Shapiro: "Beginning of the End"

Consumer Electronics Association (CEA) president Gary Shapiro has pronounced 2003 as "the beginning of the end" for the transition from analog television to its digital successor.

Shapiro, speaking at the eighth annual HDTV Summit held in mid-March in Washington, DC, may have been a bit premature, given that only five million DTV products have been sold to American consumers. There are over 98 million TV-equipped homes in the US, which indicates that DTV has a long way to go before it achieves even 10% market penetration. "The end of the beginning" might have been a more apt description.

Nonetheless, Shapiro had reason for celebration. Broadcasters are ramping up their HD offerings, and the more they offer, the more reason consumers have to get on board. ESPN recently announced the launch of a high-definition sports channel guaranteed to hook more viewers than ever before. Such broadcast offerings, and a 50% drop in prices of DTV products, will combine to prompt new product purchases from those who didn't get catch early-adopter fever. Over-the-air HD programming now reaches 98% of the US population, he noted. The next hurdle is to get cable providers to supply digital signals.

The future looks bright for manufacturers and retailers who emphasize DTV, said CEA research director Sean Wargo. The CEA projects DTV sales of almost four million units this year—most of them high-definition television sets. Sales at that level will "bring us to almost 8% penetration of DTV by the end of the year," Wargo said. Consumers will have spent over $15 billion on DTV by the end of 2003, he noted, adding that the number could reach $20 billion counting the sale of "ancillary devices such as set-top boxes." Approximately 12% of TV sets sold in December 2002 were digital, a percentage expected to rise as high as 30% by the end of 2003.