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Smart TV manufacturers monetize their product after they sell it.
Internet of Things (IoT) devices are redefining the concept of making a profit from their sale. If earlier electronics manufacturers earned on a margin, now they are ready to sell their products at cost or even cheaper. This is due to the fact that manufacturers make a profit not from the sale of the device, but from the user data that they can collect with it and then sell it.
High-end smart TVs from companies such as Vizio (USA) and TCL (China) feature large displays with thin bezels, support for streaming video services and 4K and HDR formats. During the winter holidays, the cost of 65-inch models of such TVs was about $ 500. According to Vizio CTO Bill Baxter (Bill Baxter), such a low price is due to the fact that some manufacturers collect data about their users and sell it to third-party buyers.
As Baxter explained to The Verge, smart TVs can collect information about viewers such as watch time, TV shows watched, reaction to ads, and more.
“This is a brutal industry. This is an industry with 6% profit, right? That is, you know, it's cruel. You can call it self-deception, or you can assume that there is a better option. And he is. The best option is that I don't have to make money on the TV itself. I just need to cover my expenses, ”Baxter said.
In addition to collecting and selling data, producers sell TV shows, films, and advertisements. It is this kind of mixed profit-making model that allows monetizing a product after it is sold to the consumer, and allows manufacturers to sell high-end electronics at a relatively low price.
