Dark clouds invade forecast for 8K TV shipments

A major tech market research firm quietly downgraded its forecast for 8K TV shipments—and the new numbers look especially bad in the U.S.

Instead of the 430,000-plus that IHS Markit forecast in October for 2019 worldwide 8K TV shipments, the London-based research firm now predicts that only 138,500 will ship this year. And, instead of nearly 2 million 8K sets in 2020, it now calls for 630,100.

Maria Rua Aguete, executive director for technology, media and telecommunication at IHS, shared this downgraded forecast April 26 at the IFA Global Press Conference in Punta Umbría, Spain. But, Rua Aguete’s presentation at this event, hosted by the organizers of the IFA electronics trade show in Berlin, glossed over much of the bad news.

For instance, an estimate of just 18,600 8K sets shipped in 2018 hid a count of only 200 shipped in North America. The balance went to Europe (9,000, with most in western Europe), Japan (6,600), China (1,500) and the rest of the Asia-Pacific market (1,300).

In an email to FierceVideo, Rua Aguete characterized the U.S. market as place where retailers remain unconvinced on 8K and only a single Samsung SKU (85-inch) was listed.

IHS—which in 2015 looked pessimistic for predicting shipments of only 911,000 8K TVs in 2019—doesn’t have much higher expectations for the U.S. in the following years. To wit: 43,900 8K sets will be shipped in 2019, 258,600 in 2020, 547,700 in 2021, and 843,400 in 2022.

IHS analyst Paul Gray emailed FierceVideo, indicating that the firm revised its earlier forecasts in March, saying “retailer interest in the U.S. was very weak, and in China brands were far less enthusiastic than we had expected.”

In contrast, the Consumer Technology Association forecast released at CES in January called for U.S. 8K shipments to hit 200,000 in 2019, 500,000 in 2020, 1.2 million in 2021 and 1.5 million in 2022.

CTA spokeswoman Danielle Cassagnol said that the trade group would revisit all these numbers in July’s update to this forecast, but meanwhile, those figures stand.

Analyst Mark Vena of Moor Insights & Strategy, who watched Rua Aguete’s IFA GPC presentation, said he agreed with her assessment.

“I’ve always been a bit skeptical of 8K’s appeal with mainstream consumers,” he emailed. “Major headwind factors include still not enough meaningful content that clearly demonstrates 8K’s improved video quality (especially vs. 4K); continued sluggishness with the cable providers to upgrade their set top boxes (and the infrastructure) to provide 8K content; and the ongoing availability of very good 4K TVs at terrific (especially sub-$1,500) pricing.”

The biggest TV firm exhibiting at IFA GPC underscored that last point: TCL, which said it’s now the No. 2 vendor worldwide by shipment volume, said it will sell a 55-inch 4K set in Europe for just €699. TCL will also bring 8K sets to the EU market, but they will occupy the highest slot among 11 product lines—three still only HD.

TV[R]EV lead analyst Alan Wolk was as pessimistic as Vena.

“I think the industry is still struggling to make 4K a thing, so I don’t see 8K happening any time soon,” he said in an email. “There may be some special effects movies that benefit from it, but otherwise I don’t see a lot of demand, either for the content or for the TVs.”

Japan—the one market with 8K broadcasts already available, thanks to NHK’s move to push that as part of its coverage of the 2020 Summer Olympics there—doesn’t figure too large in IHS’s latest forecasts either.

“Shipments will still be low at just over 80,000 in 2020,” Gray said. He blamed a “generalized preference for much smaller screen sizes – sizes below where even 4K starts,” and a strong start for OLED screens, which already hold a 45% share of 65-inch screens there.

It’s China that looks to become 8K’s brightest market: IHS now forecasts that shipments will surge to 46,000 in 2019 and then 369,000 in 2020. But that, Gray explained, mainly reflects cultural and supply-chain factors.

“TVs are a status symbol in China in the way they are not in the U.S. or Europe,” he said, citing lower car ownership and smaller homes. “Furthermore, the Chinese market has brutal pricing – 65 inches is a break-even product, all smaller sizes loss-making!”

Asked what might change 8K’s fortunes back in the U.S., Vena suggested that 8K vendors push compelling native content instead of counting on up-scaled 4K fare—although without support from cable TV, that will require exceptionally fast broadband connections untrammeled by data caps.

“The industry may need to hang its hat on promoting upcoming, highly prominent events (like the Olympics) that will best enjoyed on 75-inch class screens and have the best chance of showing the superior image quality,” he said. Then he added a caveat: “To put this in perspective, even last year’s World Series wasn’t broadcast in 4K.”

(Disclosure: The IFA GPC organizers covered most of my travel costs and those of other journalists and analysts attending this event.)