3-D television sets may be selling like hotcakes, but it's not because consumers actually want to use that feature. What was intended as a major selling point for high-end TVs has become more of an afterthought, a feature you sort of assume will be there even if you never intend to use it. It's like the ashtrays in a 747 or the off-road handling features of that shiny new SUV in your driveway.
This stuff works in the movie theater but not the living room. Short of inventing a 3-D technology that works from any angle without goofy glasses, the electronics industry simply can't convince us that the third dimension is worth the trouble -- or higher prices.
So the home electronics industry is trying again, this time with smart TV sets and set-top boxes.
The CES show this week will feature dozens of Internet-connected living room gadgets. It's not exactly a new trend, as DisplaySearch reports that 21% of all TV sets sold last year had an Internet connection. Yahoo! (Nasdaq: YHOO) has been shipping software widgets for TV sets and cable boxes for years under the Connected TV brand. You might have that software platform installed on your new TV, Blu-ray player, or perhaps even the cable box without ever noticing. Google (Nasdaq: GOOG) and Apple (Nasdaq: AAPL) both launched high-profile networked media solutions last fall; the jury is still out on how well they are doing.
But again, pundits are left scratching their heads and wondering whether anybody actually uses these high-speed data connections. For one, you need to either pull Ethernet cable or know how to manage a wireless network around the house in order to get anything working. For another, even leading online video provider Netflix (Nasdaq: NFLX) sports just 20 million users these days, which is a drop in the ocean next to the 210 million TV sets sold worldwide in 2010.
LG Electronics research VP Baeguen Kang calls smart TV "an inevitable trend," and even Verizon consumer strategy VP Shawn Strickland concedes that "cord-cutting will happen."
I am living proof that it can be done, replacing traditional cable subscriptions with Roku boxes and your favorite gaming console. DisplaySearch sees a pretty timid growth curve for this technology, not much more than doubling by 2014. I don't think most consumers are ready to pay a premium for online video tools just yet, but the content is getting stronger day by day and the hardware is sneaking into our living rooms whether we want it or not. You can bank on this trend over the next five years.
