MCG Reports
The Impact of DTV on Television and Computer Displays
(Technology and Demand Forecast for the North American Market)
by Charles McLaughlin | chuck@mcgweb.com | Telephone: 650 323 7155
and Ron Cooke | research@wizwire.com| 530 269 3804
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"Although the FCC's DTV broadcasting ruling can be regarded as a "trigger event"
that forced the digital era on the entertainment industry, the real long term
force behind DTV is the Internet.""HDTV is a side show. And forget the acronyms- HDTV, EDTV, SDTV.
What the consumer will receive is more choices of higher quality video
in a 16:9 format and an improved audio experience. That's about it."Eventually, the computer industry will have to adopt the
16:9 format for all of its monitor products.""The computer industry should position itself to develop, manufacture, install and
- where appropriate- manage the digital systems of the entertainment industry,
including set top boxes and televisions. Thus far, however, the industry lacks
the comprehension, leadership and organization to accomplish this goal.
SCOPE
The transition to Digital Television (DTV) technology, along with the continued explosive growth of internet multimedia content, will have a dramatic impact on electronic display requirements. This study defines the feature, performance and price requirements for a new generation of television and personal computer displays. It further traces the impact that emerging display technology will have on the display market.
The study develops an integrated forecast for consumer and enterprise DTV display demand in the North America. Key trends in the emerging markets for DTV, Internet multimedia content, and Interactive TV services are used to build a forecast of demand by display segment and technology.
Detailed requirements for screen size, definition, brightness, color, and aspect ratio are developed for each product category. Competitive positioning of both CRT, flat panel, and projection technology displays is examined by market and product segment.
METHODOLOGY
MCG conducted over 150 person to person interviews with key personnel from the retail, telecommunications, entertainment, computer and consumer product industries. Personal interviews were supplemented by extensive secondary research. The primary and secondary research was tabulated, analyzed and interpreted.
CONTENTS
For a full listing of the table of contents, list of figures, and list of tables, The contents of the report can be briefly summarized as follows:
- Introduction. Describes the culture clash between the computer, entertainment, and communications companies. Includes a detailed description of the FCC actions regarding DTV.
- Executive Summary. Summarizes the key points of the report. Digital TV will happen because it is everyone's best interests. Impact on displays will be determined by the proportion of the DTV content that is SDTV, EDTV, and HDTV. CRT displays will continue to dominate value priced product segments. Only microdisplay based rear projection can challenge CRT performance and price.
- Content and Services. Will determine the demand for new displays. Key issues are the proportion of content that is SDTV, EDTV, or HDTV. Identifies types of content and applications that require EDTV and HDTV. Analyzes broadcast, cable, and DBS conversion plans. Develops schedules for DTV content availability.
- Participants. Identifies industry groups in content, pipeline, and hardware sectors from both the analog and digital world. Analyzes broadcast, cable, and DBS industry strategies. Gives brief description of DTV programs and activities for more than 100 companies.
- Consumer Demand. Stresses importance of DTV content over picture quality. Develops price sensitivity guidelines based on experience of other industries. Identifies 16:9 wide aspect ratio video content as the key consumer demand issue driving the market.
- Channels. Discusses consumer channel preferences. Describes current display company strategies for separate or integrated DTV interfaces.
- Regulations and Standards. Describes the disarray of both computer, television and home network standards. DTV schedule and must carry. Requirement that all set top boxes output NTSC signal to drive legacy televisions. Discusses activities of various standards committees. Overview of media processing challenge.
- Home Systems. Evolution of PC and set top box centric systems. Segments home display market into value and premium priced monitor and television segments and presents features and performance requirements. Differentiates between monitor and television ergonomics. Describes analog, digital, and network interface requirements. Introduces image processing as a major requirement for multiple input capability and an important new cost element.
- Forecast. Describes evolution of consumer households and displays. Develops two scenarios for DTV roll out, an optimistic on-schedule case, and a more realistic case. Forecasts penetration of DTV televisions and monitors for the 2 cases and a unit forecast by display class. Describes competitive positioning of the display technologies by product class and forecast market share by technology for each display segment. Develops unit forecast by technology.
- Conclusions and Recommendations. DTV is coming and EDTV will prove popular in high volume, value priced market segments. HDTV will have a market impact only in low volume, premium priced segments. Display makers should aggressively roll out widescreen monitors and televisions and look for a variety of channel deals and partnerships to enhance market position.
BACKGROUND A NEW FRAMEWORK FOR THE U. S. DISPLAY MARKET
The sustained expansion and growth of the Enterprise monitor market has been driven by the explosive demand for personal computers. Annual sales of PC attached monitors in the U.S. now exceed 39 million units. User preference has shifted from small 13 -14 inch monochrome character displays to 15 to 20 inch high definition full color monitors with multimedia capability. Although domestic consumer TV sales have leveled off, they are expected to exceed 26 million units in 1998. Another 6 million displays will be used in embedded applications.
For the display industry, the next eight years will be one of momentous change. Both home consumers and enterprise customers have made it clear that they want larger screens, multimedia capability and higher reliability. The convergence of entertainment, computer and telecommunication services is now underway. Users have further expressed a growing interest in flat panel monitors for both desktop and entertainment applications.
But these trends pale in comparison with what is going to happen next. New technologies, coupled with recent FCC regulations, now promises to change the format and transmission characteristics of the video signal. Entertainment TV is going digital. All terrestrial broadcasting must be in a digital format by 2006. Cable and satellite service broadcasting is already on the road to an all digital format. Unidirectional signal transmission will become increasingly bi-directional.
Of the 106 million consumer displays in the United States, 23 million (22 percent) will be coupled to the Internet by the end of 1998. The Consumer is being drawn into the Interactive services environment. The WEB will be on TV and TV will be on the WEB.
The Cable, Satellite and Terrestrial TV industries are in a pitched battle with the computer and telecommunication industries to control the market for signal transmission, storage and routing. Most of these same companies are either in the content and interactive services businesses, or making deals with other companies that can deliver the content and services their network users will buy.
In the consumer market, there will be a fusion of entertainment, education, information and computing services. In the Enterprise market, the fusion of computing, communication and image rich applications is already underway.
These changes will disrupt the classical markets for entertainment and computer displays. Digital Television including High-Definition Television (HDTV) using legislated standards on how bits reach the public consumer, will offer a whole new set of multimedia and interactive services and applications to the consumer. Internet TV will digitize TV using existing computer network technology. The computer geeks have a head start. At this point, one could make the argument that digital TV will end up aligning with WEB standards rather than with HDTV standards.
REPORT FORMAT
The report is a 192 page printed document. MCG will also provide confidential interactive consultation and presentation support to those clients who wish to explore the implications of MCG's research and analysis.
MCG PERSONNEL - About the authors
This study will be co-managed by Ron Cooke - author of last year's well received report on the market for FPD monitors, and Chuck McLaughlin - who is a recognized authority on display technology.
SUBSCRIPTION AND DELIVERY
The report was published in December 1998 and is available for immediate delivery. Please direct all subscription and price inquiries to Chuck McLaughlin, 650 323 7155.