Wednesday, February 28, 2024

Everything seems expensive, so why is a big new smart TV cheaper than ever?

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(CNN) — In March 1973, electronics manufacturer RCA Corporation announced its “new, low-cost color television” in the New York Times. The 15-inch model cost $379.95 at the time, which is equivalent to $2,694.32 in today’s dollars.

These days — in an era of above-average inflation — everything from groceries to new cars can seem expensive. But one living room staple has defied high prices and become less expensive over time: the television. Today, a 32-inch TV—more than twice the size of an RCA TV from 1973—can be had for less than $100.

Did TV makers cut prices out of the goodness of their hearts? It’s tough.

Many factors have contributed to the emergence of cheap televisions, some related to manufacturing and others related to marketing. There is increased competition, a more efficient manufacturing process and stronger contract traction.

But more importantly, TV manufacturers have a lucrative new revenue stream: selling information about you. Today, most TV makers act as data brokers, profiting from the information they collect from Internet-connected customers.

Flat screens are faster

The uses of televisions and their appearance have changed. For decades a bulky piece of furniture, sometimes inlaid with carved wood, is now a thin, glossy black panel that sits on your shopping cart and hangs on the wall. Some current models are designed like a picture frame.

As the materials used to make televisions changed, so did the manufacturing process. One of the biggest advances in this process was a scientific development called “mother glass,” which enabled television screens to be made larger than ever before.

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Over time, TV manufacturers figured out how to cut costs by drilling multiple screens out of one large sheet of “mother glass” instead of making each screen individually, said Paul Gagnon, Sargana’s consumer technology division consultant for market research.

But this design also has a downside as there is an increased risk of these devices falling or breaking.

New players entering the market

There is another factor leading to lower prices: increased competition.

In the past few years, new companies have entered the US market with relatively low-cost offerings, increasing competition for older TV makers. Two of the most notable recent additions are two Chinese companies — TCL began selling TVs in the U.S. in 2014, and Hisense entered the market in 2015. Both companies have a growing market share worldwide.

DCL is widely available in department stores and is as ubiquitous now as Motorola or RCA were decades ago.

High quality TV features

Not all TVs are cheap, and most TVs offer some variation of LED technology. Devices with the highest picture quality, called OLED TVs, can still retail for thousands of dollars.

Who is watching whom?

Over the past decade, the television industry has undergone a major shift: A growing number of Americans no longer rely on traditional cable packages for entertainment. Instead, they get their entertainment from a crowded field of streaming services like Netflix, Max and Disney+.

In fact, according to Nielsen’s annual marketing report, Americans will watch more than 19 million pieces of content by 2022. Yes, 19 million years.

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These days, it’s hard to get a TV without the ability to easily access streaming content. These modern Internet-connected televisions are called “Smart TVs.”

Just as streaming services disrupted the cable business, TVs have changed the way TV makers do business.

“When we watch TV, our TVs watch us,” says Sarah Geoghegan, a consumer privacy advocate and legal counsel at the Electronic Privacy Information Center. “Smart TVs collect a lot of information,” he added.

The amount of data each TV maker collects can often be opaque, but once a customer sets up their smart TV, their viewing habits, location and personal data are collected and shared — unless that customer adjusts the device’s security settings, Geoghegan said.

This new business model changes the calculations for TV manufacturers.

The push for more data will encourage TV makers to lower prices, Gagnon said.

Not everyone is happy with the idea that a device mounted on your wall could collect information.

Geoghegan said many people would be embarrassed to learn that a spy gadget was one of the main reasons their new flat-screen monitor sold for $70.

Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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