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Why are LCD/Plamas so costly ?

Rega

The_Falcon

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I have been wondering about this for a long time...Why are LCDs/Plamas priced so high ? Given the fact that we now have a car for 1 Lakh (Nano ofcourse)...can plastic and glass ever be so costly so as to cost more than a low end car ?

Manufacturers claim the price for setting up a plant is very high so these LCDs cost more and that 60% of the LCDs churned out have dead pixels so they have to be discarded.

I believe we (Indians) are being scammed for two reasons:

1. The price is rigged up way too high.
2. The LCDs are priced in terms of dollars so we end up paying a much higher price as compared to our earning power.

What do you say guys..is anyone here an expert who knows how this works out ?
 

sachin_k5

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The_falcon,

The reasons for high costs are not techincal but business. The talks of high defect rate is hard to believe since there are several ways to handle quality problems.

When a product is launched it has its "Product Life Cycle" curve where there is a growing demand for the product, then the demand levels, then finally drops till its finally dead. The time range for each stage can be in months or years. Now when it comes to pricing, guess which is the time range you can maximize the profits ?

Manufacturers try to keep their product in the high demand range for as long as possible by coming out with different colors,features,new technology additions, design change etc.

For lcd/plasma to hit dirt cheap rates you will have to wait till everyone has a lcd/plasma. But if you see, today a 28 inch lcd will cost you lesser than a 29 inch CRT tv 4 years ago :)
 

teky

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LCD/Plasma is still penetrating in India. Always the first adopters pay an higher premium, With people still considering to pick-up CRT TV from Market I highly doubt price drop happening any soon.

Also I don't tend to agree with pricing in Dollars, The prices in US are dead cheaper than India. So if it's just a matter of conversion it should be cheaper. As I said earlier the early will always be shafted by the greedy manufactures.

As Manufactures set-up their facilities in India, we can expect the prices to come down. Samsung has opened it's facility in Chennai recently.
 

nitinbose

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Hi,

It always happens that manufacturers, distributers & dealers price the commodities high, during a products initial period.

The reason is to provide a larger profit margin to the dealers, as its always the dealers who push the product to the market - which is why we often see some make/model more popular than others and why the dealers often try hard to push these products :eek:hyeah:; the reason being that the dealers are offered staggering profits on these models!

yes, as of now, you can get a 22" lcd tv for the same price a 21" CRT would have cost two years ago.

Ofcourse, the quality also goes down, especially the build quality, with reducing prices.
 

The_Falcon

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LCD/Plasma is still penetrating in India. Always the first adopters pay an higher premium, With people still considering to pick-up CRT TV from Market I highly doubt price drop happening any soon.

Also I don't tend to agree with pricing in Dollars, The prices in US are dead cheaper than India. So if it's just a matter of conversion it should be cheaper. As I said earlier the early will always be shafted by the greedy manufactures.

As Manufactures set-up their facilities in India, we can expect the prices to come down. Samsung has opened it's facility in Chennai recently.

When I say dollar price..I mean a US consumer can buy the product in say one months salary..but here we have to save for months. for e.g say an LCD costs $1000 (Rs.50,000) and average Indian consumer will have to save for five months (assuming salary @ 10,000/month).

Yes I agree with the CRT thing..I remember when I was in college Sony was selling a 29" CRT for Rs.50,000 and a similar TV now costs Rs. 18,000 from Sony.
 

adder

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well there are lots of reasons,its not the case in india check out the prices in europe if a product costs $500 in the US its costs 500 euros in UK,because of the import taxes like in india.
additionally we pay some more taxes like vat/cess etc.

in the US huge retailers buy in huge quantities from company and directly sell,in india its not always the case it first goes to distributors and then to dealers ,so each keep their respective profit margins.n
then their is difficulties in manufacturing,yes many panels are rejected since it doesn't meet the quality control standards like lcds with dead pixels and what not,just like how TSMC having yield issues with 45nm manufacturing technology.

so don't compare CRT with flat panels,CRT was in mass production for many decades,where as flat panels have just taken off in the last decade.
not all manufactures are making profits, lcd panels makers occasionally post losses .only samsung and LG seems to post huge profits in tv business,while companies like sony post historical losses in tv business and only plan on making profit or get even in 2010 and above.

companies also spend millions in R&D and setting up newer more efficient manufacturing plants which cost a lot.
 
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gobble

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When I say dollar price..I mean a US consumer can buy the product in say one months salary..but here we have to save for months. for e.g say an LCD costs $1000 (Rs.50,000) and average Indian consumer will have to save for five months (assuming salary @ 10,000/month).

Yes I agree with the CRT thing..I remember when I was in college Sony was selling a 29" CRT for Rs.50,000 and a similar TV now costs Rs. 18,000 from Sony.

If you compare the price of everything "modern" from a sandwich at Barista or coffee to washing machine or fridge, you will find the Indian prices are equivalent to U.S prices. However a dollar and half for a sandwich means nothing for an American but its a lot for Indians.

