Monday July 13, 2009 – Myra Moore
So, now that we’ve checked off the U.S. analog TV shut down from the giant DTV “to do” list, we can declare the U.S. DtA converter box market dead. Right? Well, not exactly.
The shut-off occurred a month ago and our data indicates that plenty of people are still buying the boxes. Before the boxes started selling, DTC estimated that more than 30 million converter boxes would ship into the U.S. over the life of the coupon program. Other forecasters estimated fewer would ship. And it turns out we were right (although a little low).
Our quarterly converter box tracking service estimates that about 30 million boxes shipped through 2008 with another 7 million shipped in the first quarter of 2009 (http://dtcreports.com/documents/converterboxtrackingwebsite2.pdf). We’ve got analysts shopping for converter boxes all over the country and retailers report sales are still strong. When I popped into my local Radio Shack last week, the Shack folks were opening a new carton of Digital Stream converter boxes and restocking the shelves. When I asked if people were still buying the boxes now that the shut-off is over, I got the “why do you think we’re restocking the shelves?” look – along with a spirited sales pitch.
Source: DTC
Less well-known consumer electronics brands like Digital Stream took a gamble when they designed boxes, got them certified and hit up major retailers for a slot on the shelf. It’s a one-time market and box margins are low. But the combination of acquiring real estate in a big retailer’s store (albeit temporary) and the rising interest in value brands that this nasty recession has produced may pay off. A little increased brand awareness and a foot in the door at Wal-mart or Radio Shack might lead to orders for portable DVD players, TVs, or, who knows, more converter boxes.
