SIGNALS

Remember when flat-screen TVs first appeared? Whoa! That was the coolest thing ever! They were so flat! And so big! We couldn't get rid of our CRT TVs fast enough. We all bought them. Then when the prices dropped, we upgraded to bigger and better ones. Now we all have really nice TVs. So, are you planning to buy yet another new TV this holiday season?

At a recent CES Unveiled event in New York, Shawn DuBravac, chief economist and senior research director of the Consumer Technology Association described the results of a poll of over 1,000 adults. The results suggest that almost everyone who wants a nice TV already has one. Thus, projected sales of TVs look relatively dim.

The good news: Seventy-four percent of the gift-buyers surveyed said they plan to buy consumer electronics (excluding accessories) as holiday presents. The bad news: Only 17 percent of video buyers plan to buy a TV. Even with lower prices and better tech now available, that's down from 24 percent last year. So, if they're not buying TVs, what are people buying? In part, they are switching to lower-cost audio, mobile, and so-called emerging tech products such as drones, smartwatches, and smart thermostats.

In particular, here's what the polled buyers want:

• TV (17%)
  
• Digital camera or camcorder (22%)
  
• Aftermarket automotive (22%)
  
• Smartphone (24%)
  
• Gaming product (26%)
  
• Emerging tech (33%)
• Audio (52%)
• Computing device (53%)

Those figures don't tell the whole story. Although relatively few people are buying TVs, their relatively high prices still yield a sizable dollar volume. TV sales will bring in $18.6 billion this year. But, that's lower than the $53.6 billion in smartphone sales, and $22.6 billion in tablets, and about the same as laptop sales at $17.8 billion.

The problem is this: People are more interested in new stuff like drones, or else keep buying new phones because of the irrational need to always have the latest model. TVs, in contrast, have longer life cycles. People generally replace them when they break, or when a much better TV becomes available. TV manufacturers are pushing 4K TVs and curved screens, but apparently that's not enough to keep sales up.

Eighty-four percent of households already have LCD TVs, and if they're satisfied with them, they won't buy more. TV manufacturers are mainly banking on 4K to drive the next wave of sales, and sales of 4K TVs should hit 4.5 million units this year, up strongly from 1.4 million units the year before. But that's still a relatively small number.

The reality is that TV is now hitting the plateau that audio hit several years ago. The quality is quite good and most people are content with that. Sure, higher-res/high-dynamic-range screens, like higher-res audio, will appeal to some buyers, but growth will be more evolutionary than revolutionary. Meanwhile, the consumer pie is only so big and the dollars flow to whatever grabs people's attention. Since they've checked "I have a good TV" off the list, they'll look for some other shiny thing to buy.

That's why, when you look under the tree this year, you'll see more phones and drones than TVs.