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Vizio Proves Cheap HDTV Sells

by February 20, 2009

Some are hailing it as a sign of good-news in this foul economy! Vizio, maker of the sort of cheap HDTVs you’d find at Wal-Mart, is actually growing and breaking sales records. But the real success behind Vizio might be a variation of an old adage - if you build it cheap, they will come. Is Vizio a silver lining in the troubled economy or just another symptom of the downturn?

Vizio is turning into a powerhouse in the HD market. Unlike most businesses Vizio has experienced growth for the last two consecutive quarters. The company has recently put out a press release that boasts it is the second largest shipper of HDTVs in the US. Its sell-through increased 52% for the Holiday season from 2007 to 2008.

While it appears to buck the global economic trend - it’s also a troubling sign when a third tier vendor like Vizio tops the charts. It’s hard to say if it’s really bucking the recession (as cited by our friends over at EngadgetHD) or if this is merely another symptom.

Like Pioneer Kuro, Vizio has recently made the decision to exit the plasma panel market. It’s further evidence of doom for plasma as a display technology. But whether you’re Pioneer or Vizio, the decision to jump from Plasma is more about streamlining a business model than an indictment on a technology that is shrinking in popular favor.

The Trouble with Third-Tier Electronics

Before you get the idea that we're complete electronics snobs, let’s get one thing straight. There is nothing wrong with saving money on electronics. Audioholics.com has made its mark taking down some of the bold claims of many esoteric brands while happily recommending mainstream equipment for any purpose when it’s proven it’ll do the job.

When it comes to HDTV there are a variety of reasons you might want to go with the very cheapest you can find. Let’s face it, a lot of Vizio HDTVs are being snapped up by people who never thought they’d be able to afford one. But today, you might want to walk out of Wal-Mart and do some comparison shopping before you’re shocked into buying an $800 no-brand HDTV. The price differential between Vizio and familiar brands like Panasonic is wilting away like last week’s Valentine’s Day flowers.

Buyer Beware

When buying brands like Vizio and other retail house brands like Insignia, it’s good to know what you’re really getting into. These are known as third-tier brands. It basically means they’re companies that have almost nothing to do with manufacturing, quality control, warranty or any investment in their own brand name.

Tiers for Fears

Tier one are the familiar names you’ve all heard of. These include Sony, Toshiba, Sharp, Samsung, Panasonic and many more. All are great brands! There might be a little variation in quality between product lines from any of these companies, but all-in-all these brands have spent decades building a name. They’re generally involved in the design, engineering and marketing of their own products.

Tier two are brands that might have been. Usually they were once tier one but were acquired by a competitor - Zenith is now owned by LG, Magnavox by Philips. The company that owns them keeps them around to be a competitive line to specifically occupy a lower price point.

Tier Three are simply ventures. Many of them are from China or might be North American with ties to Chinese labor. A company can appear out of nowhere and buy up parts, auction off assembly contracts to the lowest bidder and voila – instant competitor to the big guys.

Few third tier ventures in electronics reach the heights of Vizio. But that doesn’t make Vizio much different than Apex, TruTech or the many no-name brands making those cheap monitors you see at generic computer stores.

These companies can appear, make a killing and then fade away at the first sign of a downturn. Since they have very little to do with manufacturing the build quality will be very inconsistent. Sure, you might take a home a gem with the Vizio name on it and have it last for years. But more than likely you’ll end up with problems soon after the initial warranty expires.

Buyer Beware

The numbers boasted by Vizio recently might be a good sign for this particular company. But we’d hesitate to start cheering the praises of the company itself. The only trend Vizio (and companies like it) are bucking is the ability to modify one very human trait.

It’s human nature to be attracted to the familiar. People and even whole families tend to form camps around a specific auto-manufacturer. They also say there is no place like home. People love what they know!

So, why would so many people take a chance on an unfamiliar knock-off brand of HDTV? I’d say Vizio’s success is less a sign of a strong corporation and more a sign of a company that’s deftly working a loophole. Sadly, it can also be read as a sign of desperation in many of its customers.

