Thanks to companies like Vizio and TCL, TVs are better than ever, fully equipped with internet access, built-in streaming services, beautiful image quality, and thin frames. Yet, prices are dropping at extraordinary rates. 65-inch 4K smart TV with HDR capability can be purchased for less than $500, which is remarkable considering $3,000 was considered very low for a 42-inch plasma screen in 2005.
According to Business Insider, any manufacturers collect data about users and sell that data to third parties, which explains the low prices of such large and durable pieces of equipment. This data would disclose the types of shows you watch, which ads you watch, and your estimated location.
Vizio’s chief technology officer, Bill Baxter, explained to The Verge’s podcast, Vergecast, that their strategy invokes a mindset in which they don’t focus on the money they are making at the initial sale, but rather how they can continue to make money off a consumer post-purchase.
“The greater strategy is I really don’t need to make money off of the TV. I need to cover my cost,” said Baxter. “It’s not just about data collection. It’s about post-purchase monetization of the TV.”
Now that the televisions themselves naturally intertwine with the internet and advertising, there are quite a few ways that they can be monetized after the TV has left the store.
“You sell some movies, you sell some TV shows, you sell some ads, you know,” he said. “It’s not really that different than the Verge website.”
Without that extra revenue stream from services like advertising, Vizio and other manufacturers would undoubtedly be selling their TVs at much higher prices. And with advertising comes market research, meaning that companies are paying attention to what you watch and what they should market to you next.
Vizio recently announced plans to release its best 4K HDR TV models in 2019.