LCD TV Prices to Drop in 2007, Makers Say

BERLIN – LG Electronics and Sharp Corp. said on Thursday they expected prices of flat LCD television sets to drop by 20-30 percent or more in 2007 amid overproduction and cost reductions.

"Last year we saw about 30 percent of price reductions for plasma and a little bit more for LCD. Next year, in 2007, we expect about the same," Young Chan Kim, head of global marketing for LG's displays division told journalists at the IFA consumer electronics show.

Katsuhiko Machida, president of Sharp, said he expected a fall closer to 20 percent on average for LCD TVs. "Some segments may drop 30 percent, others only 15 percent," he told Reuters in an interview. "On average we view 20 percent for the market."

Machida said low-resolution TV sets with screen sizes of 40 inches and above, measured diagonally, might suffer a 30-percent fall in prices.

"But for full-specification, high-resolution sets — due to limited supply compared with demand — we don't see that big a drop," he added.

LG reiterated its goal to become the world's No. 1 display company by 2007. It is currently the second-biggest plasma television producer and the fifth-biggest LCD television set producer, according to market research group DisplaySearch.

LCD and plasma are different flat display technologies, and Kim said he expected the two to co-exist for some time, with plasma targeting the bigger screen sizes of 42 inches and above.

Though plasma TVs of 42 inches were still cheaper than LCD sets, LCD technology was quickly closing the price gap with plasma, he added.

Machida said Sharp expected to regain market share — which it began losing a year ago because it had insufficient capacity to meet demand — from October, when Sharp will start selling LCD TVs made with panels from its new plant in Kameyama, Japan.

"Our global market share is around 10 percent. We want to move to 15 percent. We'll be able to achieve 15 after April next year," he said, adding that Europe, where he expected many people to buy new TVs in the next years, would be crucial.

"People are motivated to change over when the infrastructure changes over from analog to digital," he said, referring to changes in broadcasting standards. "We expect this process to take place between 2007 and 2010."

LG said it would start selling its first Full High Definition (Full HD) LCD television set this year, a 47-inch product, alongside 60 and 70-inch Full HD plasma sets. Smaller and more affordable versions, a 37-inch Full HD LCD set and a 50-inch Full HD plasma set would follow as early as in the first half of 2007.

Full HD sets, with more pixels than "HD-ready" sets that are already on sale, are being announced by the television manufacturing industry at this IFA. They promise to display all the detail of high definition broadcasts.

LG's European president James Kim said LG expects to sell 2 million units of its "chocolate" mobile phone in Europe this year. LG's thin, touch-button slider phone was introduced in Asia last year and in Europe in the spring of 2006. It competes with other designer models like Motorola's (MOT) RAZR, and the high-margin phone is important in LG's attempt to get the world's fifth-biggest phone maker back to profitability.