Mini-LED TVs - The Whole Enchilada
There have been a number of mentions in the trade press concerning the slow development of the Mini-LED TV market recently. Some are based on component availability, meaning LEDs and the Mini-LED modules themselves, and some are speculating that consumers are apprehensive about a new technology that has only been available for a relatively short time and is not quite understood by rank and file TV buyers. Looking at the component side, much of the consternation over shortages of Mini-LEDs seems to be coming from smaller LED producers and packagers, who are a bit more capital constrained that major LED suppliers such as Ennostar (3714.TT), Sanan (600703.CH), and Nichia (5393.JP) and given the larger numbers and smaller size of Mini-LEDs the cost of production is higher than generic backlight LEDs, but these are all issues that are common to almost every technology upgrade, which Mini-LED backlights certainly are.
In our view there are two obstacles facing the Mini-LED market, more specifically the Mini-LED TV market, and all are related to price. Not as much the price of the Mini-LEDs themselves, or the backlight arrays, but the price of the TV sets in which they are used. The price of Mini-LEDs will decline as competition from China increases, particularly from BOE (200725.CH), who has already staked a claim in the Mini-LED backlight module market by shifting to glass rather than PCB substrates for its commercial Mini-LED modules, which is an aggressive step forward in the development of the Mini-LED modules, but a necessary one if the market is to grow.
The bigger problems is Mini-TV set pricing itself which not only must absorb the higher cost of the Mini-LED backlight modules, but the advertising, development costs associated with Mini-LED modules, require larger driver and timing circuitry, and most importantly the TV brand’s desire to generate higher margins than those from generic LED backlit sets. In order to better understand Mini-LED TV pricing we have put together a table identifying 42 Mini-LED TV models, 37 of which are models announced or released this year. We have excluded any models that are no longer available, although we note that some models, particularly from Chinese brands, are not available in the US. The database looks at over 15 comparative features, although in the table below we leave out many such features that do not have to do with the physical aspects of the TVs themselves, such as which streaming services they support or sound systems. The abbreviated table below shows a subset of our data, and we note that TCL (000100.CH), the first TV brand to release a Mini-LED TV (2019), still makes available previous year models which we have included. All other brands and models are from this year.
That said, here is what the data indicates. The lowest priced Mini-LED set is the 55” TCL 4K (Model 55R646), which sells for $950. This compares with Samsung’s (005930.KS) two 55” sets (QE55QN90A & QE55QN85A) which sell for $1,550 and $1,400 respectively. Samsung does produce a 43” model (QE43QN90A) that sells for $1,300 but is currently in very limited production. The most expensive Mini-LED sets on an absolute basis are the Skyworth (751.HK) 86” 4K Q72 at $7,744 and the Xiaomi (1810.HK) 82” Extreme, which also sells for the same price. However when we look at the sets compared against the price/in2 of screen space, Xiaomi is both the winner and loser, with the abovementioned ‘Extreme’ 8K being the most expensive at $2.70/in2 while their 82” 4K ‘Master’ set is the lowest at $0.54/in2. With the Xiaomi sets to be made available next month, we expect the price of the ‘Extreme’ might see some revisions, but for those brands that have few offerings, the number of units sold will be almost irrelevant. The real battle here is between Samsung, LG (066570.KS), and TCL, with Samsung setting the pace with 16 models, LG with 6 and TCL with 5 (2021). Looking at the two TV sizes that are common to all three brands, TCL is again the lowest cost/in2 for both while Samsung and LG are almost identical.
We note as always that much of the competition between brands is feature based and that goes to a new level with Mini-LED TVs, with the number of Mini-LED ‘zones’ and the absolute number of Mini-LEDs the new battleground. Not all brands give out this information, sometimes because they don’t compare well or they don’t want to reveal such competitive information, but while the absolute number of Mini-LEDs is important to the set’s ability to reduce backlighting issues such as ‘bloom’[1], there are many other factors that can contribute to how well images look on Mini-LED LCD TVs. All in, the growth of the Mini-LED segment will be driven by how quickly component costs can decline, and how willing brands are to ‘seed’ the market with more realistic premiums. Consumers need to be incentivized to explore the benefits of Mini-LED TVs and those brands that are willing to offer sets at more realistic premiums will win the battle. Given that this is really the first year that there has been a more than one brand offering such TVs, while the press calls this year ‘the year of Mini-LEDs’, we believe the first year when competition really begins will be 2022.
