Apps on the TV: no one cares yet

Feeling bad for all the TV manufacturers with ailing TV businesses? Maybe you should try those apps that came with your new flat screen.

TV manufacturer profits

(Credit: IHS)

The basic problem with the TV business is that there's very little a manufacturer can do to stand out from the crowd, says Tom Morrod, an IHS television analyst speaking at the firm's Technology, Media and Telecommunications (TMT) Summit in Paris. Manufacturers try to differentiate by adding apps and other higher-level services, but customers consistently care chiefly about price, screen size and image quality.

"TVs are used to watch video, and that's pretty much the only feature people are interested in," Morrod said. "The value is in the display, not the peripheral features."

It's not like buying a smartphone, where apps and services are a big part of the package. When people buy a phone or a tablet, they're buying into an ecosystem. With TVs, though, the ecosystem most customers plug in to is supplied by service providers, he said. In Australia, these providers are the free-to-air networks, the pay-TV operator Foxtel, streaming services or BitTorrent.

Thus, the business becomes one of selling flat-panel displays. And there, new technology becomes a commodity "very quickly". Today's fancy new option — 3D, say, or higher 4K or QFHD (quad full high-definition) resolutions — is tomorrow's ho-hum checkbox on a feature list.

"They'll come in and rapidly be commoditised," he said. "You can't derive long-term high [profit] margins from screen technology."

That helps explain the dismal performance of TV manufacturers in recent years, despite the increasing number of screens that customers buy in developed nations. Volume is increasing, but the overall money spent on TVs is staying more or less flat, which means average selling prices are steadily dropping.

"Every TV manufacturer has had some kind of problem, some kind of profit warning," Morrod said. "It's a very difficult business to be in."

He did offer two rays of hope, though.

Internet connectivity

"This is a huge opportunity. Adding an internet connection to a TV means an opportunity to differentiate on software, rather than hardware. You can directly send content to the platform," he said. And if they can convince people to spend money on apps, they'll be more likely to buy the next TV from the same company.

Voice- and gesture-controlled TVs

The clunky remote control, so difficult for anything more than rudimentary controls, will face competition from more natural interfaces that rely on cameras and microphones. LG, Philips and Samsung are actively going down this path, and the rumoured Apple TV could follow suit. Once there's a camera and microphone in a TV, it can do things a set-top box can't, and that means people could be persuaded to do more with their TV apps, he said.

"If you put a camera or microphone on top of TV, you reach [a] very interesting inflection point," Morrod said.


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weinndine posted a comment   

It's true that not a lot of people appreciate this incredible technology. I was not interested in smart TVs at all too until I got my first set. This technology definitely has a future because I know lot of people find them quite useful and it's only going to get better from here. I currently have a LG smart TV and I'm telling you they can surprise you with some features that not many people can manage to materialize.


smarttrams posted a comment   

Samsung did a good job in apps though


CampbellS posted a comment   

I purchased the Samsung UA466000 Series LED Backlight in beginning of 2010. Paid 2200 for it at a sale price. Looked at the latest Samsing LED TV's yesterday the UA556000 series 55inch at they are 1700 dollars !! for a 55inch. They have dropped alot. My 6 series from 2010 is still going strong , cant play movies thrugh USB at thats only 7 and 8 series. But I hooked up a media player via HDMI, so pretty sorted. Dont see the need upgrade as my current one hasnt missed a beat.


Ramrunner posted a comment   

As for myself, I have a Samsung UA55D7000 when they went cheap to make room for the 2012 LCDs. I thought the SmartHub was a cool feature, when I bought it.

In order that I use features:

1> Stream media from my NAS.
2> As above but for 3D content (yes, I actually use the 3D)
3> Watch normal TV.

So basically all I ask for is a 3D capable TV set at Full HD with a good media player that can stream from a NAS.

The media players in the TVs are improving, but more work needs to be done. "Video Codec not supported" is ridiculous in this day and age. Really.

Other than that, everything else is pretty much wasted for me.


CampbellS posted a reply   

Yes its annoying. Certain types of avi are not supported and MKV is never supported.

Get a WD media player with wifi and hook it up ti the TV with hdmi. It play's everything under the sun. The only thing it might be iffy with is Bluray files.


grumpi posted a comment   

Morrod is right in saying "the value is in the display, not the peripheral features."
The peripheral features keep changing and are best served a Media Centre PC or PVR.

I won't be interested in another TV until 4K or 8K TV's are mainstream.


thesorehead posted a comment   

Do people really buy TV after TV, year after year? Is this some trend that I've been completely oblivious to? To be fair, my mobile phone turnover has been biannually (thanks to phone plans) for a while now - perhaps content providers could have a similar system to telcos?

Actually, that doesn't sound half bad. I currently pay Vodafone a monthly fee to access their telco services and have posession of a nice smartphone with insurance and warranty. Replace "Vodafone" with "Microsoft"; "telco services" with "Xbox Live! Gold" and "smartphone" with "FHD TV".

Outright on a lot of smartphones is $700-$900 - you can get a decent Samsung TV for that much. Could I be on to something here?


Chandler posted a comment   

In my opinion, I think the greater picture is this - the 'TV boom' is ending, and people are less willing to part with more exorbitant amounts of money year after year. Whilst the technology behind televisions improves, the basic principles are still the same, and these days improvements to things like image quality are getting less discernible.


CampbellS posted a reply   

I remember when flat screens first came out in the late 1990's , a plasma 55inch going for 6000 dollars while you could buy a LCD computer sreen for a couple hundred. Its interesting they ignored LCD for TV's for years even the tech had been around for ages.
The TV boom has ended , as TV developement has levelled off due to the quality like 1080 becoming mainstream. I'll be keeping my Samsung LED Backlight for a while yet as quality wise nothing has changed with the new ones only gimmicks like 'smart TV' which does nothing for me and has had some seriously bad reviews.
Maybe when LED TV's get to be 60inch for 1500 maybe I'll consider upgrading. But as for now Im staying with my LED Bcklight

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