About the author:

Wayde is a tech-writer and content marketing consultant in Canada s tech hub Waterloo, Ontario and Editorialist for Audioholics.com. He's a big hockey fan as you'd expect from a Canadian. Wayde is also US Army veteran, but his favorite title is just "Dad".

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Recent Forum Posts:

rekced posts on March 05, 2009 15:42
swestbom, post: 528454
Ok, so this means you feel the same way about Oppo?


I had two of their players and both stopped working in a fairly short amount of time. While the first one was new I would recommend them to friends who were looking for the best up-converter available for a reasonable price. Two of my friends and my boss bought them based on my recommendation alone. A few months later I was at their house and the player was gone. I was like “where's the Oppo?”. Long story short, all three of the players quit working. My boss even received a replacement and that one worked for about 13 months total. Yeah, that does mean I feel that way about Oppo.

Eventually I figured out their helpful staff didn't have any first hand knowledge about electronics, as they would recommend a firmware update even when I was asking why the CD tray won't open. I was then emailed instructions on how to do it, which included burning a disk and putting it in the tray.
Dragon99 posts on March 04, 2009 15:31
Poor Article

Wayde Robson, post: 527669
Wow. Sorry you feel that way.

As stated in the article, it's very likely some people will have great experiences with Vizio. It's no surprise that some are finding them a fine quality set.

But they're a third tier enterprise – as such you can't expect the same commitment to quality as you’d find with company’s that actually research and use their own display technology.

I think people have a right to know how companies operate. Nobody is any less for having read about tiers in this industry, even if they disagree with my position that any third tier purchase represents an inherent risk.

If you love third tier enterprises keep reading… I’m doing some homework on another third tier company and what I'm finding might curl your toenails.

Whenever you find a product that can undersell its competitors chances are still that - You pay for what you get. The old adage hasn’t stopped being true.

This article has severely lowered my opinion of Audioholics. This website is supposed to be about pursuing the truth. Where are the facts proving tier 3 manufacturers make an inferior product? The only truth in the article is in the description of the 3 tiers of manufacturing, the rest if purely biased opinion and has no place here. Take yours opinions to the forums or make a blog. If you truly have research about a third tier company post that as an article.

This article was not up to the standard that Audioholics has set in the past.
treetownal posts on February 25, 2009 19:09
I purchased a 50 inch plasma P50 in early 2006. It had DCDi deinterlacing from Faroudja, the professional reviewers had given it higher marks on the technical tests than many sets costing twice as much, nice deep blacks and good detail. I have had no issues, no fan noise, and have never been happier with a TV set. I would compare my experience with my Vizio set to that of my Oppo DVD players.

I have heard less flattering, but generally positive, reviews of its LCD sets. My former roomate has bought two of their plasmas after watching my set and has had the same experience.
Wayde Robson posts on February 24, 2009 18:07
swestbom, post: 528454
Also, don't buy another car, the manufacturers are designers and assemblers, almost all the sub assemblies are from third parties.

Former Detroiter here. I have a lot of friends in the auto industry and I have a decent idea of how it works.

The Ford I drive was designed in Dearborn and I have exchanged messages with the community in a certain Yahoo! Group where they were answering questions. I know guys who worked at an assembly plant where seats were made for various manufacturers.

I realize some parts are outsourced, but it's not the same.
swestbom posts on February 24, 2009 17:27
Wayde Robson, post: 527669
Wow. Sorry you feel that way.

As stated in the article, it's very likely some people will have great experiences with Vizio. It's no surprise that some are finding them a fine quality set.

But they're a third tier enterprise – as such you can't expect the same commitment to quality as you’d find with company’s that actually research and use their own display technology.

I think people have a right to know how companies operate. Nobody is any less for having read about tiers in this industry, even if they disagree with my position that any third tier purchase represents an inherent risk.

If you love third tier enterprises keep reading… I’m doing some homework on another third tier company and what I'm finding might curl your toenails.

Whenever you find a product that can undersell its competitors chances are still that - You pay for what you get. The old adage hasn’t stopped being true.

Ok, so this means you feel the same way about Oppo? It is the same sort of set up. Also, don't buy another car, the manufacturers are designers and assemblers, almost all the sub assemblies are from third parties.
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