Wonder if it is due to the parallel black economy that is said to be equal or larger in size to the national "white" economy. :mad:

Cheers
 

Thad E Ginathom

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LCD TV is still seen (err, sold, sorry) as a luxury item in India. Much like Skoda cars! They are marketed and priced accordingly.

Companies like Sony are well known for adjusting their prices according to the market, and refusing to honour guarantees (which should be worldwide) for stuff bought in cheaper countries, to help them enforce that pricing.

Look at Richer Sounds - The UK's Hi-Fi, Home Cinema & Flat Panel TV Specialists! --- check the prices, and weep :sad:

(one UK pound is about Rs75 at the moment)

Another thing is the lack of consumer power and a real competitive supplier environment here. Nobody would start a "Richer Sounds" in India, because selling at substantial discount would just seem too wierd to them. Here, even dirty goods get sold at full price.

I went to a special Phillips sale of discounted, shop-soiled, refurbished returns, etc, a couple of months ago: it was like a junk shop, much of the stuff would have just been thrown away in Europe. There were some relative-bargain TVs, but (a), going by the looks of a lot of stuff on sale and the lack of proper, long term warranties, and (b), the fact that I didn't want a TV ;) meant I didn't buy one.
 
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The_Falcon

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@Thad

Hmmm I those prices @ richer sounds are very very tempting. Even @ the current exchange rate a 47" LG full HD is cheaper than a 37 incher here. Do you suggest grey market buys ? That way I can save a lot of moolah :D Anyone here from Mumbai..any suggestions on a good grey market buy ?
 

BLASTO

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Why do you think plasma TVs are costly?
Plasmas are cheaper than the equalent sized CRT TVs.

Can you show me an 42" CRT which were sold ~40k anytime?
~40k is the cost of 720p HDTV plasma.
 

BLASTO

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Totally different kettle of fish, and not at all a justification for the pricing.

Can you eloborate?
I for one think that for bigger size you have to pay more.
Why do you think that bringing size into the equation is not justifiable?
The title just says that LCD/Plasma TVs are costly. I ask they are costly compared to what? Do we have a cheaper technology to say that they are costly?

LCDs are very economical in smaller sizes and plasmas are very economical after a particular size.

If we keep CRT as a standard to compare the prices,
Until 32", today, LCDs cost almost same than CRTs and in >32", Plasmas are cheaper than CRTs.

Do you think that owning a 21" CRT for quite some time and then trying to upgrade to a higher sized flat panel and thinking that they are costly is the way people should be thinking? Infact CRT has serious design and size limitation which prevented it from growing in size any larger all through its life time (considering it is almost dead in terms of innovation)

I agree that CRT has a host of advantages but cost is not one of them. After around three decades of maturity, the CRTs were only able to match the price of LCDs which were hardly less than a decade old in maturity.

If the argument is whether these TVs become cheaper going forward, My answer is yes. But in these times when manufacturers are trying to take out R&D cost, it is unfair to calculate only the manufacturing cost and say that these TVs are costly.

As with all technology, If you can afford, get them at the nacent stage.. If you can't, wait for the prices to come down to consumer level.. Even CRTs were costly in their prime.. Not much of a difference here..
 
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BLASTO

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If the question is "Why LCD/Plasmas are costly in india?"

What else is cheaper in india? Don't even compare the cost of a nano. When we compare the comparitive version of any car that is sole both in india and the US, you'd know that they are much cheaper! A honda civic costs $20000 which is 10L. It costs 14L in india..

Nano is cheaper because, it is designed and made in india. The videocon LCDs are substantially cheaper in india (though it is not a 100% indian product). You can get a 32" videocon for 21k. Then you have to decide whether you want it even at that price.
 

Thad E Ginathom

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Well, let me admit that maybe I shouldn't be having this conversation because I don't watch TV!!! :eek:

But...

I don't think it is appropriate to make the comparison with CRT, or to use CRT as a yardstick. CRT, although it is going to take a long, long time to disappear, is an old technology. It is a different technology. As you say, there are challenges in getting CRT beyond a certain size, that seem to be much less with flat screen TVs. I well remember, from my work (retired about five years ago) that shifting a 17-inch CRT monitor was routine, shifting a 19-incher was hard work. Now I have a 22-inch LCD that can be carried with one hand.

I do not expect big flat-screen TVs to be cheap; they are a luxury item.

I would like to see prices in India comparable to some other countries. Many, many people, apparently, bring TVs back from abroad. Why? because they are sufficiently cheaper, is the one, simple reason for someone to risk carrying a large fragile item, possible customs hassles, possible warranty issues etc etc.

When I feel (even though I don't much watch it, I still have to look at it) like replacing our CRT TV, I look at prices here and, without being a great expert in this commodity, I know I could do much better in UK --- and it is not the cheapest plae in the world to buy electronics.

I put this down to the multinationals milking India with the idea that this is a much-newer-than-it-is luxury (even the smaller ones) technology, and the retail trade here that has a great self interest in keeping prices up and making profits as someone mentioned earlier in the thread. They must know about international pricing. They must be aware how the internet, outside india, has brought prices plummeting, and they must dread the day it happens here. Imagine going into a shop, showing a 30%-cheaper-on-the-net price, and getting a price match. It's a nightmare to the suppliers, and it something that the Indian consumer should be dreaming of. Three and five year warranties thrown in too!
 

