Why I'm not ready to buy a High Definition TV

February 17, 2009. Does this date ring a bell? If you watch TV in the USA, it should. It's the date that the US government is requiring that TV broadcasters stop delivering their signal in an analog format over the airwaves. What does this mean to you? If you watch TV and subscribe to cable or satellite, it means nothing. If you watch TV via rabbit ears or other antenna, it could mean that your TV will stop receiving a signal on Feb 17, 2009. I won't go into the details, but you can read more about it here and here.

Why do I care about the February 2009 date? Because I currently have two analog TVs at home. They are great TVs, never had a problem. Am I going to replace them with high definition TVs (HDTVs) by February 2009? Unless one of them suddenly stops working, no. Am I going to subscribe to cable or satellite service? No, we don't watch that much TV (the local stations provide all the programming we need). Are we going to get converter boxes for our analog TVs? Yes. Why? The after coupon price of a converter box should only be around $20 per TV. This will allow my existing analog TVs to receive digital broadcasts before and after Feb 2009.

You may be asking the question: Why don't I just replace my old TVs with new HDTVs? One answer: Price. High definition TVs provide a great viewing experience, but in my view and as of the date of this writing, they are too expensive.

Let's rewind a few years to when DVD technology was introduced. When DVD players were an emerging market, there were only a handful of manufacturers that made DVD players. These companies set the manufacturer's suggested retail price (MSRP) for DVD players fairly high, which remained high for a couple of years. When DVD players began to became popular, other manufacturers jumped on board and began making cheaper players (see marginal cost pricing). They flooded the market with $20 and $30 players, and the original manufacturers were forced to reduce the prices on their low-end players to compete.

When you compare the early and expensive DVD players that were first on the market and the players that are sold today for $20, functionality is at least the same, and in some cases better than what was available a couple of years ago. If this pattern for consumer electronics holds true, I see large screen HDTVs dropping in price in the next two or three years. I expect the current and new HDTV manufacturers to sell large numbers of HDTVs before and just after Feb, 2009. Once that date passes, however, I see HDTVs becoming a commodity item like DVD players, with lots of optional features, lots of manufacturers to choose from, and much lower prices.

When the day comes that I can buy a 42 inch 1080p TV for a couple of hundred dollars, I may consider replacing one or both of my existing TVs. Until then, I'll keep what I have, thanks. :)