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Dolby Partners Universal Music to Offer Immersive Experience

Zacks Equity Research

Dolby Laboratories, Inc. DLB recently inked a strategic partnership with Universal Music Group to bring an immersive experience to music lovers. Together, the companies aim to help take music to the next level by leveraging the enriched capabilities of Dolby Atmos.  

Per the deal, Dolby will recreate old songs from Universal Music’s catalog as well as produce newer ones across a wide range of genres, including hip-hop, pop, rock, jazz and classical music. In particular, Dolby will help unlock multi-dimensional angles to the soundscapes in an object-based mixing environment to enable music lovers feel exceptional song clarity and depth. This, in turn, will offer music composers and artists much more artistical freedom to be expressive and experimental with instruments and vocals, thereby enriching the recording content.

The process involves conceptualizing the soundscapes in a musical piece in terms of physical space, with the separate parts of a composition moved around like pieces on a three-dimensional chess board to achieve the exact mix its creators desire. The output is independent of the number of speakers involved as long as the speakers are Atmos-enabled to perfectly catch the deft nuances.

Netflix, Inc. NFLX, one of Dolby’s first partners, had long started streaming content in Dolby Atmos to its global subscriber base. