 Hey guys, this is Neil Iver with The Verge. I'm here with Matt McCray, the CTO of Visio. And we're here with the new P Series, which is a thousand dollar 4K TV. You guys announced it in CES, it's about 10 months later, and here we are. So first of all, what took so long? We wanted to get it right. So we showed our demos at CES, and we're showing a lot of picture processing demos here, and we wanted to make sure that the resolution was right, the motion capture was right, the color was right. So it's really been just fine tuning the details, and not only ship an amazingly priced 4K TV, but one that actually blows away the competition on picture quality. So that's the big question. How did you make a thousand dollar 15 inch 4K TV when everyone else is like two thousand dollars, four thousand dollars? What's the secret here? Well, it wasn't easy. We spent a lot of time doing engineering work specific to our product. So probably the biggest thing we did is we developed our own backlights. So we talked about that at CES, where we do full array local dimming across all our product lines, and by designing them ourselves, we were able to not only raise the picture quality, but actually lower the price. Wait, how does all that work to let you lower the price if you're doing all that engineering work? Because of the component price. So yeah, we spent a lot of engineering time and development effort, but the actual component price and the innovation that we did was to create a full array local dimming, right, where we got LEDs going all the way through the backlight, but actually reduced the component count by 40% at the same time. So there's a lot of integration happening where the glass meets the LEDs, meets the driver boards. We were able to reduce that overall cost through that innovation. And again, the picture quality goes up, but cost goes down. So the big question with 4K is how are you going to get content? And you guys are betting almost exclusively on streaming, right? Yeah, we've decided since our first smart TVs launched six years ago that streaming was going to be one of the primary ways people are going to get any content. And we've streamed billions of hours of video content to our smart TVs now. And 4K is not going to be different. So there will be 4K Blu-ray players in the future. There will be 4K set-top boxes in the future. This has HDMI 2.0 and will support all that. But we do believe that one of the primary ways, and probably the primary way people will get content are going to be from sources like Netflix and Amazon and UltraFlix and some of the partners we've announced today. And we had a demo in the other room and you can see that it's pretty nice. I mean, 10 to 15 megabits per second is gorgeous. And that's what you need, right? Otherwise you get a little too compressed? Yeah, it starts at about 9 point something, almost 10 megabits per second. And then it steps up all the way to 15. And by the time you're at 12 to 15 megabits per second, it is substantially better than 1080p. Really? And do you think it's going to be as good on disc? It'll be a little bit different. You'll see different artifacts. It won't be quite as good as a disc because the bit rate will be so much higher. But it's already showing a massive upgrade against what you're seeing on 1080p. And remember, it's not just going from 7 megabits a second on 1080p to 15 on 4K, a doubling of it. Because we're also using HEVC, which is a much more compressed format, it's a new format for extreme units, you're getting the double of the bandwidth, but you're also getting another doubling of efficiency. So it's actually four times the effective throughput and it looks really good. And you're building your own chips to it? We are. We have the Vizio V6 processor, which is a six core processor we're using to do all this. And we have the VM50, which is our picture processing engine that's doing all of the color, fidelity, the contrast, our pixel mapping and everything that we're doing. And that was the other way that we decided, even though it would take a little bit more time, but to not only beat people on price, but beat them on picture quality, we had to actually bring our own technology to market. So that's the question, once you start talking about processors and cores and that kind of technology and a TV, I get worried about how long until I have to replace it with a faster processor and a faster, better pixel engine and better software. How long do you think this TV is going to last? It'll last a long time. The chips that we can buy off the shelf were dual core. This is six cores. So again, one of our choices was to actually put more horsepower than we need today to make it a platform that can last quite a while. The investment, like you keep mentioning, how do you guys do it, how do you guys do it, there was definitely a very large upfront investment, but we're not passing that on to consumers. That investment we made not only for this TV, but future TVs. So we're spreading that very small across all of the platforms. So first TVs got flat and everybody rushed out and bought new form factors. And then there's been this desperate search for the next thing that's going to make everybody buy again. Don't say curved. Curved. Then there's 3D. You guys have taken 3D completely out of the picture now. You're just giving up on 3D? So what I'll tell you is one of the things we pride ourselves on is really listening and watching consumers, but listening to what they really want in a television. So there was actually two reasons. One is we looked at how many people are actually using our 3D TVs and how many people actually thought that was a very important feature set and it was pretty low. Also if you look at the 4K, if you do 4K right, if you do ultra high def with the right picture processing, you'll swear it's 3D. And we've had other people come through this gallery already and kind of look at it and say is that 3D? And it's because of the depth that we're able to produce through the picture processing. So for us, putting our investment resources towards improving the picture quality, not in a 2D, but making it so clear and the motion resolution so good that it actually looks 3D was much more important. You get to curved and things like that. Again, our opinion is curved as a gimmick. It actually hurts picture quality and causes a lot of problems so you won't see us do curved. We try and find a way to actually improve the user's experience and charge them less. Not figure out how to make their experience worse and charge them more. So for us, it's complete opposite of what we focus on. So do you think 4K is going to kick off another adoption cycle? Is that why you priced so low to get to the front of the market? Well I think what would have happened without Vizio is we would have seen maybe a three to four year, maybe five year even, transition cycle from 1080p to 4K. At least on 50 inch and above where you can really tell the difference. Our goal is to try and make that transition one to two years and get most people buying 4K TVs at those sizes by next year. And hopefully this year we're already going to get a big chunk of the market. So one of the things we like to do is actually drive transitions faster. Is use disruptive technology to get people the latest technology. Maybe they thought they couldn't afford now. And that's part of the pricing strategy is to take that market by storm. So we've talked to you a bunch of times. This feels like a refocusing on the core of Vizio which has always been televisions. You've diversified a few places. You're in sound bars. You're doing really well there. But you did laptops for a minute. You've played with phones. Is this Vizio coming all the way back to TVs or are you going to keep trying to broaden out? Yeah, a bit. What I would say is this took a lot of effort. So for the last year and a half, two years, we've actually spent a bulk of our resources perfecting UHD. And again, making sure we hit the prices that we want to hit. But really setting a new bar for quality. We think it's really, really important. So that has been the bulk of it. Also our sound bars and our audio equipment. We're the number one sound bar manufacturer as well. That's been a big focus. But I think what you can say fairly is that for the last year and a half, at least from an engineering and R&D side, we decided that there was some really cool technology coming forward and that focusing on the living room, again, was really important because we saw this transition coming. Having said that, you'll see some interesting stuff coming in the next year or two that I can't talk about. So we won't predominantly stay in the living room, but it was important to actually take a leadership position in UHD and continue that position in audio as well. So if the living room is getting interesting again because of the 4K transition, no one's cracked it, right? Everyone's still poking around the edges of it. How are you guys going to maintain that leadership position, even if everyone else is coming at you? Because they're all going to keep coming at you. Yeah. The best way and the reason we spent so much time on this is quality. You can try and be the best price forever and that's great and it will decline quick and that's something we do naturally anyways, is price aggressively. That's great. But that can also be fleeting. What really matters is actually shipping a world class product. So if you have a world class product where you've actually beaten products that are twice as expensive as you, you're going to have staying power and you're going to actually have a pretty good chunk of that market. So we have a good initial foray with these and you're going to see us continue to innovate in UHD. And again, our goal is to get people to transition into an ultra high-def living room quickly. So the last question, world class product, the other TV you showed at CS was the reference series. What's the timeline on that? Coming soon. Can't tell you exactly. We're perfecting that as well. Yeah. 40 under the air? A lot of probably not shipping. That's going to be really close. And so we may actually wait a little bit longer, give it some breathing room. But a lot of the fine tuning that went into P-Series is going into our reference series and then we have a whole other order of magnitude that we're doing for that product. And it's beautiful. I can't say too much. But the demos we showed at CES on the reference series were pretty jaw dropping and it's only gotten much better from there. Also the reference series, we want to make sure that when we launched the P-Series, we want to make sure there was content. So Netflix has great content. We've got Amazon and Ultra Fix climbing. So even if you don't have a 4K Blu-ray player yet, there's a lot of content. On the reference series, we're doing the same thing where we want to make sure that there's high dynamic range, ultra wide color gamut content when we launch. And some of that stuff's being created and mastered right now. And so we don't want to launch a TV and then not have content to actually show with it. So it's another reason why maybe waiting a few months would make more sense. So this guy's $1,000. $1,000, $999. The big one is, how big and how much? The 65 inch is $21.99 and the 70 inch is $24.99. Wow, that's aggressive. And these are going to be in stores now? Yeah, actually a few websites are already selling them live. There's some pre-orders that a few snuck out and our retailers will have them starting tomorrow but some are already on the shelf. And you're going to be able to keep them in stock? What I think is going to happen based on what we're seeing online is that we're going to sell out for a while and then we've got a whole other huge boatload coming and that's when we'll kick off our advertising and things like that in October. Awesome. Matt McCray, Vizio P-Series, $1,000, 4K. Awesome. Thanks, man. You're welcome.