It is Russia. That is right – the same Russia that was in economic ruins for the entirety of the 90′s and most of the new millennium.
For contrast, in the US flat panel TV sales are stagnant in terms of numbers, and plummeting in terms of dollars according to recent reports:
In terms of dollars, U.S. sales plunged 15.4 percent from the same month a year ago. That reflects the sharp price declines that are pushing prices of some low-end models below $200.
October also saw the number of LCD TVs sold in the United States decline by 7 percent over October 2009. It was the sixth consecutive month in which 2010 sales have dropped below 2009 levels.
Amazing, isn’t it? The country that some thought was fading into a Third World economy in the chaos following the post-Cold War collapse, has seen a great resurgence – and one that has caught the West off-guard, as noted by Alexander Solzhenitsyn:
The West was celebrating its victory after the exhausting Cold War. While observing the 15-year-long anarchy under Gorbachev and Yeltsin and surrendering of all positions abroad, the West quickly got accustomed to the idea that Russia had become almost a Third World country and would remain that forever. When Russia began to strengthen its economy and statehood, the West perceived that, perhaps on a subconscious level, with panic.
Far from being a Third World nation, Russia is seeing a booming economy that has TV sales soaring – in spite of nearly all homes already having at least one TV set! This implies a luxury economy. Here are some more details:
While the affluent U.S. market lags, the appetite for LCD TVs is voracious in Russia, where 5 million units were sold last year. In 2010, analysts expect an 18 percent increase, to 5.9 million.
Never mind that 98 percent of Russian homes already have a TV, whether it’s the old cathode ray tube model or the new flat-panel box.
The 32-inch LCD TV is the most popular size in Russia, accounting for 43 percent of all shipments this year, according to analysts at iSuppli, a market research firm.
While 32-inch flat-panel TVs are expected to be available for $199 or less between now and Christmas in the United States, the Russians aren’t so lucky.
The average price of an LCD TV in Russia this year is expected to be $726, up 7 percent from last year. That compares with the Russian citizen’s average monthly income of $536.
Here is a graph from iSuppli showing the trends in Russia over the past few years projected out to 2014:
So not only are sales numbers booming in Russia, but the price per set is actually INCREASING, whereas in most other regions it is dropping rapidly.
It is too early to tell if this is a by-product of the combination of the Russian market maturing with an over-supply built up earlier this year based on better than expected sales over the winter in the rest of the world. But one thing is sure – change is everywhere, and settling into assumptions and expectations of ‘sameness’ is something businesses cannot afford to do anymore!