Flat panel TV numbers are looking up for Samsung Electronics the top selling LCD-TV maker in the world. Spurred on by a bold marketing campaign the company launched a line of new, pricy "LED-TVs." They carry a premium TV price with an "ultra-thin," and "low-power" message that hit a cord with consumers in spite of a worldwide pull back in spending.

Steve Sechrist
Senior Analyst and Editor

While LED illumination for TVs is not new, Samsung made a strategic decision in the Spring, to launch a new "class" of TV it labeled simply "LED-TVs" creating some confusion in retail channels (with reports that some sales people were insisting these were "NOT LCD-TVs") and the ire of some analysts. But the gutsy recession-bucking plan that included higher-priced LCD-TVs paid off in spades for the company as Samsung sold some 500K LED-TVs in the first 100 days of the mid-March launch, the company said. Industry analysts say they also dominated the high-end premium market with an 83% share of sets costing $3,000 or more each—up from just 4% a year earlier.

As a result, Samsung reported a five-fold increase in earnings for Q2 over Q1 with some industry analysts attributing up to 80% of that growth to the LCD-TV performance. That’s about $850M in three months, and three-quarters of the revenue, coming from the sale of those high-priced LED-based LCD-TVs. A recent Biz Week Asia article quoted Michael Min, an electronics specialist at fund manager Tempis Capital Management on the Samsung result: "Margins in TVs must have topped 10%," he says, "That’s like a hitting a home run."

But with LG and Sharp jumping on the bandwagon (Sharp launched five new models this week) some with significantly reduced prices, can the strategy hold for Samsung? One other factor that contributed significantly to Samsung’s bottom line had nothing to do with its TV marketing strategy. The Korean Won has been steadily falling against the US Dollar giving a kicker to the Samsung windfall. (Caution shameless self-promotion ahead…) We have a full write-up on this story complete with LED penetration numbers, MSRP price evaluation and details of what LG and Sharp are doing in the upcoming August issue of our Large Display Report, so stay tuned.