Samsung Electronics' position, which has dominated the global TV market for nearly 20 years, is being shaken. The company has fallen to 4th place in sales for its premium liquid crystal display (LCD) TV "mini LED TV" segment, losing ground to Chinese competitors.
Chinese companies, which have prioritized price competitiveness and large screens, are rapidly closing the technology gap, leading to an evaluation that Samsung's quality advantage is no longer solid. Consumers who previously chose the brand premium of Samsung and LG are now saying, "If the picture quality difference is not significant, I will choose a larger and cheaper product," indicating a gradual transfer of leadership in the premium TV market to China.
◇ Faded 'Samsung premium'… Market share of premium TV plummets
According to market research firm Counterpoint Research on the 25th, Samsung Electronics recorded 4th in sales and 3rd in revenue in the global mini LED TV market for the first quarter of this year. After leading this market until 2023, Samsung's ranking has plummeted within a year, overtaken one after another by Chinese TV companies TCL, Hisense, and Xiaomi. Mini LED TVs are premium products equipped with thousands of smaller LED backlights than conventional LCD TVs, improving brightness and contrast.
Looking at the overall premium TV market, Samsung's decline is evident. In the first quarter of this year, Samsung Electronics' market share (in terms of sales) in the global premium TV market fell sharply from 39% a year ago to 28%, a drop of 11 percentage points (P). LG Electronics also fell from 23% to 16% during the same period. Chinese companies TCL and Hisense rapidly seized this opportunity. Hisense's market share increased from 14% to 20%, while TCL rose from 13% to 19%.
The decrease in market share across the entire premium TV segment signals that both price competitiveness and quality superiority are being shaken. Industry analysis indicates that the stereotype that Chinese TVs are of inferior quality has largely crumbled. An industry insider noted, "It is now widely accepted that Chinese companies have improved their technological capabilities," adding, "Consumers are comparing actual screens and concluding, 'If Chinese TVs can achieve this level of picture quality, it’s excellent,' which removes the reasons to stick exclusively to Samsung products."
◇ China, with large screens and cost-effectiveness, has strengthened its technology… Samsung's strategic dilemma
The rapid advance of Chinese companies can be attributed to a 'large screen and cost-effectiveness strategy' based on elevated technological standards. By dominating the large LCD panel market, a core component of mini LED TVs, Chinese firms have secured pricing and supply chain leverage to provide large screens relatively cheaply. TCL has achieved vertical integration through its subsidiary CSOT, a leading global manufacturer of LCD panels for TVs, and Hisense has established its production system based on its domestic supply chain.
In this situation, Samsung Electronics is focusing on organic light-emitting diode (OLED) TVs, a path not chosen by Chinese companies. Chinese firms view the profitability of the large OLED TV market as low and have thus not entered it. Having re-entered the OLED TV market three years ago, Samsung aims to become the 'No. 1 in the OLED TV market' and is expanding its lineup. Some analysts view this as a response to securing differentiated technology and revenue after ceding LCD panel pricing authority to China.
However, the direction of the market is unfolding contrary to Samsung's strategy. The shipment volume and revenue of mini LED TVs have already surpassed those of OLEDs since the second quarter of last year, and since then, the share of the ultra-premium market has been increasing. Bob O’Brien, a research director at Counterpoint Research, analyzed, "Consumers are confronted with a choice between 'smaller OLED TVs' and 'larger mini LED TVs' at similar price points, and more and more consumers are opting for mini LED TVs."
To overcome this dilemma, Samsung Electronics is emphasizing artificial intelligence (AI) TVs. Beyond competition over the types and sizes of TV panels, the company aims to shift the competitive landscape by enhancing picture and sound quality through its proprietary AI processor. However, this AI differentiation strategy is not exclusive to Samsung. Competitors such as TCL and Hisense are also launching products equipped with their own AI chips, narrowing the technology gap.
An industry insider remarked, "In the past, Samsung broke Sony's dominance in cathode ray tube (CRT) TVs with 'large screen LCD TVs.' Now, China is reproducing this with 'large mini LEDs' against Samsung," and added, "As it is a time where quality is fundamental, and larger screens with reasonable prices must be combined, it would just be a matter of time before the throne held for 20 years changes hands if swift transformation in accordance with the rules of the game does not happen."