Will you pay thousands for laser TV? Two U.S. startups certainly hope so. Arasor and Novalux demonstrated a prototype, 50-inch laser TV built by Mitsubishi Electric in Sydney Tuesday, although consumers won’t get to enjoy it until the holiday season next year.

Arasor, which develops the optoelectronic chip, and Novalux, which supplies the laser modules, are gunning for the large-screen plasma and LCD TV market (40 inches and up). Company executives said laser TVs offer richer colors but consumes 75 percent less power and costs less than existing flat panel displays.

“With laser, you can see a much larger color spectrum,” said Jonathan Espy, executive vice president of Arasor. Although 6-year-old Arasor is headquartered in Mountain View, California, it’s been called an Australian company because it is expected to raise $35 million Australia dollars ($26 million USD) when it goes public on the Australian Stock Exchange next Thursday.

Arasor and Novalux began work on the laser TV project nearly two years ago and found interest among TV makers who were seeking alternative technologies to plasma and LCD for flat panel displays. Consumers have favored LCD because the displays are cheaper than plasma flat screens.

Families that still watch the old-fashioned and bulky CRT (cathode ray tube) TVs also will have more choices when they are ready to upgrade. Laser technology can produce twice the color content that can be generated by LCD or plasma, said Greg Niven, vice president of marketing at Novalux, based in Sunnyvale, California, which has raised $32.2 million in two rounds since its inception in 1998.

“The sweet spot in the market that everyone is gunning for is 50” sell for under $1,000,” Mr. Niven said. “That’s where we feel where laser TV, and that makes it affordable.”

Aside from Mitsubishi, other TV makers who have announced plans to make laser TVs include Samsung. Mr. Niven declined to name other customers. Attendees of the upcoming International Consumer Electronics Show in Las Vegas in January will see 10 brands of laser TVs on display, he added.

Laser is not the only emerging technology for the TV market. Samsung, a major maker of LCD and plasma TVs, also has demonstrated a 56-inch TV using light emitting diodes (LED) that sported lighting technology from startup Luminus Devices, in Woburn, Massachusetts.

Contact the writer: UWang@RedHerring.com