Monday, February 07, 2005

Darwin Meets the Cathode Ray Tube

Apparently, manufacturers of cathode ray tubes ("CRTs") are not going the way of buggy whips without a fight.

Fine -- that's exactly the way it should be. Faced with being left in the dust by the hot new thin screen technologies -- LCD and plasma (and even by the formerly derided projection screen technology) -- makers of CRTs had two choices: adapt or die. The second option is the easy way out, of course; simply fold up your CRT engineering and manufacturing operations, perhaps moving the resources over to the LCD or plasma sides of the house (the manufacturers cited in the article also have substantial LCD or plasma investments).

LG.Philips Displays and Samsung have opted to adapt, however, creating the "Super Slim Tube", which boasts technology reducing the depth of the unit to about 35 cm (roughly 9 inches for us Yanks). The goal inside 1 year is to reduce the depth to no more than 25 cm (about 6.5"). This would compare favorably with the 3" depth sported by many LCD and plasma units today. Industry experts believe that this depth reduction may be enough to allow the new Super Slim Tubes to compete with the thin screens, particularly since CRTs provide superior picture and performance. Whether the new tubes will meet market acceptance, however, remains to be seen. The upside potential, however, is quite high, particularly given the cost advantage of tubes over thin screens.

Adaptation is hard in business and in "real life". It forces you to think across the grain and, despite the best of intentions, is not always successful (think: "Wooly Mammoth"; it adapted well to the cooler climate of North America and Siberia, but in the end, humans were too much for it). In the end, though, adaptation through competition benefits everyone in the marketplace. Fifteen years ago, for example, the only practical use for thin screens was for the emerging laptop computer. In that span, however, not only has the thin screen technology has reached total domination of the laptop / notebook PC market, it has laid claim to much of the desktop PC monitor market and is now impinging solidly into an area where the CRT was once thought inviolate -- the living room TV.

Without that threat to its domination, the CRT would have remained as it always has -- big and clunky and relatively undesirable. Now, faced with imminent extinction, the CRT industry is adapting and the creativity unleashed as a result may ultimately lead to a more affordable AND better performing alternative for HDTV viewing, along with the slim form factor everyone craves these days. Even if the technology doesn't catch on, it is almost certain to drive the thin screen engineers to solve the problems that have dogged their products (viewing angle distortion and smearing of fast moving images -- particularly noticeable in sporting events and action movies). At the end of the day, we should end up with one or more products substantially better and cheaper than those available now.

The ultimate lesson is this: where economic competition (aka "capitalism") reigns, you can have your cake and eat it too! This is a lesson that can be (and has been successfully) applied to "products" as diverse as elementary school education (vouchers) to garbage collection (privitization). Its no wonder that, for all its flaws, our economic system remains the best the world has ever seen.

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