The End of Rear Projection TV and its Implications for Plasma

By the end of 2008, Mitsubishi Electric Corp was the only manufacturer left in rear projection televisions (RPTVs) as Sony Corp and Samsung Corp ceased production. Four years later, the last remaining manufacturer announced the cessation of production of its line of DLP rear projection TVs. This technology was best-suited for large applications. Mitsubishi’s 2012 line up ranged from 73” to 92” behemoths and was positioned as the best value for money proposition for consumers looking for televisions of that size. However, as LCD panels became cheaper and more efficient in large televisions, this value proposition started to erode and sales started to decline. Much of the same can be said about plasma TVs. This begs the question of when the last of the major manufacturers will cease production of plasma TVs, namely Samsung Corp, LG Corp and Panasonic Corp. This is most likely to occur by the end of 2014.

Transitional Technologies

Plasma and RPTV bear a number of similarities in terms of advantages, shortcomings, and positioning, which is why we expect plasma to be the next projection technology to reach its end-of-life.

• Operational difficulties: both RPTV and plasma offer several advantages in terms of image quality over most LCD TVs, but these advantages come at a cost of higher operational costs for consumers. The colour rendering of RPTVs is unlikely to ever be matched by any LCD TV but DLP TVs became notorious for their short-life spans due to bulb failure. Mitsubishi solved this problem by replacing the bulb with a laser but far too late to save the technology. Plasma TVs also tend to offer better colour rendering then LCD TVs but their main advantage is the higher refresh rate, resulting in smoother motion rendering. However, this also comes at the cost of a lower life span and, in the case of plasma, screen burn-in along with higher energy use compared to LCD TVs.
• Perceived inferiority complex: LCD TVs have one major advantage over both technologies: a slim form. Technological limitations enable LCD TVs to be much slimmer in comparison to RPTVs and Plasma TVs. This slim form is one of the main selling points for LCD TVs, with manufacturers striving to produce the slimmest possible TV. This in turn resulted in many consumers making TV slimness an important component of the purchase decision, perceiving thicker models as inferior.
• Size over scale: both plasma and RPTV are used in larger applications. Over their life span there were very few RPTVs available with screens smaller than 50”. Plasma screens smaller than 40” are equally uncommon. LCD displays are widely used in applications ranging from mobile phone screens to large TVs. This enabled large scale production of LCD panels, cutting per unit costs and generating income for research and development which improved technology. This enabled manufacturers to build increasingly efficient large LCD panels, depressing sales of RPTVs as well as plasmas.

Global Volume Sales of TVs by Projection Technology

Source: Euromonitor International

The combination of factors made both technologies transitional steps that filled niche roles in the transition from CRT to LCD TVs.

Death by Restructuring

Panasonic Corp found itself in a difficult financial position at the end of 2012, largely because of losses incurred by its television business. While LG Corp and Samsung Corp are in a better overall financial position, their TV divisions are underperforming. This makes it very likely that all three manufacturers will sell-off or restructure their TV business operations within the next two years. With stagnating global volume sales and declining constant value sales expected for plasma TVs for 2013 and 2014, it is likely that this technology will not survive restructuring efforts by the major manufacturers.