ETC Conference Report

2010 TV Ecosystem Conference (Produced by DisplaySearch)

August 18, 2010

San Jose, CA

by Philip Lelyveld

Paul Gagnon, Director of North American TV research, DisplaySearch, spoke about The Future of TV Innovation.  The 3 key innovative technologies emerging this year are 3D, LED backlighting on LCD displays, and internet-connected TVs.

Innovation is a key weapon for combating price erosion.  But the challenge to shifting too aggressively to premium features is that price is by far the dominant consumer criteria when selecting a TV.  92.5% of all TVs sold globally in 2009 were priced below $1,000, with the <$500 price range accounting for over half of those sold.  Displays 34” or smaller dominate the sales statistics.

LED backlit LCD displays are currently selling in small numbers at the very high end of product lines, but by 2014 are expected to make up 80% of the worldwide display market as their price premium falls.

DisplaySearch expects worldwide 3D sales to reach 42.9M units in 2014.  3D TV sales face a number of hurdles, including a perceived content shortage and the need for consumer education.  The price premium for 3D is already falling, Mr. Gagnon reported.

As for connected TVs; the fact that they have internet connectivity changes the way TVs will be used.  Many parties are looking into how to make money in the emerging connected environment.   Whether consumers adopt displays that are dumb devices or smart devices will shape the business models, and determine the winners and losers, in the emerging connected TV ecosystem.

Mike Abary, SVP Home Division, Sony Electronics, said that he expects 3D-ready TVs to constitute 60% of the installed base in the US and 35% in Europe by 2015.  74% of consumers reported their 3D demo experience at Sony Style stores was better than expected.

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Sony is committed to delivering 3D.  Sony has the Sony Technology Center in Culver City, the Sony/CBS 3D Research Center in Las Vegas, and will be working with ESPN, Discover, CBS, and Imax on 3D TV programming and channels.  There are 57 announced 3D theatrical releases through 2012.  There will be 20 3D games for the PS3 by this March.  Sony equipment will be used for over 85 sporting events on ESPN 3D this year.

Eisuke Tsuyuzaki, CTO, Panasonic Corp of North America, said that people move their TVs from their living rooms to other rooms every 8-10 years.  Given that new Panasonic monitors have skype, wireless LAN, IPTV, and 3D capabilities, he questioned whether they could still be called TVs.

Mr. Tsuyuzaki noted that 3D plasma market share is increasing.  Plasma offers wider viewing angles, faster phosphor decay, reduced cross-talk, and simpler eyewear frequency patterns.  Much of his time is spent helping broadcast and cable companies adopt 3D.  Expect a dozen 3D channels by the end of 2011, he said.

David Hsieh, VP Greater China Market, DisplaySearch, described the recent evolution of the TV flat panel component and assembly industry.  Much of the LCD TV manufacturing process is now outsourced to China because that option is more cost effective and able to respond more quickly to market forces.  Westinghouse and Visio outsource almost 100% of their flat panel display production, while Toshiba, Sony, and Philips outsource 30-60% of theirs.

XpanD’s head of gaming and retail, David Checelashvili, reported that XpanD has over 3000 installed theatres in 60 countries on 6 continents. CEA Working Group R4 WG16 is working on emitter standards for active shutter glasses.  XpanD universal 3D glasses contain IR scanning software that activates the appropriate protocol for different 3DTV sets.

Marty Banks, Professor, UC Berkeley, presented his latest research on guidelines for comfortable 3D viewing.  The zone of comfort is shallower for up-close viewing and deeper when viewing at distance.  For greatest long-term viewing comfort, he advised having the viewer sit farther from the screen and keeping the object of primary interest close to the plane of the screen.

Phil Lelyveld, Consumer 3D Experience Lab at the USC ETC, presented the Art, Technology, and Business of 3D: an Entertainment Industry Perspective.  He discussed the importance educating consumers, presenting flexible demonstrations at retail that include movies, games, and sports, and standardizing key elements of the 3D ecosystem.  He also noted that decisions on what data and metadata is created and passed through the digital workflow will impact what features and entertainment experience options that CE device manufacturers can offer to consumers.

John Bayne, Program Director, TV Cover Glass, Corning, described the attributes of a specialty glass that complements 3D display design.  Their Gorilla-brand glass delivers 3D images with minimal cover-induced mura (non-uniform image) and image ghosting (double image).  It is strong, scratch resistant, thin, and light.

Natural Resources Defense Council senior scientist Noah Horowitz reported that CE devices now account for 10-20% of household power consumption, and that new big screen TVs may use more energy than refrigerators.  When manufacturers boost the brightness of 3D displays to counter the light loss in the glasses, they are also boosting power consumption.  The Federal Trade Commission will soon add TVs to its voluntary Energy Guide program; the program that puts yellow labels in refridgerators so consumers can compare annual energy consumption costs.  The FTC exempted display screens larger than 58” for now.

Norm Bogen, VP Digital Entertainment Research, In-Stat reported that over 50% of adults under 40 are frequent viewers of internet TV.

The main barriers to more people adopting internet TV are that they don’t own the required equipment and that they don’t know how to hook it up.

Hybrid broadcast/broadband set top boxes will provide additional monetization opportunities and help maintain existing revenue streams by leveraging Pay TV’s 2-way infrastructure as they include IPTV connectivity and Pay-TV services.

Western Europe dominates the current hybrid STB rollout.  Hybrid STB initiatives include the 70-company European hbbTV.org (www.hbbtv.org/ ), the BBC’s Project Canvas, and Google TV.

The RoxioNow ecosystem was described by Mark Ely, EVP Strategy and Sonic Solutions.  Sonic Solution white labels the ecosystem, so anyone can license it to securely distribute content to multiple platforms.  The solution is similar in concept to Ultraviolet (www.uvvu.com ), and can be Ultraviolet-compliant.  Mark said that their solution is optimized for 3D digital distribution.

YouTube/Google TV group manager Shalini Govil-Pai broke the connected TV landscape down into three categories;  Content, Devices & Infrastructure, and Monetization.

The explosion of Content means that content discovery is a challenge for the consumer.  Google breaks down the discovery problem as a) search vs browse vs social, b) passive vs active, c) custom TV sites, and d) remote control: qwerty vs dpad (digital pad). Google’s YouTube and Leanback are evolving to address these elements.  Content aggregators are appearing on YouTube and are helping coordinate marketing efforts.  They are serving the function previously performed solely by the TV networks.  Google Leanback programs content based on the viewer’s preferences.

For Devices & Infrastructure; traffic discrimination and processing power are key concerns for Google as they develop Google TV.

The ensure that Monetization is more than digital pennies, Google has invested in DoubleClick, AFV (adsense for videos), AFTV (adsense for TV), and PYV (promote your video, where the content itself can be the ad).