The price of flat-panel displays in Hong Kong is expected to fall as much as 20 per cent this year, with the decline driven by strong demand and higher production capacity. Samsung Electronics Hong Kong general manager Steven Yu Kam-hon made this forecast at the launch of its plasma and liquid crystal display-thin film transistor (LCD-TFT) televisions yesterday. Samsung has strong competition from the likes of Sony and Fujitsu, but the company is aiming to raise its profile in the flat-screen television market, which Mr Yu expected to grow more rapidly in the SAR than in most other markets. 'We estimate the TV market in Hong Kong is around 200,000 to 220,000 sets per year. And the proportion for the flat screen, whether it is plasma or TFT, accounts for 20 per cent and this number is increasing rapidly. So in two years time in 2004 it will be 80 per cent. That's our estimation,' Mr Yu said. Plasma screens have been on the Hong Kong market for about five years, and when Chek Lap Kok opened in 1998, prices on the 42-inch models were about HK$100,000. Now similar displays cost about HK$35,000 to HK$40,000 and were finding their way into Hong Kong living rooms, Mr Yu said. The plasma screens cost at least 50 per cent more per square inch than cathode-ray-tube (CRT) televisions, but despite the economic slump, the price difference had not slowed demand, he said. 'It doesn't affect much, which is very strange, something we didn't expect. But in the area of household appliances, refrigerators and washing machines, all these, the retail sales figures keep dropping,' Mr Yu said. Samsung has seen a 20 per cent year-on-year rise in its flat-panel products, and he said the market for consumer digital products was still strong. An International Data Corp estimate from April forecast that retail consumers will buy 15,000 plasma televisions this year. Mr Yu said home consumption accounted for 40 per cent of the plasma TV market in Hong Kong, compared with about 10 per cent in markets like the United States. LCD-TFT televisions were new to the market, Mr Yu said. Production at Samsung and rivals such as Sharp and Sony have shifted towards LCD-TFT and plasma-display televisions in the past few years, but the former intends to keep some of its traditional CRT production in China and Mexico open to serve emerging markets. Mr Yu said he saw a parallel developing with the LCD computer monitor market, which had a sudden price drop last year, leading to rapid take-up of flat-screen computer monitors. He estimated 80 per cent of monitors bought in Hong Kong were now flat screens. 'All of a sudden, five of the manufacturers in Taiwan started their production at almost the same time - in May last year - so prices dropped dramatically,' Mr Yu said. He expected the same to happen for plasma and LCD televisions as production lines began operating. A handful of firms that supply the industry globally still manufactured panels for plasma screens, but Mr Yu said he expected the higher yields from increased production capacity might help bring prices down a further 20 to 25 per cent next year. On display yesterday were a 63-inch plasma television, which will start selling in October, and a 40-inch LCD-TFT television, both the largest of their kind to date. Sanyo, NEC, Aiwa and Hitachi are some of the other manufacturers targeting the flat-screen television market. Samsung, based in South Korea, has been staking out a position in digital home products and has been in negotiations with Hong Kong developers on home networking projects. It is also demonstrating products such as Internet-connected refrigerators and a fingerprint-based security system for the home. Mr Yu said the fingerprint system, which recognised an owner and automatically switched on a home's appliance settings, would be used in a Hong Kong luxury residential project next year, but the refrigerator would probably draw less demand. 'It's not a consumer piece at this point. But still no one would like to have a fridge like this in a small kitchen. They don't see the benefit of this,' Mr Yu said. He declined to name the property developers but an announcement might be made by the end of this year.
