Sony Keeps Banging Head Against 3-D TV Wall

by Anthony John Agnello | January 13, 2011 1:46 pm

Sony Keeps Banging Head Against 3-D TV Wall

Among the handful of high-definition TV manufacturers, no company is pushing 3-D television harder than Sony (NYSE:SNE[1]).

For a company with difficulty getting its plethora of entertainment and consumer electronics divisions to work in tandem with one another, Sony has been impressively unified in its message that stereoscopic 3-D is the future of home entertainment. Sony released its line of 3D-ready (meaning, the TV can operate in both 3-D and 2-D modes with the requisite LCD glasses) Bravia HD television sets at the beginning of 2010 and released software updates for its line of Blu-ray players and its Playstation 3 video game console that allowed those devices to play 3-D movies and games.

At last week’s Consumer Electronics Show, Sony made 3-D TV the focus of its stage presentation, introducing new products like the Sony 3D camcorder in addition to prototypes like the personal 3D display headset.

Unfortunately, it doesn’t matter how many times Sony says that 3-D is the future. Consumers decide this, and right now, 3-D is floundering.  Sony has said since March that it expects 3-D and 3-D-ready TVs to account for 10% of its television sales in the U.S. at the end of this fiscal year, but this goal looks increasingly unlikely.

Interest in 3-D televisions varies depending on which data you consult, but in all cases consumers have shown that they don’t see the value in owning a 3-D television. Exposure isn’t the problem. A study last fall by Nielsen found that consumers were actually less likely to purchase a 3-D-ready TV after seeing one in use — 13% said they were “not at all likely” to purchase one in the next year before watching one. That number increased to 30% after the respondents were shown 3-D television content. Another recent study published by Leichtman Research showed that exposure to the technology could be better, with just 24% of adults having seen 3-D televisions in action. But 32% of them rated the technology as “poor.”

Sony and Panasonic (NYSE:PC[2]) believe the key is providing more broadcast television content. A Wall Street Journal report on Thursday says Sony is partnering with Fuji Television Network (PINK:FJTNF[3]) and SkyPerfectTv in Japan to produce Tokyo Control, a 3-D drama series. Panasonic, which already has joined with Japanese satellite station BS Asahi to produce a 10-minute music program for the Viera line of 3-D TVs, is also developing partnerships for new television shows to push 3D sales.

New content, whether from film or television, won’t help Sony and Panasonic sell Bravia and Viera televisions, though. New home versions of successful 3-D films like Toy Story 3 and Tron won’t help Sharp, Samsung, or LG sell their 3-D-ready sets either. The fact of the matter is that the consumer market, even the early adopter market, is simply not interested in the technology in its current form. True 3-D sets like Toshiba’s autostereoscopic (read: glasses-free) may capture audiences’ attention in a few years, but the technology is too expensive to be broadly embraced in 2011 or even 2012.

The most telling statistic in Leichtman’s December study was not that only 24% of adults have seen 3-D TVs, but that only 60% of U.S. households have upgraded to high-definition television sets. Sony, Panasonic, and every other manufacturer should be pouring their efforts into further lowering prices and improving basic HDTV technology if they hope to spur television sales over their tepid 2010.

As of this writing, Anthony John Agnello did not own a position in any of the stocks named here.

Endnotes:
  1. SNE: http://studio-5.financialcontent.com/investplace/quote?Symbol=SNE
  2. PC: http://studio-5.financialcontent.com/investplace/quote?Symbol=PC
  3. FJTNF: http://studio-5.financialcontent.com/investplace/quote?Symbol=FJTNF

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