Samsung to Release Bendable TVs in 2014 as Sales Stagnate
Samsung Electronics Co. (005930) outlined plans to sell televisions with bendable screens, introducing sets at a Las Vegas presentation that was marred when Hollywood director Michael Bay walked off stage.
Bay, known for the “Transformers” films, was at the International Consumer Electronics Show with Joseph Stinziano, Samsung’s executive vice president for home entertainment, to help pitch a 105-inch curved, ultra high definition TV. He lost his way with a teleprompter, struggled to go on and then left.
“I got so excited to talk, that I skipped over the exec VP’s intro line and then the teleprompter got lost,” Bay said on his blog. “I guess live shows aren’t my thing.”
Samsung tapped Bay to promote its newest TVs as the Suwon, South Korea-based company combats shrinking sales and stagnating prices by focusing on ultra high definition screens. Samsung also said it would stream games, movies and TV shows straight to its sets, eliminating the need for consoles from Sony Corp. (6758) and Microsoft Corp.
“We plan to release the bendable TV in the market in the second half of this year,” Kim Hyun Suk, executive vice president of Samsung’s TV business, said in an interview. He didn’t elaborate on the price.
Viewers can change the new set’s display from flat to curved by touching a button, Samsung said in statement at CES, where it’s displaying the concept model. Curved screens reduce distortion when watched at an angle and make viewers feel immersed in the picture, manufacturers say.
Samsung also plans to release a TV using the Tizen operating system this year, Kim said without elaborating. Samsung is partnering with Intel Corp. and other technology companies to develop Tizen, which is meant for smartphones, tablets and car systems.
Six of Samsung’s new TVs will feature a curved design, ranging from 55 inches to 110 inches, and will be released in the first half of this year.
Ultra high definition screens, which offer four times the resolution of conventional displays, have struggled to gain traction in the market because of a lack of content for the format and higher prices.
Samsung today posted its first drop in operating profit in nine quarters. Profit in the display division, which makes TVs, probably fell 4 percent, according to a Bloomberg News survey.
The company expects new content deals to spur demand for ultra-HD entertainment through pay-TV operators, Hollywood studios and streaming services. Samsung’s partners include DirecTV, Comcast Corp., Twenty-First Century Fox Inc. (FOXA) and Viacom Inc. (VIAB), along with Netflix Inc. (NFLX), Amazon.com Inc. (AMZN) and M-Go.
The world’s biggest seller of smartphones and TVs will initially offer 20 games on 2014 models with so-called 4K resolution, the company said at CES.
“The content is just going to grow over time,” Stinziano said in an interview. “We have the ability to give the consumer more things that don’t cost more money.”
The Samsung game-streaming sets will be available starting in April, according to the company. People who buy them will use a remote or a USB controller to play a game, said Bill Dickey, a senior manager in the TV division.
The company has struggled to profitably make sets using an emerging display technology that’s slimmer and brighter, so it’s boosting production of less-expensive ultra-HD screens, with 10 models set to debut this year.
While Samsung is focusing on ultra HD to remain competitive with Japanese and Chinese producers, the company remains committed to organic light-emitting diode, or OLED, displays in the long-term, Kim said.
Competitor LG Electronics Inc. (066570), the world’s No. 2 TV maker, today announced its first flexible-screen set using OLED technology. The screen size is 77 inches.
“We are the only player in the market who can possibly mass produce OLED sets,” Skott Ahn, LG’s chief technology officer, said in an interview at CES. “We will take the initiative to bring the price down as fast as we can to an affordable level.”
Global TV demand fell to 226.7 million units last year from 238.2 million the year before, according to IHS. This year, demand will rebound to 229 million units, it said.
“The problem is OLED TVs aren’t convincing enough for consumers to open their wallets,” said Jusy Hong, an analyst at Englewood, Colorado-based researcher IHS Inc. “Until the real flexible displays come into play, the new technology will battle with LCDs at least for the next four-to-five years’ time.”
Worldwide sales of 4K sets, which cost about $2,000 to $20,000, totaled 1.9 million, including 60,000 in the U.S., according to researcher DisplaySearch. Those are expected to rise to 12.7 million and 554,000 this year, respectively.
Samsung, the world’s top TV producer for the past eight years, sees the U.S. and Europe as key markets for new sales this year as economies in both regions recover and demand benefits from events such as the Winter Olympics in the Russian resort of Sochi next month and the World Cup soccer tournament.
“The U.S. economy isn’t expected to be bad, while Europe will also turn for better this year,” Kim said. “The overall TV industry will grow with new technology releases and a lot of upcoming sports events this year.”
Samsung maintained its top position with a 25.5 percent share in the global flat-screen TV market in the third quarter last year, while LG had 14.7 percent and Sony Corp. 7.5 percent, according to DisplaySearch.
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