The ultra HD supply chain came together at this year’s SES Ultra HD Conference at the techUK offices in Lonon to discuss the market, content availability and the challenges of educating consumers…
Let’s get this right before we move on
In a discussion about how retailers can keep up with developments across the television sector, Sean Hannam, Retail and Technology Journalist, quoted a statistic he had seen.
‘Over half of the population in the USA have a 4K television, yet half of those people are not actually watching 4K content.’ He referred to the fact that people do have 4K television sets at home, but he believes consumers still need educating on the upgrade process from simple HD.
“Yes, the margins on TVs are terrible at the moment, but I think we need to get the 4K TV market right before we start selling people 8K,” he said. “Or if we are doing this, let’s make sure we get the stats right and we get the message out there on the shop floor. It’s a massive job to educate the public on 8K. But there’s still a window for retailers and there’s still a great opportunity for them to make some money.”
Stuart Savage, Director EU Innovation Digital TV R&D, LG Electronics, reported of similar issues where regulation in other quarters is starting to affect business operations and the content that is offered nowadays. “More television manufacturers are moving into a service-oriented approach, blurring the lines between just selling them and becoming aggregators of content and providing services,” he said.
“It’s not about making the best, shiniest, highest-performing technical device; it’s about building a whole business eco-chain that supports our business moving forward. We can’t survive similarly just selling devices as black boxes – we have to look more wider than that in order to move forward.”
Retra’s CEO, Howard Saycell, moved the conversation on towards the possibility of a model going forward with a shared revenue stream with the broadcasters, the distributors, the manufacturers and the retailers…
“It doesn’t feel like it’s very fair at the moment,” he stated. “There are clearly people making good money out of content, but there are whole swathes of the business that don’t make any money at all. I’m convinced that we give away wonderful technology, and you don’t see that happening in many other industries. “It’s all about supply and demand, but there’s too much supply and not enough demand,” he added.
Mr Savage went on to explain that three things sell televisions – the price, size and picture quality. “The price and size you can see on the website, it’s only the quality you can’t, but there are so many reviews online nowadays that you don’t even need to go into the shop. You can rely on an expert to do that for you.”
Continuing the discussion, Mr Hannam mused that dealers could try more inviting initiatives that incorporate audio technology, such as music nights in-store or film nights with 4K content and top quality speakers. “Somehow the brands will need to work closer with retail outfits to make sure the sales are going through,” he said.
Retra CEO reports: Members are pulling out of TV
The current TV market is not sustainable for retailers. This was the hard-hitting statement from Howard Saycell, Retra’s Chief Executive. Talking about conversations he has with members, reflecting how tough things are on the high street currently, Mr Saycell remarked: “Our members have fixed costs with staffing, stock and pay and all these things, and they have to make margin on what they sell. We all want people to look at 4K and 8K and be enthused by it, but the reality today is that there are poor returns for retailers.”
He went on to say that a significant amount of Retra members are swapping their television display areas for fitted kitchens due to “all the extra selling opportunities” that brings.
“One member told me not too long ago, he bought some TVs in, the price in the market had fallen and a new range had come in – unsurprising since there are new ranges all the time. He ended up selling a £1,000 television set and making £8. “This is not sustainable.”
Retra members are moving into home installation and smart home services, Mr Saycell claimed. While many retailers continue to sell televisions as part of these packages, there are other market forces to be aware of, such as consumer legislation, the Sale of Goods Act, the EU’s Right To Repair Act, which, he warned, will affect not just retailers but manufacturers too.
He concluded: “The bottom line is, many of our members have either pulled out of TV completely or have significantly reduced – maybe from 10 metres of TVs in-store to three metres. They still want to offer these products but there is simply no return on investment.”
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The golden age of television
People across the UK are watching nearly a full day’s worth of television every week; that’s according to data from the Digital TV Group (DTG), presented by CEO, Richard Lindsay-Davies.
“TV content quality and programme choices are getting better,” he said, “but the reality is that business models are changing.”
It’s a really exciting time for the industry, he continued, with many elements that are improving, whether it’s HDR, high frame rate, next generation audio or wide colour gamut.
“The opportunities are there, the question for us is, how do we sustain the business models?” he added. “We are in the golden age of television in terms of the quality of experience and the programmes we have available to us these days. When we get it right, our content in the UK can blow you away – it’s amazing!”
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Content is coming
Reflecting on the day’s events, Thomas Wrede, VP New Technology and Standards at SES (pictured), referred to the day as “pragmatic” and he said content well reflected the status of the industry at the moment with regards to 4K and 8K. “There’s a much higher degree of confidence in 4K UHD,” he said. “It comes at a cost, but content is coming.”
Mr Wrede (pictured left) added that he believes UHD is fully established, but also that 8K is not commercially viable for many businesses at the moment.
“From a technology perspective, this needs to be dealt with. I have the feeling that in the next few years you’ll only get larger flat screens with an 8K panel. So we have to address this issue.”
8K will come inevitably
SES Astra GB’s Mike Chandler said: “There were several key messages from today’s conference – one of them about simplicity for the consumer. They are bombarded with all the different TV standards today, and when you look at the very top end they need some specialist advice and hopefully there will be retailers around who can take that on.
“For those who are providing extra services – they install, network houses, work with builders and specify designs etc – they will do very well. But I think there will be an exodus on the high street and there won’t be the more basic retailers around anymore. And the same with manufacturers. It’s a sad reflection.”
