Samsung to stretch the large format display market

Montreal – Partner Research, a channel market research firm based in Toronto, predicts that the market for large format display intended for digital signage will more than triple in the next 18 months.

While the market is growing rapidly, the digital signage market is still in its infancy according to Peter Bougadis, Samsung Canada’s sales manager – large format display, Digital IT division, based in Mississauga, Ont.

Samsung Canada has doubled its business in large format displays and currently enjoys a 17 per cent market share. The other main vendors in the market are LG Electronics, NEC Display Solutions and Sharp.

By 2010, there will be more than 70,000 total units sold in Canada, Partner Research reports. Just last year, large format displays accounted for only 20,000 unit sales.

Approximately 45 per cent of the digital signage market is for retail applications, IDC has found. The hospitality market accounts for 30 per cent. These are the two biggest areas for digital signage. Other markets such as government and medical are at five per cent each.

The growth in digital signage is expected to reach 30 per cent per year going well into the next decade, IDC said.

Bougadis said there are two reasons for this growth. The first is average selling prices (ASPs) have dropped dramatically and the second is that the market is finally understanding the technology behind digital signage.

“The market now understands that digital signage is a more cost effective solution than the cost for printing banners. There is also no wait time if you want to change your message with digital signage, whereas there are lots of incremental costs to changing a banner ad. You can change the content of the ad just by uploading it onto a server connected to the display,” Bougadis said.

With average selling prices coming down in large format displays by 15 per cent, Samsung is conscious of the fact they need to innovate to maintain price points on the 40-inch and above models along with reseller margins. To that end, the company has improved air flow and heat with an additional fan and there is better dust control for 20 to 24 hour operation, which is necessary for digital signage.

Digital signage today can be seen at gas stations, at The Gap with looped commercials, and at Wal-Mart for vendor point of sale. They are also in hotels for concierge information, restaurants for displaying menus and specials, at mall kiosks and at bars for video walls.

Samsung Canada has added more resources such as service, warranty, and sales support to support this business, especially in Ontario and Western Canada.

Samsung relies on its distribution partners Ingram Micro and Tech Data to help grow its channel in digital signage. Samsung Canada’s top partners in this area are Telus National Systems and Bell Business Solutions.

Bougadis said digital signage solutions project-based and usually have a long sales cycle. On average, these sales cycles are between six to nine months and can even stretch into two years.

Resellers interested in digital signage need to know how to partner with content creators and other companies that know how to manage networks.

“VARs that close these deals have a lot of work ahead of them. There is no down-time in digital signage. If there is a service issue with the customer it has to be addressed because if it goes down, it will mean a lost revenue opportunity,” Bougadis said.Currently, Samsung has seen a lot of channel partners outsourcing the content creation part of the digital signage solution and concentrate on the install and management of the network.

The margins in the hardware sale are not that much but can reach 20 per cent, he said, but there is plenty of margin in the value-added services surrounding a digital signage solution.

Bougadis expects a dramatic increase in the number of solution providers entering this market, and not just because the market is predicted to triple in size.

He added that the addressable market just on the retail side of digital signage is 220,000 establishments in Canada. This doesn’t take into account the many other opportunities in hospitality, government, medical, call centres, manufacturing, transportation and the corporate market with boardrooms.

Samsung Canada’s product strategy is to offer choice for every single application from plasma 42-inch to 63-inch displays. Bougadis said the sweet spot for plasmas has been hit. Plasmas does offer high quality, but it doesn’t fit all applications and is in decline compared to LCD, which is more in demand.

In LCDs Samsung has models starting from 32 -inches up to 82-inches.

Samsung, similar to Panasonic, also has a 100-inch flat-panel monitor, however this is a prototype and not ready for the market. According to Bougadis, the market is not there yet, but can be offered on a case-by-case basis.

Samsung’s entry level digital signage display model is the PX at 500 lumens with a 40-inch bezel. It also offers a DX and UX series with better lumens.

Would you recommend this article?

Share

Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.


Jim Love, Chief Content Officer, IT World Canada

Featured Download

Paolo Del Nibletto
Paolo Del Nibletto
Former editor of Computer Dealer News, covering Canada's IT channel community.

Related Tech News

Featured Tech Jobs

 

CDN in your inbox

CDN delivers a critical analysis of the competitive landscape detailing both the challenges and opportunities facing solution providers. CDN's email newsletter details the most important news and commentary from the channel.