3-D TVs Lag, But 3-D PCs Ready To Brag

• Brian Deagon
• On 5:37 pm EDT, Friday October 23, 2009

3-D TVs aren't ready for prime time, but the computer industry is moving fast to assure that 3-D PCs have a breakout 2010.

"The adoption of 3-D on the PC will be widespread in 2010," said Andrew Fear, senior product manager of consumer 3-D products at graphics chipmaker Nvidia (NasdaqGS:NVDA - News).

In June, Nvidia released 3D Vision. The $199 PC upgrade kit includes fancy high-tech glasses that plug into a computer. Yes, 3-D viewing will still require special glasses, but they've come a long way from the red plastic of an earlier era.

Nvidia has sold "tens of thousands of 3D Vision units," Fear said.

Just two computer screens are on the market that can show the highest-quality 3-D, from Samsung and Viewsonic. But all the top display panel vendors will enter the field next year, Fear says. He also expects computer makers to jump into 3-D.

"Everyone is extremely interested in building 3-D products," he said.

Dell (NasdaqGS:DELL - News) already sells a 3-D desktop computer packaged with Nvidia's 3D Vision. Acer this month unveiled what it calls the world's first 3-D notebook PC.

"Gaming will initially drive the adoption of 3-D on the PC," said Fear, speaking last week on a panel at the Digital Hollywood show in Santa Monica, Calif. About 1,800 people attended the show, says show director Victor Harwood.

Fear's panel included executives from other pioneers in 3-D technology: Imax (NasdaqGM:IMAX - News), RealD and 3ality.

3-D Movie 'Avatar' Out Soon

The buzz around 3-D picked up this year thanks to a number of 3-D films and live-event broadcasts. Among the most anticipated 3-D films is the Dec. 19 premier of James Cameron's sci-fi epic "Avatar." 3-D films slated for 2010 include "Alice in Wonderland," "Shrek Forever After" and "Tron Legacy."

"The time will come when all movies will be made in 3-D," said Lenny Lipton, a fellow at the Society of Motion Pictures and Television Engineers and a pioneer developer of 3-D, who also spoke on the panel.

The growth in 3-D films comes as more theaters are capable of showing 3-D. Worldwide, 5,853 theater screens (including 3,713 in the U.S.) can now display films in 3-D, which is up 76% in just six months, says Marty Shindler, chief executive of Shindler Perspective, who moderated the panel.

RealD has played a lead role in that expansion. The privately held company, based in Beverly Hills, Calif., is the equipment provider that brought 3-D to nearly 4,000 of those screens. It sells digital projectors that enable 3-D and more. It expects another 500 screens will be using its 3-D projectors before the debut of "Avatar."

3ality's contribution has been to broadcast live-action 3-D events. In June, 3ality was a co-recipient of a Media Visionary award from the National Academy of Television Arts & Sciences for the live 3-D broadcast of the 2009 FedEx BCS Championship Game. The showcase game of the college football season marked the first time a live 3-D broadcast was made available to consumers nationwide in movie theaters.

"We see sports as the big market driver for 3-D technology," said Angela Wilson Gyetvan, 3ality vice president of sales and marketing. As for tapping into the PC market, she said, "We're well aware that there is a huge opportunity to take live action and pipe it into the PC."

But the end zone for 3-D is the living room TV set, and that picture remains fuzzy.

Hollywood Needs 3-D TVs

Hollywood can use 3-D to sell more tickets to movie theaters, but that's not enough to make the technology a moneymaker, says Greg Foster, president of the Filmed Entertainment unit Imax.

"More than 50% of the money is made in nontheatrical markets," such as the sale or rental of movies that are viewed on TVs, Foster said.

Samsung and Mitsubishi have 3-D capable TV sets on the market. Panasonic (NYSE:PC - News) and Sony (NYSE:SNE - News) have announced plans to come out with 3-D TVs next year. But observers say sales have been light.

"Studios are committing hundreds of millions to 3-D films," Foster said. But until a market for 3-D content and display in the home emerges, it will be difficult for studios to financially justify an aggressive 3-D development schedule, he says.

The short-term outlook for 3-D TV is weak. People won't buy TVs until there's enough content, but producers won't provide enough content until there are enough 3-D TVs out there. For broadcasters, delivering shows in 3-D requires an equipment upgrade.

The movie industry is working through the same issues. Its focus now is on adding more 3-D capable movie theaters, which are needed if Hollywood studios expect to get a solid return on 3-D investment, Foster says.

It's a tough task. The cost of converting tens of thousands of U.S. theaters to 3-D is hundreds of millions of dollars. Hollywood studios, movie distributors and movie theater owners have squabbled for years over just who should pay what for this conversion, but progress is being made.

"The momentum (for a funding agreement) seems more positive now than it was in the spring," said James Dix, an analyst at Wedbush Morgan Securities, who also spoke on the panel.

At some point, 3-D TV will mark a big transition, says Steve Shannon, executive vice president, RealD Home. "It could be greater," he said, "than the shift from black-and-white to color."

Buzz up!