The Big Picture

The 'image' on the wall is clear. The digital projector,
from being an obscure boardroom device, has now become mainstream in the
peripherals market. Until a year ago, exorbitant prices had kept the digital
projector market a small niche in the peripherals space. But that's history
now. With price slides in the recent past, the 'affordability' factor has
increased. Today, all leading players have a slew of offerings in the sub Rs 1
lakh category. The home segment has also come into the radar. Agrees AK Harish,
business manager, Projectors, Epson India: "The projector technology has
evolved over the years and, as a result, the picture quality has inreased. At
the same time decline in prices has opened up the market in India."

Market Dynamics

According to IDC the total market size for digital projectors was 21,152
units for 2004. The top three players were NEC, InFocus, and Epson. In value
terms, digital projectors garnered Rs 237 crore during 2004. In terms of
technology, digital light processing (DLP) constituted 34% and liquid crystal
display (LCD) accounted for the balance 66%. In the DLP space, Toshiba was the
number one player. Among the two major resolutions available, SVGA constituted
47% and XGA 53%. Products in the digital projector market are spread across
three category of lumens: 1000—1500, 1500—2000 and 2000—2500. Weight is
also a key criteria and the market is divided on those lines also. For instance,
the projector weighing 2-3 kg constituted 50% of the total market in 2004. The
typical entry-level prices of DLPs were around Rs 97,000 while LCD projectors
vended at Rs 120,000 during 2004.

According to Sanjit Sinha, senior manager, Hardware Research,
IDC India, "With overall IT spending on a high in India, projectors are
expected to quickly become a part of the IT infrastructure investments in both
the corporate and government segments." Vendors also expect a growing
demand from the education segment. While there exists a huge potential in the
SMB and home segment, the growth rate will be slow given the gradual adoption by
the SMB players. The concept of projector—based home theatre system is still
in its infancy. While ASP declines would be very crucial to address these two
markets, vendors need to look at addressing these segments through a mix of
conventional and unconventional IT distribution channels. Technology innovation,
coupled with enhanced production, would drive down prices, as market and product
differentials gradually start moving away from product features to factors such
as service, ease of purchase, and price.

Vendor Strategies

The digital projector market in India is a highly fragmented one with
estimates pegging it close to 30 players. In terms of market visibility, players
like Epson, NEC, InFocus, Sharp, and Toshiba occupy the top slots. HP's recent
foray into the projector space has also made the market more competitive. HP in
Q2 2005 came out with a slew of digital projectors aimed at various buying
segments. HP's vp and mp series of digital projectors are priced between Rs
75,000 and Rs 190,000.

HP has come out with value additions like built-in DVD players
and in-built flash memory, which enable users to store presentations and beam
them without the aid of a PC. Says Manu Sharma, country category manager,
Imaging Products, HP India: "We have an innovative range of digital
projectors that come with state-of-the-art mobility and wireless features.
Verticals like education are doing aggressive buying, apart form big corporates.
The traction we are seeing in the projector space is due to the shrinkage of
end-user prices."

Meanwhile, Epson is also aggressively addressing the market with
its projector offerings. Recently, Epson showcased its proprietary 3-LCD
technology, highlighting its benefits over the DLP technology. The 3-LCD
projectors pass light through LCD panels about the size of a postage stamp and
then use the projector's lens to expand minute details within the images. Thus
the projector is able to reproduce a wide gamut of colors. Says Harish,
"Our latest projector, the Dreamio EMP-TW200H, targeting the home theatre
segment, is yet another model which is doing extremely well. With this
projector, a resolution of 1280x720 is achievable, brightness of 1500 ANSI lumen
and a contrast ratio of 1000:1. The projector uses a 0.7-inch wide LCD panel
with a full 10-bit drive." Epson has also come out with a postcard-sized
mini-projector, using an LED light source and a footprint of 13.8 by 10.3
centimeters. The 500-gram prototype can fit into the palm of a hand.

On the home side of things, vendors are targeting the upmarket
and techno-savvy professional who is tuned to a digital lifestyle. Says VP
Sajeevan, senior manager marketing, Projectors and Consumables, Canon India,
"Around 5% of   the total population has the
power  of  spending  for high-value visual products atÂ
home.  And this population is the target audience for our home
projectors. This is substantiated by the fact that today, a consumer
can use a Canon projector and connect to television via a
TV-tuner, besides accessing the DVD, digital camera, and laptop. This makes
usage easy and hassle free."

Clearly, digital projectors have outgrown their corporate-only
image and their volumes are increasing. Analysts see a buoyant growth path for
the digital projectors in the days ahead and, according to IDC estimates, the
digital projector market is expected to grow at a CAGR of 27% during the next
four years. While the bigger market right now is LCD, in time DLP based digital
projectors will gain ground. At the large enterprise level, the crash in end
user price points will enable this segment to go for additional projectors,
equipping all conference rooms with a projector. SMBs, which mostly rented out
projectors on demand basis, now own their projectors, in the bargain getting
more RoI as a rented projector come at over Rs 2k per hour.

As Epson's Harish sums it up, "The market in India will
continue to grow rapidly. Data projectors will become default in every office
conference room. Projectors will increasingly enter the home as a preferred
cinema viewing experience. Prices will come down further and picture quality
will get better even as projectors get smaller."

Shrikanth G
in Chennai

Projector Techs-Demystified

Liquid Crystal Display (LCD): Projectors based on the LCD
technology have three LCD glass panels for red, green and blue-commonly
referred to as RGB. The image is beamed onto the screen as light passes through
each of these panels.

Digital Light Processing (DLP): Different from LCD, the
DLP-based projectors use a high reflective surface composed of numerous micro
mirrors on the DLP chip with each mirror taking up a single pixel. There is a
lot of inbuilt intelligence embedded on DLP projectors as the color is managed
through a spinning wheel between the chip and the lens that determine the colors
hitting the mirror surface.

Liquid Crystal on Silicon (LCOS): Vendors like JVC and
Hitachi having already come out with LCOS based products. Experts define the
technology as a hybrid between LCD and DLP. LCOS combines reflective technology
as well as LCD, by applying liquid crystals on the reflective mirror. As light
passes, the liquid crystals open and close to create the image.