Sunday, 28 July 2013

(28-07-2013) OLED Finally Arrives, But Is The Dream TV Really Worth It? - Bus1nessN3wz

OLED Finally Arrives, But Is The Dream TV Really Worth It? Jul 28th 2013, 14:12

Samsung and LG wowed visitors to January's Consumer Electronics Show with prototypes of a new kind of flat-panel television using OLED technology. OLEDs, which also power the screens in Samsung's Galaxy S4 phones, promise unprecedented contrast and thinness in TVs — and the demos didn't disappoint. The lack of shipping products, however, did. The TVs were first shown last year and both Korean electronic giants promised to ship within months. Technically, OLED stands for organic light-emitting diode, but for the past decade, the "D" might as well have stood for delay. At last, though, 18 months from those demos, LG and Samsung are bringing products to the U.S. They're strange and extraordinarily expensive, but they're real.

Once upon a time, it seemed like OLED might be the preeminent flat-panel technology. As early as 2001, Sony and Universal Display were putting out press releases touting joint development plans for large-screen OLED televisions. It would be a couple of years before mass production of large-size LCD TVs became possible and the hype was always that OLED was that much better and imminent. But "imminent" — like those announcements from last year's CES — never arrived because OLED never had the manufacturing breakthrough that LCD did. And it still hasn't, which is why the 55-inch models LG and Samsung sets will be available for a breathtaking $15,000 — literally 6 times as expensive as a top-of-the-line LCD of the same size.

What do you get for your money?

The two sets (LG's 55EA9800 and Samsung's 55KNS9) are more similar than different. Both will have a contrast ratio that is better than anything on the market, with black levels so dark you'll find images incredibly rich, detailed and realistic. Both screens are also gently curved, like the screens at some Imaxtheaters. I asked John Taylor, LG's VP of Public Affairs in the U.S. why they were releasing the curved model here, which was bound to come off as a bit odd after more than a decade of truly flat TVs.

He said the OLED was "really revolutionary, a whole new way to display television." And that there was "a lot of interest in curved among our retailers." Taylor noted the curve was gentle and that it makes a pretty strong design statement. And, realistically, it's going to help the TVs stand out from the dozens of flat panels most retailers already have on display. The biggest problem OLED is going to face is that while the picture is qualitatively better, a lot of people might not see a dramatic difference — especially under harsh store lighting.

Beyond that, though, it's not the only new product the TV industry is trying to sell in 2013. The new "4K" sets, sometimes called ultra-high-definition can theoretically display 4 times as much detail as existing HDTVs. While there isn't much content to take advantage of that yet, more will come. And the OLEDs don't do 4K despite higher prices. (LG's own 4K 55-inch set is $6000; hardly cheap, but a relative bargain.)

The curved design is going to be polarizing. It will prevent the TV from being wall mounted and limit the "sweet spot" for viewing it, encouraging people to sit up close. Robert Zohn, owner of Value Electronics in Scarscale, NY, who will carry the Samsung OLED starting next week says, "We're going to suggest people sit up close: One to four viewers, 4-10 feet away. The curved screen really adds to the experience in an immersive way."

Who are these OLEDs for?

The high price will deter nearly everyone from buying it, which is partly by design on the part of the manufacturers. Although both sets are finally becoming available, quantities are genuinely limited by manufacturing problems that persist to this day. LG's Taylor said the company will have hundreds available for sale nationwide and eventually thousands. But the initial rollout  is limited to Best Buy/Magnolia locations in Los Angeles, New York, Miami, Houston, Dallas, San Francisco, Chicago, Seattle and San Antonio.

Taylor says LG will expand nationwide later in the year and eventually into specialty retail. Other sources, however, have insisted that orders placed mid-summer won't be filled for weeks and it could be awhile before you can walk into a store and drive home with one of these, which would otherwise be more possible than with most large flat-panel TVs.Why? Because the OLEDs are featherweights, with LG's at just 38 pounds. Samsung's production isn't much better. Zohn asked for five initially and received two. He expects to have a tough time getting many more through 2014.

