Olevia: HDTV Trend Setter?

The New York Times published a story earlier this week with the headline “The No-Name Brand Behind the Latest Flat-Panel Price War”. The story makes the case that the Olevia brand of LCD HDTVs made by Syntax-Brillian were responsible for the incredibly low prices seen during last year’s holiday shopping season. The article cites Circuit City’s price of $475 for a 32-inch model, which was indeed an astonishing price.

But there’s a lot more to the story than just the Olevia brand. There are other similarly-positioned brands that did their best to reset expectations at lower price points; V Inc.’s Vizio brand and Westinghouse LCD HDTVs come immediately to mind. But in the grand scheme of things, these three were just gnats buzzing around the market. If you look at the unit volume of sales during the holidays, any one of the large brands outsold all of these smaller brands combined. And one of the biggest of the big was Panasonic, which has a huge stake in the plasma HDTV market.

The best-selling flat panel model last December was a Panasonic 42-inch plasma. The average selling price was just over $1,300. The fact is that Panasonic slashed prices across the board for the holiday season, and as a result, they literally sold boatloads of HDTVs. Why the price cuts? Maybe they had surplus inventory that they wanted to cash in. Maybe they wanted to strike back at the Olevias and Visios and Westinghouses who had lowered 42″ LCD HDTV prices to match or even beat plasma prices. Maybe it was a combination of these. Whatever the reason, the prices came down and the plasmas went out the door. And I believe that in the final analysis, it was Panasonic’s price cuts that drove down prices for everyone else: large and small.