Panasonic Corp. is counting on the burgeoning three-dimensional television market to help it compete better globally. But the Japanese electronics company's attempt to take on more cost-competitive and marketing-savvy South Korean rivals may be an uphill battle.

Panasonic, the world's largest maker of plasma display TVs, says it believes it has an edge because plasma is particularly suitable for 3-D images due to the display's faster response time compared with liquid-crystal displays. By the fiscal year ending March 2013, the company expects 3-D-capable models to account for 70% of the 10 million plasma TVs it plans to produce by then.

"3-D TVs are becoming massively popular, not just in the U.S. but also in other regions," said President Fumio Ohtsubo. "There's no reason to be pessimistic about the TV business outlook."

While Panasonic may temporarily benefit if 3-D technology can slow the price declines of TVs, analysts say it is unclear whether picture quality alone will help Panasonic get ahead. It needs to overpower rivals in marketing and other efforts to convince consumers world-wide to choose its plasma TVs.

"What will convince the consumer is how they see the quality and the difference in the store environment and how much of marketing and educational efforts the brands put into communicating their value," said Riddhi Patel, director of TV systems research at research firm iSuppli. "Consumers currently consider plasma as the entry-level flat-panel TV option," while the premium option is light-emitting-diode backlit LCD TV.

Plasma display TVs have been losing ground to LCD models, which accounted for about 90% of all flat-panel TV shipments last year and are expected to widen that gap in 2010. According to research firm DisplaySearch, Samsung Electronics Co., LG Electronics Inc. and Sony Corp.—which focus on LCD models—are the top three flat-panel TV makers that together account for more than 40% of the global market, inclusive of LCD and plasma. Panasonic ranks fourth with just a 7.7% share, followed closely by Sharp Corp. with 5.5%.

ISuppli expects the global average selling price for 3-D TVs to eventually drop to $825 by 2015, less than half of the $1,768 cost anticipated for this year. That means Panasonic, along with other makers, will likely see profit margins squeezed.

In addition, Panasonic doesn't have the luxury to spend all of its resources on its unprofitable TV operations. The company is slowly moving away from traditional gadgets and appliances to invest more in so-called green technology products such as rechargeable batteries and solar panels where Sanyo Electric Co., a smaller electronics maker Panasonic acquired in December, is globally competitive.

"TV is not where Panasonic's future growth lies," said Hiroshi Sakai, an analyst at Tokyo-based SMBC Friend Research Center. The company's plan to focus more on environment-related businesses is a logical step, he said, and "is pretty much the only way that Panasonic can differentiate itself from its rivals."

Last year, Mr. Ohtsubo said he wanted Panasonic to be the pioneer of the 3-D TV market, but Samsung Electronics did so instead by launching its 3-D TVs in South Korea in February. Panasonic's 3-D models made their debut in the U.S. in March.

Panasonic says its sales are brisk and it is confident of meeting its global sales target of one million sets for the first year. Panasonic launched its 3-D TVs only at Best Buy's high-end electronics store chain, Magnolia, which has about 250 outlets in the U.S. But the TVs are now being sold at more stores around the U.S.

Spokesman Akira Kadota said Panasonic is also promoting its 3-D TVs through sponsorship deals, including DirecTV's new 3-D channels to be launched in the U.S. next month.

But competition is also intensifying. Consumer electronics makers world-wide are rushing to join the 3-D bandwagon, hoping the new technology will ease the drop in TV prices. Manufacturers and analysts see huge growth potential in the 3-D market. Global 3-D TV shipments will likely surge to 78 million units by 2015 from 4.2 million this year, iSuppli says.

Samsung said this month that it may raise its 3-D TV sales forecast for this year to more than two million units. Korea's LG released its 3-D TV models in March and said it expects sales to top one million sets this year. Sony and Sharp are releasing their 3-D TV lineups this summer.