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TV Sales Slump Translates to Cheaper TVs This Holiday

Stocks in this article: BBY SNE P NFLX

NEW YORK ( TheStreet) - What gadget is topping consumer shopping lists? (Hint: It's not a tablet.)

It's a TV, according to a study by the NPD Group, a market research firm that tracks consumer purchases.

Sure, tablets, smartphones and video game consoles ranked high on shopping lists, but flat-screen TVs are the most anticipated consumer-electronic purchase, with 28% of people planning to buy one within two years, compared to 20% who plan to buy a tablet.

Ben Arnold, NPD's director of industry analysis, said it may seem surprising that such a mature product category tops the list. But TVs are perhaps the most ubiquitous household electronic device -- he estimates 99% of U.S. households own one. At any given moment, more people will buy a new TV than, for example, a sound bar.

But the other big reason consumers still have a TV on the brain: falling prices on LCD TVs.

"The idea that TV prices are continually falling and becoming more affordable has become part of the consumer psyche over buying TVs. And I'm sure that a lot of consumers wait until Black Friday, when they expect prices to be the lowest. I also would add that we've seen a real move into big screens, and increased affordability is a huge part of that," he said.

Other forces are at work to help prices plummet: LCD glass is getting cheaper due to an oversupply. Glass-panel factories in Asia overestimated demand and slowed production this year, according to Sweta Dash, senior director of display research and strategy at IHS iSuppli. This translates into an oversupply, meaning lower TV prices for consumers worldwide.

"Given the slow demand, panel makers reduced utilization rates for their fabs to 79% during the first half (of 2013), 5% lower than the average recorded during the second half of 2012," Dash said.

Dash says there will likely be some excellent deals on LCD TVs this holiday season.

"We are forecasting about 9%-to-10% price reduction for 32-inch panel from last year second half to this year second half," she said. She predicts a 32-inch LCD TV will be selling for around $133, compared to last year's $148.

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