Originally Posted by Ken Ross
Fafrd, any thoughts on the pricing of the 77" LG ($25K on BB Canada)? Granted Canada is often higher, but it seems a lot higher than most were projecting.
Yes, a few thoughts:
All those prices (both 20K pounds in the UK and $25K in Canada) are old, they are not new news and so I don't put much weight on them.
Also, these prices are 'leaked' MSRPs or something. The MSRP of the 65EC9700 is $10,000 yet we are pretty sure it will be available for street prices a bit over $6K.
The 'old' view was that the 4K LG OLEDs were going to cost an arm and a leg. Then the 55EC9300 was actually launched at street prices that caught everyone by surprise. Then there were indications of street prices on the 65E9700 that were far lower than anyone had been expecting (and consistent with the aggressive pricing of the EC9300).
So my view is that it is not worth paying any attention to MSRPs and the 'official' prices - these prices are communicated to make consumers believe these OLEDs are high-priced luxury items affordable only by the rich and famous, so that when they can be found at steeply-discounted street prices with reach of everyman, that everyman thinks they are getting a real steal.
Focusing on the facts, here is what I see:
1/ LG has introduced the 55EC9300 at aggressive US street prices ($3000-3500) and every indication is that that launch is going well (far more customers now than there was even three months ago - just look at the traffic on this thread :-)
2/ Indications are that the 65EC9700 will launch at US street prices that are equally as aggressive ($6250-7000) and this will be the next data point that will hopefully materialize soon.
3/ The M2 manufacturing line is now up and running and as it approaches full capacity, it means that LG will have to sell a very large volume of OLEDs (relatively to the past 9 months). We are talking about over 4000 55" OLEDs per day
4/ LG has probed the market elasticity of pricing for 55" 1080p OLEDs over the past 9 months and discovered that in the pricing range between $2000 and $3500, they can drive significant increase in demand in the US market - and that pricing range is consistent with the pre-release street pricing that has been leaked for the 65EC9700 (half as many 65" panels per sheet = double the price). Assuming there is no 77"-specific yield problem, a sub $10,000 street price for the 77EG9700 (or 77EC9800 :-) would be consistent with per-sheet revenue being generated by the 55EC9300 and 65EC9700.
5/ The 'official' pricing being posted now is just for show and to keep LGs options open (and to generate surprise from the marketplace when true street pricing is actually released close to launch time) and so I can think of only three reasons that actual launch prices here in the US are anywhere close t these $20K+ numbers:
a/ the 77EG9700/77EC9800 is not really ready or prime time and LG doesn't really want any number of consumers to purchase them until a follow-on is introduced (2015?)
b/ LG is selling all of their M2 capacity based on sales of the 55EC9300 and 65EC9700, doesn't really need to sell any 77EG9700/77EC9800 to absorb fab capacity, and so wants to extract more margin and a 'luxery tax' from those few consumers ready to pony up for the biggest and best TV in the world (which would be completely bone-headed at this early stage of the market, in my view)
c/ there is some 77"-specific yield problem that truly makes the 77EG9700/77EC9800 much more expensive to manufacture than 3 55EC9300s of 1.5 65EC9700s - LG really does want to sell them but cannot afford to do so at prices consistent with those of the smaller panels (a nuance on reason a/ above).
I know it's tough, Ken - you don't know if you'll be buying this year or next :-) All indications from the Tea Leaves look promising, but only LG knows the true situation and so we'll need to sit tight and see how it all unfolds. If the 65EC9700 does actually launch at the pre-release pricing that has been indicated, that would be very positive. And continued uncertainly and FUD regarding the pricing of the 77EG9700/77EC9800 until then is nothing to be concerned about and is probably even a positive (meaning LG is keeping the possibility of a surprise before Christmas alive :-)