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Rich Folk Buy HDTVs

October 27, 2006 | Author: Ibex Marketing

Last week, a story in USA Today cited a report from the Leichtman Research Group that revealed — among other things — that 63% of the U.S. households with one or more HDTV had an annual income of $75,000 or more. I don’t find that at all surprising. The fact that 6% of households with an annual income under $30,000 have an HDTV is more surprising, though I suspect that there are a lot of adult students from more affluent families who received one as a gift, which helps boost those numbers.

By many accounts, the average amount spent for a television by U.S. households has averaged $300 to $400. A majority of U.S. households probably cannot afford to spend much more than this, so it should come as no surprise that only people with higher incomes have the disposable income available to spend $2,000 or more on an HDTV. (And as much as $100 per month for HDTV cable or satellite service can add another $1,200 every year.)

Yes, prices continue to fall. And yes, more people are buying HDTVs. But it still is unreasonable to expect that every home will have a 42″ flat panel HDTV any time soon. The bigger question is whether or not there are enough consumers out there with enough money to sustain the growth that the manufacturers are counting on to justify their plans to expand production capacity.