As yet another sign of the times, two well known players in the plasma HDTV market - Pioneer and VIZIO - have announced that they will stop offering plasma televisions in their lines effectively immediately.
Although Pioneer actually announced their exit from plasma manufacturing about a year ago, they originally stated they would continue to offer KURO plasma HDTVs by buying their panels from former rival Panasonic while continuing to add their "secret sauce" to the electronics and other components. They also announced (and even released in Europe) their first LCD televisions to sport the Pioneer KURO brand. Now all that changes, as Pioneer has announced that they will cease all TV operations by next year, a measure that will allow Pioneer to cut back 6,000 of its staff (16%) as well as 4,000 contract workers.
Although Pioneer televisions have received nearly uniformly high marks, in professional and consumer reviews, including our own review of their latest 50-inch model, the PDP-5020FD, the price premium associated with the Pioneer brand has kept them from attaining any significant share of the TV market. Pioneer will re-focus their efforts on areas of greater opportunity -- audio equipment, set-top boxes and mobile products -- in order to weather these stormy economic conditions.
Meanwhile on the other side of the cost spectrum, California-based VIZIO, known for their value-oriented products, has also announced that they will stop offering plasma models in their TV line, though they fully intend to continue offering LCD models, even expanding out to more advanced LED-backlit models in the coming year. Although VIZIO claims the decision to exit the plasma business was made due, at least in part, to LCD TV's appearing brighter on the sales floor, we have to wonder whether Panasonic's cut-backs in panel production and Panasonic's drastic price cuts in their own plasma models weren't also significant factors in the decision.
Although VIZIO generally doesn't reveal the source of its components, it is pretty well known in the industry that they were buying plasma panels from LG and, more recently, from Panasonic for their VIZIO-branded plasma HDTVs. If Panasonic is cutting back panel production then they may no longer be able to accomodate the demand from third parties such as VIZIO (and Pioneer, for that matter). And while VIZIO used to have an edge in pricing, VIZIO's 42-inch entry-level plasma HDTV model was actually selling for about $100 more than Panasonic's own entry-level plasma model this past holiday shopping season. When VIZIO can't compete on price, it's time for them to get out of the game.
In the grand scale of things, these two announcements may not mean much. The top three plasma makers -- Panasonic, Samsung and LG -- are still in the game, though each company also offers LCD models, particularly in smaller screen sizes. While we wait for OLED technology to fulfill its promise (and get larger than 11-inches in a production product), plasma and LCD flat panels will continue to battle it out for consumer's HDTV spending dollars.
