Vizio Becomes No. 2 Flat-Panel TV Vendor In U.S. - InformationWeek

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Vizio Becomes No. 2 Flat-Panel TV Vendor In U.S.

The low-cost Vizio brand surpassed Sony in the fourth quarter of 2008, signaling consumers' recent preference for value above features in home theater equipment.

Vizio in the fourth quarter of 2008 surpassed Sony to become the second-biggest seller of flat-panel televisions in the United States, a market research firm said Friday.

The low-cost Vizio brand accounted for 14.3% of shipments of flat-panel TVs, including LCD and plasma, up 3.11 percentage points from the third quarter, iSuppli said. Premium brands Sony and Samsung Electronics, on the other hand, saw their market shares drop 0.42% and 0.62%, respectively.

Sony's share fell to 13.5%, placing the consumer electronics vendor in the No. 3 spot. Samsung remained the U.S. market leader with a 20.2% share. Vizio posted the second-best performance on a percentage basis among the top-five vendors in the quarter, surpassed only by the No. 4 brand Panasonic. The latter company saw a 3.12% rise in shipments.

"Vizio's success in the fourth quarter was partly due to increasing brand recognition, courtesy of the company's strong marketing efforts and retail strategy," iSuppli analyst Riddhi Patel said in a statement.

The cornerstone of Vizio's selling strategy is Wal-Mart stores, the world's largest retailer, iSuppli said. U.S. consumers in November and December bought more TVs at Wal-Mart than at Best Buy for the first time in the two years iSuppli has been tracking flat-panel shipments.

"This is an indication that in the present tough economic climate, consumers are becoming less brand conscious and prefer televisions that they perceive to have good picture quality and that are less expensive compared to the competition, rather than seeking models with a lot of extra features," Patel said.

Among the features being added to digital TVs is the ability to connect to the Internet. Toshiba, for example, is using Yahoo software and Intel processors to enable customers to access movies, music, sports, and other content from the Web. LG Electronics is making movies and TV shows available through Netflix's online rental service.

The U.S. TV market has been hit hard by the economic downturn, as a result of people curbing their spending. In addition, price competition has stiffened, resulting in some brands finding it difficult to survive.

LCD-TV maker Olevia filed for bankruptcy in 2008, and its products are no longer available, Patel said. Pioneer has announced its exit from the TV market.

ISuppli expects a few more value brands to disappear this year. "The brands that survive will be the ones that either own or have very close ties with the LCD and plasma panel makers, allowing them to keep their costs down," Patel said.

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