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In other words, this isn't a case where the early buyers are being asked to pay a lot to drive production so the mainstream customer pays less later in some sort of price discrimination mechanic. Rather, it's a case where the manufacturers simply can't build very many; they're constraining demand by keeping prices very high. It seems likely that were it not for the rivalry between Samsung and LG in Korea, neither would bother to ship these right now at all. LG launched in flat model in London's famed Harrod's department store in March and secondhand info suggests they've sold all of four units since. The company claims to have delivered hundreds in its home country, but there is not one review, not a single "unboxing" video, not really much in the way of evidence that these are in the hands of consumers.

The problem is that each company has had a manufacturing issue it's been unable to solve. Samsung has been trying to scale up the method is uses to make screens for its mobile phones and the method has proved to be pretty incompatible with the large pieces of glass needed for big TVs. They can do it, but only with a lot of failed attempts, which lowers the "yield" of good panels. For its part, LG already has a method that should allow mass production and lower prices, but the growing pains have been brutal. LG also took the opportunity to switch out part of its display to something that goes by the ugly acronym IGZO. Eventually, IGZO will allow for everything from lower power iPhone displays to extend battery life and much cheaper OLED TVs. Today, ramping up production of IGZO for their TVs has been a nightmare for OLED, leading to terrible yields. Whehter that pain pays off in a technical lead over Samsung might not be apparent for year. (Samsung and LG also use different technologies to display the picture and Cnet can give you some more background on the differences, if you're interested. Both should perform exceptionally well, although having seen the prototypes a number of times, I remain wary of oversaturated, cartoon-ish colors.)

So should you buy?

Clearly, the product is a niche one at this point. Some people have drawn the comparison to the early plasma TVs, which were retailing for $15,000 late in the 1990s. But a huge difference between then and now is those were the only game in the town if you needed — or just craved — a flat screen. Today, you can walk into Costco and buy a dozen different TVs under $1000 that go up to 60 inches. Something that costs 15 times as much seems absurd. And it is. The performance gain over the industry-leading Panasonic ZT60 and Samsung F8500 plasma sets is real — but small. (Those two were the most popular at the annual Flat Panel Shootout held at Zohn's store, where industry leaders and enthusiasts compare the best TVs on the market).

Zohn described it this way: "A very small percentage of the population that would have any interest in this TV." He hopes it will be enthusiasts who can afford the current high price, but his first confirmed order was from a guy who he admitted was more bank account than videophile.

Beyond that, there are some things to be aware of. The models on display in Harrod's showed some signs of burn-in after just a few months on the floor. They are being abused by showing a menu all day, every day, which no normal person would do. But people fear burn-in on plasma TVs, which is actually quite hard to achieve these days. At least on the LG OLED, the concern needs to be raised. And, of course, there's the matter of the inevitable price cut, which will be steep and certain within 24 months. Many won't care about "overpaying", but the idea of being an early adopter at $15,000 when the price is headed down 80% in 3-4 years could frustrate others.

Industry forecaster DisplaySearch believes that 7 million OLEDs will be sold in 2016. While that represents less than 3% of the overall TV market, it's about 1/3 of the 55-inch-and-up segment. To get anywhere near that volume, pricing will need to be below $3000 by then. And everyone involved in OLED manufacturing has long insisted that ultimately, they should cost no more than LCD TVs do. If seeing the price come down that much doesn't bother you, consider three final things (1) The only size today isn't especially large at 55 inches. In many large family rooms or dedicated theaters, that's already a small TV and bigger ones will be coming. (2) If you are opposed to a curved screen and want a "normal" flat panel, that choice is also coming (3) LG's Taylor admitted that 4K and OLED will converge down the road. Indeed, Panasonic and Sony already showed prototypes of such TVs at CES in 2013 and they were stunning.

Consumer electronics has some inherent planned obsolescence built in but the old model of really high-priced early-adopter goods has largely gone by the wayside. A 2010 iPad was $500; so is a 2013 model. Of course, the new one is more capable, but note the consistency of pricing. No one was asked to pay $2000 even though Apple would likely have sold a few million at those prices. The OLED TVs are the equivalent of perhaps a $3000 iPad but unlike that original Apple tablet they aren't going to usher in a new era of television viewing. Better television viewing perhaps, but not new ways of watching or new, unique content. If you have the chance to see one in person, it's worth stopping for a look. Your best bet is probably to then move on and check back in mid-decade.

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