A Christmas present to consumers: lower prices on TVs - East Valley Tribune: Business

A Christmas present to consumers: lower prices on TVs

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Posted: Sunday, November 14, 2010 11:00 am | Updated: 10:15 am, Tue Nov 23, 2010.

Plentiful supplies and low component costs have added up to big price drops on televisions for the holiday season.

TV prices typically are lower for the holidays, but this year the tags on flat-screen high-definition sets could drop 20 percent on average and as much as 40 percent on larger models.

The falling prices are on TVs with 1080-pixel resolution and newer LED backlighting technology that provides better contrast and more accurate colors, experts said.

One industry analyst expects holiday prices on a 32-inch LCD flat-screen to be "approaching $200" by Black Friday, the day after Thanksgiving and traditionally the first big shopping day of the holiday season, when retailers offer bargains galore.

Even a 42-inch TV could be under $300, said Shawn Dubravac, chief economist for the Consumer Electronics Association.

Jim Grzywinski, manager of the Appliance Center store in Maumee, Ohio, said he was stunned by the size of discounts this year.

"This is the first time in the 35 years I've been in the business that I've seen it drop this much," he said. "Usually you don't see prices like this before Christmas. Usually it's after Christmas when they're trying to get rid of older models."

Prices for flat-panel LCD TVs of all types already were down 5 percent overall last month compared to a year ago, experts said.

The research firm iSuppli predicts that Black Friday discounts on 32-inch LCD TVs will drop prices to an average of $249 to $299, with deals as low as $199. Dubravac expects prices to drop slowly, with huge markdowns on Black Friday and in the first few weeks of December.

Walmart has laid the groundwork. The nation's largest retailer cut prices on five sizes of its Vizio LCD TV models. The price on a 26-inch 720-pixel model dropped $100 to $198, a 32-inch 720p model dropped $50 to $298, a 42-inch 1080p model dropped $50 to $498 and a 55-inch 1080p model dropped $200 to $1,098.

Best Buy recently launched its own early two-day sale, offering a 32-inch 720p model, regularly priced at $299, for $259.

Last year on Black Friday, Best Buy had specials on LCD flat-screens for $299 for a 32-inch TV with 720p and $439 for 1080 pixels. Walmart's lowest price was $248 for 32-inch 720 pixels.

Discounts on popular electronics are nothing new.

But Paul Gagnon, director of North America TV research for DisplaySearch, a research and consulting firm in Santa Clara, Calif., said TV sales slowed so much this summer that inventory built up significantly.

Both Sharp Corp. and LG Electronics Inc. warned last month that a glut of inventory in flat-panel televisions was piling up as consumer spending in the United States declined.

Also, TV-component costs have slid. Corning Inc., a maker of glass for flat-panel TVs, said it expected glass prices to decline to the mid-single-digit range this quarter because of ample supply of glass for televisions.

Gagnon said that half the cost of a flat-panel TV is the glass screen. "That's the critical piece that fluctuates up and down in price," he said.

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