[1] ‘Bloom’ – When LEDs in light areas leak into dark areas.
In our view there are two obstacles facing the Mini-LED market, more specifically the Mini-LED TV market, and all are related to price. Not as much the price of the Mini-LEDs themselves, or the backlight arrays, but the price of the TV sets in which they are used. The price of Mini-LEDs will decline as competition from China increases, particularly from BOE (200725.CH), who has already staked a claim in the Mini-LED backlight module market by shifting to glass rather than PCB substrates for its commercial Mini-LED modules, which is an aggressive step forward in the development of the Mini-LED modules, but a necessary one if the market is to grow.
The bigger problems is Mini-TV set pricing itself which not only must absorb the higher cost of the Mini-LED backlight modules, but the advertising, development costs associated with Mini-LED modules, require larger driver and timing circuitry, and most importantly the TV brand’s desire to generate higher margins than those from generic LED backlit sets. In order to better understand Mini-LED TV pricing we have put together a table identifying 42 Mini-LED TV models, 37 of which are models announced or released this year. We have excluded any models that are no longer available, although we note that some models, particularly from Chinese brands, are not available in the US. The database looks at over 15 comparative features, although in the table below we leave out many such features that do not have to do with the physical aspects of the TVs themselves, such as which streaming services they support or sound systems. The abbreviated table below shows a subset of our data, and we note that TCL (000100.CH), the first TV brand to release a Mini-LED TV (2019), still makes available previous year models which we have included. All other brands and models are from this year.
That said, here is what the data indicates. The lowest priced Mini-LED set is the 55” TCL 4K (Model 55R646), which sells for $950. This compares with Samsung’s (005930.KS) two 55” sets (QE55QN90A & QE55QN85A) which sell for $1,550 and $1,400 respectively. Samsung does produce a 43” model (QE43QN90A) that sells for $1,300 but is currently in very limited production. The most expensive Mini-LED sets on an absolute basis are the Skyworth (751.HK) 86” 4K Q72 at $7,744 and the Xiaomi (1810.HK) 82” Extreme, which also sells for the same price. However when we look at the sets compared against the price/in2 of screen space, Xiaomi is both the winner and loser, with the abovementioned ‘Extreme’ 8K being the most expensive at $2.70/in2 while their 82” 4K ‘Master’ set is the lowest at $0.54/in2. With the Xiaomi sets to be made available next month, we expect the price of the ‘Extreme’ might see some revisions, but for those brands that have few offerings, the number of units sold will be almost irrelevant. The real battle here is between Samsung, LG (066570.KS), and TCL, with Samsung setting the pace with 16 models, LG with 6 and TCL with 5 (2021). Looking at the two TV sizes that are common to all three brands, TCL is again the lowest cost/in2 for both while Samsung and LG are almost identical.
We note as always that much of the competition between brands is feature based and that goes to a new level with Mini-LED TVs, with the number of Mini-LED ‘zones’ and the absolute number of Mini-LEDs the new battleground. Not all brands give out this information, sometimes because they don’t compare well or they don’t want to reveal such competitive information, but while the absolute number of Mini-LEDs is important to the set’s ability to reduce backlighting issues such as ‘bloom’[1], there are many other factors that can contribute to how well images look on Mini-LED LCD TVs. All in, the growth of the Mini-LED segment will be driven by how quickly component costs can decline, and how willing brands are to ‘seed’ the market with more realistic premiums. Consumers need to be incentivized to explore the benefits of Mini-LED TVs and those brands that are willing to offer sets at more realistic premiums will win the battle. Given that this is really the first year that there has been a more than one brand offering such TVs, while the press calls this year ‘the year of Mini-LEDs’, we believe the first year when competition really begins will be 2022.
[1] ‘Bloom’ – When LEDs in light areas leak into dark areas.
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