared to previous versions, allowing them to compete better with current LED displays.
They run on LG’s Smart TV platform powered by the company’s webOS 2.0 software, although according to research firm IDC Asia Pacific, consumers have yet to warm up to smart TVs.
"For now, the high-end 4K or OLED smart TVs are hard to push through in the market as there are many upgrade alternatives like using stick PCs, Chromecast or Apple TV, to use on their existing TVs. It will likely be a choice when consumers' TV are due for replacement," Kenneth Liew, IDC senior analyst said in an email to Digital News Asia.
To that end, LG is hoping to sway consumers to choose OLED TVs through' with a broad marketing strategy to expand its sales of these models, including an expanded product portfolio in the second half featuring different designs and display formats.
In a statement, Kwon said LG aimed to sell five times as many OLED TVs as it did in the first half of 2015.
That would roughly amount to about 300,000 units just within the second half of the year, based on a report from Business Korea, which cites data from DisplaySearch and LG’s quarterly earnings.
The research firm is forecasting the market for OLED TVs to hit 400,000 units in 2015 and will grow to 7 million units in 2019.
DisplaySearch’s report showed LG owned 90 percent of the OLED TV market share during Q1 2015, while Chinese players like Hisense and Konka make up the rest of the market.
A new established player however, has just joined the game.
At IFA, Japanese electronics giant Panasonic showed off its first 4K OLED TV mode, the 65-inch CZ-950, which will go on sale in Europe next month. The price has yet to be announced.
South Korean giant Samsung Electronics is also expected to enter the fray in 2017, according to this report.
To maintain its hold on the market, LG said it will invest in a variety of marketing campaigns to increase international sales with product introduction tours and OLED displays at major airports around the world.
Aside from the consumer home entertainment business, the company also plans to enhance its profitability in the monitor, digital signage and audio-video business through an aggressive push for its high-end monitor products and 4K flat and curved monitors.
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