By Chris Connery,

The world’s biggest retailer Walmart is on the minds of many in the FPD industry as it continues to grow as a major outlet for FPD TVs as well as other consumer electronics products. Equally important is how it goes about merchandising these products. In an announcement (finally) made earlier last week, Walmart announced a refresh to its in-store digital signage network now dubbed Walmart Smart Network. Walmart is often stated by many to be the US’s fifth largest TV network (behind NBC, ABC, CBS and FOX) due to the foot traffic of Walmart with “120-130 million viewers a month” often mentioned. This upgrade to the existing Walmart TV requires new Digital Signage displays, which is great news for the industry.

The roll-out was publicly stated to include 27,000 Public Display/Digital Signage solutions over a two-year period. The integrator is the US’s largest provider of Digital Signage, Thompson’s PRN (Premier Retail Networks http://www.prn.com/) which has recently struck a deal with display provider Planar.

Figure 1 Examples of PRN’s Current Solutions for Walmart: 15”, 42” and 57” LCD Displays

The world’s largest retailer’s a major initiative to roll-out a significant number of Digital Signage displays is excellent news for the Public Display market (as the FPD market continues to look for that “next big market” beyond FPD TVs). However, the details of the roll-out from the supply-chain side may cause many of the top brands and panel vendors to re-evaluate either their pricing or their product strategy.

Indications from Taiwan reveal that Planar’s back-end partners for this roll-out will be Taiwan’s Chi Lin Technology, providing OEM support and integrating LCD panels from CMO. For smaller sizes like end-cap displays, Planar may rely on one of its typical OEM partners for its monitor/public display business, Coretronic, but this will only be for 15” XGA sizes, which are slated to use “typical monitor panels,” some with touch panels.

Of greater interest to the FPD producers within the Digital Signage industry is the fact that the larger size LCD displays—42” and 57” panels—will come from CMO. Since Chi Lin is a CMO subsidiary, then the vertical integration was seemingly selected to help keep costs down. What may come as a shock to many in the FPD industry is that CMO (one of the leading Taiwanese large-area LCD panel producers) does not offer a line of commercial-grade LCD panels, so the 42” and 57” LCD panels used in the solution will be TV-grade panels.
Might a decision like this from Walmart/PRN/Planar cause a shift in Large Format LCD panel roadmaps? Or closer price-parity from LCD producers to their brand and integration partners between commercial-grade panels and TV-grade panels? Either way, the good news for the industry is that Digital Signage continues to gain momentum, and it can now focus more on supply-chain concerns rather than on true end-market demand, which seems to grow every day.

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BEAVERTON, Ore.–(BUSINESS WIRE)–Planar Systems, Inc. (NASDAQ:PLNR), a worldwide leader in specialty display systems, today announced it has been awarded a digital display contract by the leading provider of television networks at retail, Thomson’s Premier Retail Networks, Inc. (PRN). In alignment with Planar’s corporate strategy to provide innovative display solutions for retail applications, PRN chose Planar for its unique ability to provide a myriad of specialty displays that meet the exact requirements of PRN. Under the agreement, Planar will provide customized small format touch-screen displays and customized large-format displays.

Serving PRN’s multiple display categories as part of its retail media network systems solution, Planar display solutions will now be used in a large percentage of the in-store networks operated by PRN. PRN works with retailers, content partners and advertisers to create in-store programming that engages, informs and motivates consumers where they shop. PRN’s programming alliances include major television networks and other media properties, as well as movie studios, record labels and magazine and newspaper publishers. PRN’s retailer customers include ACME, Albertsons, Best Buy, Carrefour, Circuit City, Costco, Jewel-Osco, Pathmark, Sam’s Club, Shaw’s and Star Market, ShopRite and Walmart Stores.

“PRN selected Planar because of its years of proven display innovation and because it has been extremely responsive to our schedule requirements,” said Scott Francis, Chief Technology Officer for PRN. “We wanted to work with a manufacturer who could combine the quality assurance systems and capabilities of a large vendor with the flexibility and speed of a smaller supplier. The Display System is a critical component in the PRN solution and we’ve found Planar to be a nimble and valuable partner.”