The_Falcon

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Why do you think plasma TVs are costly?
Plasmas are cheaper than the equalent sized CRT TVs.

Can you show me an 42" CRT which were sold ~40k anytime?
~40k is the cost of 720p HDTV plasma.

True...but you don't get a 32" plasma(normally). It may be cheaper in terms of size but the amount of money is still quite a lot for and avg. Indian consumer. Its the same like buying something in bulk(here a larger screen), but if you cannot afford to buy it in bulk...it does turns out to be costly...right ?
 

BLASTO

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True...but you don't get a 32" plasma(normally). It may be cheaper in terms of size but the amount of money is still quite a lot for and avg. Indian consumer. Its the same like buying something in bulk(here a larger screen), but if you cannot afford to buy it in bulk...it does turns out to be costly...right ?

Iam not sure what your question is.. :(
Who buy's TVs in bulk? :rolleyes:
 

venkatcr

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I did a small calculation of the prices of various models and calculated the price per square inch. Here are the results:

Type Brand / Model |Price Per Diagonal Inch |Price per Square Inch
--------------------------------------------------------------
LCD Hitachi L42X02A |Rs.2024 | 113
LCD Hitachi UT42-MX700A |Rs.2739 | 153

LCD Panasonic TH-P42S10D |Rs.1404 | 78

LCD Samsung LA46B650T1R |Rs.2043 | 104

LCD Sony KLV-46V550A |Rs.1954 | 99
LCD Sony KLV-46Z550A |Rs.3891 | 198
LCD Sony KLV-52V550A |Rs.2882 | 130
LCD Sony KLV-52Z550A |Rs.5767 | 260
--------------------------------|-----------------|-----------
Plasma Hitachi P50X01A |Rs.2400 | 100
Plasma Panasonic TH-P50V10D |Rs.2600 | 108
Plasma Samsung LA52B550K1R |Rs.2788 | 126

The price of plasmas, as you can see has steadied across brands to an average of 110 per square inch. LCD prices, on the other hand, varies from 78 to as much as 260. This could be because LCDs are yet an emerging technology, and the manufacturers are spending money on R&D. There is always the opportunity costs involved when you introduce a new product. As you can see Sony's V series in less expensive than their Z series.

In totality, I find the Sony prices to be unreasonable. Are their prices worth whatever technology they are sprouting is the question?

Cheers
 
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adder

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I did a small calculation of the prices of various models and calculated the price per square inch. Here are the results:

--------------------------------------
LCD Hitachi L42X02A Rs.2024
LCD Hitachi UT42-MX700A Rs.2739

LCD Panasonic TH-P42S10D Rs.1404

LCD Samsung LA46B650T1R Rs.2043

LCD Sony KLV-46V550A Rs.1954
LCD Sony KLV-46Z550A Rs.3891
LCD Sony KLV-52V550A Rs.2882
LCD Sony KLV-52Z550A Rs.5767
---------------------------------------
Plasma Hitachi P50X01A Rs.2400
Plasma Panasonic TH-P50V10D Rs.2600
Plasma Samsung LA52B550K1R Rs.2788

The price of plasmas, as you can see has steadied across brands to an average of 2600 per square inch. LCD prices, on the other hand, varies from 1400 to as much as 5800. This could be because LCDs are yet an emerging technology, and the manufacturers are spending money on R&D. There is always the opportunity costs involved when you introduce a new product. As you can see Sony's V series in less expensive than their Z series.

In totality, I find the Sony prices to be unreasonable. Are their prices worth whatever technology they are sprouting is the question?

Cheers

well if u compared LG their prices are quite cheaper,they are assembled in india so is samsung.
lg for the most part use thier own panels.where as samsung even though they manufacture their own panels still uses panels from two other manufactures,hence their tvs are slightly higher,they are also the leader in sales,so they have shortage of their own panels.
also the price of lg 42" is cheaper compared to other 40/42" lcd suppliers.

in the case of sony they use panels from their joint venture with samsung called S lcd.they also use panels from AUO and very recently from sharp with their joint venture.
since sony is a direct import its subjected to around 30 to 35% custom duties,where as the LG and samsung which are assembled in india are taxed only at 5%,hence the huge price difference.
in china one can get the Sony KLV-46V550A for around 55k which is like Rs1195/ inch.in thailand many models are cheaper then samsung offering,hence if go to the grey market,u will find the sony to be cheaper then the samsung.

as far as plasma they need to be priced cheap if they have to sell,even despite this they still are loosing the market share,so it won't help them if they price it higher.
 
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venkatcr

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I skipped LG, because, on a very subjective note, I felt they are yet a couple of years behind the others in technology.

As regards Sony, if they have to take the market seriously they have to find ways of bringing their prices to a reasonable level. I see a lot of their showrooms shutting down across the city. I am not looking at international prices or at the gray market. Only what is available legally in the showrooms or dealers.

Cheers
 
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