Hisense Says Its Branded U.S. Sales Will Hit $297 Million This Year

Hisense is broadening distribution beyond hhgregg and Walmart to include Amazon, which recently launched sales of Hisense’s Google TV-based GX1200V Pulse set-top ($99) and a 55T710DW 55-inch 120 Hz LED backlit LCD TV ($1,099). Both products were listed as out of stock Wednesday on Amazon. Hisense, having struggled to establish its own brand in the U.S. for eight years, is making a concerted push with the hiring earlier this year of former Panasonic executive Peter Erdman as its CE vice president for North America.

While Hisense will continue to supply OEM brands, including some of Best Buy’s Insignia private-label TVs, the company will draw 55 percent of its U.S. revenue from branded this year, Foist said. In addition to adding Amazon, Hisense also recently had supply talks with the NATM Buying Group, although no agreements were reached, Erdman said. “Maybe in the past the branded business was less of a focus, but it’s becoming more important now,” Erdman said. Hisense’s U.S. distribution is “still coming together,” but with top-tier Japanese brands struggling, Hisense sees an opening, he said.

To strengthen its hand in North America, Hisense is weighing opening a TV assembly plant in Mexico, with a final decision expected by year-end, executives said. Hisense TVs are currently produced in China, where the company sources components and operates its own plastic molding plant.

"Logistics and time to market” are the biggest reasons for adding a factory in Mexico, but “then again you have to look at the labor costs,” which are lower in China, Hisense Product Manager Chris Porter said. “There’s a tremendous amount of variables to go into balancing that solution."

In seeking to burnish its brand in the U.S., Hisense will make a push in 2013 with active- shutter 3D 50-, 58- and 65-inch LCD TVs with 4K screens. They'll feature a dual-core microprocessor, Android 4.0 operating system, detachable camera for facial recognition, gesture control, and services such as Skype. In introducing active shutter sets at the top end of its line, Hisense U.S. will forego for now the 60-inch glasses-free 4K LCD TV set its European subsidiary demonstrated at IFA with Stream TV Networks (CED Sept 5 p1). While Stream has said Hisense would bow the 60-inch model in early 2013, Erdman wouldn’t commit to shipment dates.

While Hisense has a “working relationship” with Stream for “ongoing projects,” the timing for delivering product hasn’t been set, Porter said. “If people are coming out with new technology, we obviously want to discuss with them what opportunities we have to incorporate that technology and bring it to market,” Porter said. “If a product comes out of that, fantastic, and if it doesn’t, at least we had that discussion."

Hisense has dabbled in several 3D TV technologies, having fielded both active-shutter and passive 3D TVs this year. It also has a partnership with Sensio to build its Hi-Fi 3D technology into stereoscopic TVs, including those that were expected to incorporate Sensio’s proposed 3DGO 3D video-on-demand service. Hi-Fi 3D consists of an encoder and decoder and combines subsampling with reconstruction algorithms that interpolate missing data to provide maximum fidelity to an original 3D image. While Hisense was part of the group to create a standard for active-shutter eyewear across multiple brands of TVs, it continues pressing on with its proprietary technology protocol for glasses, Porter said. “We are familiar with the spec and we've done work on productizing it, but as of today Hisense is using a third-party glasses supplier working with the Hisense protocol,” Porter said.

In 3D, Hisense currently fields the K560 series that features a 65-inch 1080p model with a 240 Hz frame rate, along with a 55-inch passive Internet-capable 3D model that has a 60 Hz frame rate. It also has the K316 series of Internet-capable 3D TVs that includes 42-, 46- and 50-inch models.

In branching into Google TV, Hisense is renewing its push with an Internet-capable platform. It previously fielded models with the Yahoo Connected TV platform, but has since discontinued them in the U.S., Porter said. Hisense continues to deploy the Yahoo platform with sets in Australia, Porter said. Hisense has worked on a Linux-based platform and has a software development group at its U.S headquarters in Atlanta, Porter said. With other companies fielding Google TV products, Hisense has focused on developing a user interface to differentiate its offerings from the competition. The UI features “larger landing pads” on the TV screen and comes with a keypad- and touchscreen-based remote control. “With the smart TV, we are not bringing a tremendous amount of new technology to the end user, but we are working on improving the speed and responsiveness of the system,” Porter said.