With headquarters in the United States and multiple specialty display technologies and applications served by its four business units (commercial, industrial, home theater and control room & digital signage), Planar offers display solutions that fit the most demanding applications, ranging from ruggedized industrial products found in airplane cockpits to massive video wall displays found worldwide in major mass-transit systems.

“Planar’s partnership with PRN validates our strategy to provide unique display products for challenging applications,” said Doug Barnes, general manager and vice president of Planar’s industrial business unit. “We have assembled the right engineering expertise and platform of products to serve the demanding needs of customers like PRN and their retail partners. Our ability to provide customized display solutions makes us ideally suited for projects that require more than a plain vanilla display.”

ABOUT PLANAR

Planar Systems, Inc (NASDAQ:PLNR) is a global leader of specialty display technology providing hardware and software solutions for the world’s most demanding environments. Hospitals, space and military programs, utility and transportation hubs, shopping centers, banks, government agencies, businesses, and home theater enthusiasts all depend on Planar to provide superior performance when image experience is of the highest importance. Founded in 1983, Planar is headquartered in Oregon, USA, with offices, manufacturing partners, and customers worldwide. For more information, visit www.planar.com.

Thomson, a leader in video solutions, is working with Symon, a global digital signage solution company, to integrate the value and flexibility of the Thomson Grass Valley MEDIAEDGE3 DS video delivery platform with Symon’s TargetVision enterprise-wide digital signage software. A combined solution of the two companies’ Internet Protocol (IP)-based technologies will offer complete scalability, supporting all types of infrastructures, from a single site to hundreds of sites across the globe.

Working closely together, both companies will offer customers a powerful combination of the Thomson Grass Valley MEDIAEDGE3 IP server and display system with Symon’s TargetVision enterprise-wide digital signage solution. The goal is to assist schools, corporations, and retail organizations to create and narrowcast dynamic content cost-effectively to high-definition (HD) displays or computer desktops located virtually anywhere.

“We are extremely pleased that will be working with Thomson on the many exciting digital signage opportunities that will benefit from our combined solution,” said Keith Roller, senior vice president of technology for Symon. “The benefit provided through our relationship with Thomson allows Symon to continue to enhance the offerings that we provide all our customers.”

The Symon TargetVision system offers users precisely targeted, totally engaging and completely relevant content that impacts both employee and customer behavior. System components include: Symon Design Studio software for content authoring, management, reporting and scheduling; and Symon Professional Services, a suite of technical engineering and customer service offerings.

“Our MEDIAEDGE3 DS is … for getting the content precisely where it is needed across networks, which might be in the same building or around the world,” said Jeff Rosica, senior vice president of Thomson’s broadcast & professional solutions within the systems division. “The key to the commercial success of digital signage is for users to be able to acquire and implement a single, well integrated, seamless end-to end-solution, which is why we are so excited by partnerships such as this.”

The Thomson MEDIAEDGE3 is a LAN-based video delivery system using standard TCP/IP networks and displays. The flexible, modular design offers a cost-effective method for distributing video content to multiple PC and set-top box clients including pre-programmed broadcast, live streaming and full-featured interactive video-on-demand.

System components include MEDIAEDGE-LEB60, a real-time MPEG-1/MPEG-2 encoder that instantly rebroadcasts via an internal server; MEDIAEDGE3-SVS3 server software featuring applications for overall content management, server and client configuration; MEDIAEDGE3-SWT3 client software, a Web browser plug-in for PCs connected to the MEDIAEDGE network; and, MEDIAEDGE-STB3, a set-top box for MPEG decoding with a remote-control unit for MEDIAEDGE3 network browsing.

Smart Network Is Said to Echo Retailer’s Project With P&G’s Olay for You

BATAVIA, Ohio — Despite growing talk about and investment in shopper marketing in recent years, relatively little money has flowed into in-store media. Now, Wal-Mart Stores is looking to change that as it readies a second-generation in-store digital TV and signage network.

