Sticker shock -- in reverse

[Gregg Lengling]

01/17/03

WAYNE THOMPSON

Lost in the maze of last week's International Consumer Electronics Show in Las Vegas was an announcement from a Chinese company that could change the landscape for U.S. sales of video products.

Shanghai-based SVA, the largest brand name in consumer and computer electronics to come out of China, expects to compete successfully in the North American market with other major brands.

 

   
     
The company's stated goal: "To earn the kind of global status and reputation for quality products accorded Japan's Sony, Korea's Samsung and to Philips of The Netherlands."

To achieve that goal, SVA USA Inc. is offering U.S. consumers a complete line of television sets and an assortment of DVD players at prices that, in many cases, are hundreds of dollars under those of Japanese and European brands of similar quality.

The company presented an impressive lineup of digital and high-definition TVs that compare favorably with many of the so-called state-of-the-art TVs on display at the show, which drew 2,283 exhibitors and 116,687 attendees from 128 countries.

SVA's roster included a stunning 42-inch HDTV plasma screen, a series of LCD (liquid crystal display) monitors, ranging in size from 15 inches to 30 inches (measured diagonally), three models of pure flat-screen TVs, a DLP (digital light processing) rear-projection TV and a couple of angle flat-panel TVs.

Suggested prices for these TVs should produce sticker shock in reverse: They were notably cheaper than similar offerings in the Sony, Samsung, Panasonic, Toshiba, Philips, Zenith and RCA lines.

Moreover, the image quality and styling of SVA's television product line are vastly superior to other disparate brands that have come into the U.S. market to challenge industry leaders on price alone.

The best example of SVA's impressive quality is its flagship 42-inch high-definition plasma TV (Model HD4208TIII-PDP), which was on display at the show. It can produce full (1080i) high-definition images when connected to DTV decoders or other high-definition sources. The unit also includes a virtual surround sound speaker system that is more realistic than most we've heard.

The price: $3,888.88. Comparable 42-inch plasma sets by Pioneer, Philips and Sony cost thousands more.

SVA's DVD lineup also should stir up some sales in the U.S. market based on its low-ball price points. Its D-1000 DVD player is fully featured, not bare bones, at a suggested retail price of $64. Another model, the DP262, which includes progressive scan circuitry that enhances image quality when connected to an HDTV monitor, is expected to sell for $89.99 when it is introduced March 1.

At the SVA news conference, there were more questions than answers about its entry into the North American market and why it thinks it can win in the price wars that are sure to follow.

Ellen Xin, Oregon's trade representative in China, provided some of the answers in a telephone interview by saying that SVA was indeed a major electronics company in the eastern region of the country, piling up an impressive sales record in consumer and computer electronics.

"SVA is very well-known here. They have enormous resources, large plant capacity and a good reputation," she said. The company, she added, is government-controlled. Translated, that means SVA's North American strategy is blessed by China's foreign policy, which has been bullish toward globalization ever since China joined the World Trade Organization in December 2001.

SVA, the company acknowledges, also is boosted by a very cheap labor market and motivated to expand into a multinational power by the unprecedented economic growth in China and continuing U.S. investment there. (China recently stabilized its currency, the yuan).

Founded in the early 1990s, SVA had sales of $6.3 billion last year, including its broadband and computer business and its contract work for a variety of electronics industry partners.

SVA is one of the world's leading innovators in liquid crystal display technology. With its large plant capacity, the company has attracted strategic partners, such as Panasonic and NEC, for whom SVA manufactures products.

Its research and development investment is comparable to other major electronics firms worldwide, and its physical assets are worth an estimated $20 billion.

Given those resources and SVA's stated long-term commitment (it wants its brand name to be a household commodity by the time of the Summer Olympic Games in Beijing in 2008), the Shanghai company comes to America with confidence.

"Today, consumers look to Japan and Korea as top name brands for leading technology in all product categories," says Peter Calderone, SVA-USA's senior vice president of sales. "We want them to look at us in the future."

Initially, SVA plans to market its lineup through national distributors SED International, D&H Distributors and Quick Micro Inc. Some of its products already are being sold on the Internet by Amazon.com, Quick Micro Inc., MP Superstore, HardDrive.Com and Digitally Unique.com.

SVA expects to have its TV and DVD lines displayed very soon in Sears and Costco stores, and possibly in all Best Buy stores nationwide.

There is precedent for believing SVA will succeed. Three years ago, a California-based company, Apex, brought to market a product line of DVD players made in China at prices no other DVD maker could match. As a result, Apex has sold more DVD players than anyone else. SVA has the will, the means and the product line to be just as competitive.

Wayne Thompson is a Portland writer. You can reach him at mlou4jazz@aol.com.

[kjnorman]

Their plasma, while able to receive 1080i pictures, is not a true 1080i display - a little bit too enthusiastic marketing here..

The display is really an enhanced definition display with a maximum resolution of 853 x 480, similar to the display that Gateway is selling for $3,000.  Perfect for Fox 6.

The specification can be found here.