Wal-Mart is preparing to unveil more details of its next-generation network, dubbed the Wal-Mart Smart Network, to marketers and advertising and media agencies at dual presentations in New York and Northwest Arkansas on Sept. 3, said a sales executive for one of its partners in the project, the analytics and technology firm DS-IQ. He said he was otherwise sworn to secrecy on the plans.

Another executive recently briefed on plans for the network said the concept involves moving TV screens–or digital signage–much closer to eye level, incorporating them into product displays, and creating interactive “virtual assistants” from which shoppers can get product information or refine choices in key categories such as health and beauty aids. The idea resembles a project Wal-Mart began testing earlier this year in which it adapted Procter & Gamble Co.’s Olay for You online recommendation engine for use in stores.

Executives of Wal-Mart didn’t return calls or e-mail for comment.

The payoff is potentially huge for Wal-Mart and an in-store-media industry that faces new pressure — and opportunities — to show effectiveness. Nielsen Co. last month began full rollout of its Prism system to measure in-store audiences and sales impact from in-store promotions and media. Wal-Mart has been a charter backer of the system, allowing Nielsen limited access to scanner data it otherwise withholds from syndicators.

Budgeting
One stated goal of Prism’s backers, including Wal-Mart, P&G and their joint media agency Starcom MediaVest Group, is to provide data on in-store marketing and media comparable to that for other media, so that it’s easier to tap media rather than sales promotion budgets to pay for it.

For years, Wal-Mart executives have compared growing foot traffic in their stores, now north of 130 million weekly, to declining network TV audiences. Yet the Wal-Mart Television Network has never become a big media player. It’s operated by PRN, a unit of the French company Thomson, which owns Technicolor and sells a variety of products and services for the movie and TV industries.

Advertising revenue for Wal-Mart TV totaled about $61 million in 2003, according to documents PRN released as part of an aborted initial public offering in 2004. Thomson hasn’t broken out PRN revenue separately since acquiring the company in 2005, but the unit of which it’s part has been shrinking in the past year, and financial reports suggest the entire PRN business (including other networks for such retailers as Best Buy and Costco) couldn’t have grown much more than $250 million, with Wal-Mart TV ad revenue not much higher than $100 million to $150 million.

Any way you cut it, Wal-Mart TV’s mega-reach has delivered revenue only on par with thinly rated cable networks rather than anything approaching the $64 billion advertisers spent last year on TV in the U.S., per TNS Media Intelligence.

Still, Wal-Mart TV hasn’t been a bad deal for Wal-Mart. PRN’s 2004 IPO papers show Wal-Mart made up a combined 89% of PRN’s $112 million in business in 2003, including around $39 million paid by Wal-Mart to PRN to operate the network, which the retailer also uses to hold virtual meetings with more than 1 million U.S. store employees. Based on a thin 8% operating margin for PRN, Wal-Mart appears to have been getting back more money from ad revenue than it paid PRN to operate the network. Essentially, it gets a corporate video network fully financed by suppliers, with some additional ad revenue to boot.

But it could be getting much more if it can tap dollars earmarked for other media. Wal-Mart and others are banking interest in its new system will be so intense that people will pay to attend a sales presentation. Besides the Sept. 3 presentations, a session on the new network — open only to agency and marketer executives at a price of $275 a head — is set for the In-Store Marketing Institute’s expo in Las Vegas in November.

Thomson’s Premier Retail Networks, Inc. (PRN), have agreed to extend their multi-year digital signage relationship with Circuit City Stores.

PRN, who has been working with Circuit City since 1994, will expand its new IPTV platform (currently being tested in 25 Circuit City store locations) and continue to supply the core in-store programming, technology and networking for the retailer’s digital signage network and their HDTV Home Entertainment merchandising.

“PRN’s programming and technology solutions are a key component of our in-store experience,” said John Harlow, executive vice president and chief operating officer for Circuit City. “We’re excited to continue our successful relationship with PRN and upgrade the capability of our network.”

PRN reaches consumers in over 6,500 leading retail stores worldwide. PRN’s retailer customers include ACME, Albertsons, Best Buy, Carrefour, Circuit City, Costco, Jewel-Osco, Pathmark, SAM’S CLUB, Shaw’s, ShopRite, Star Market, and Wal-Mart Stores.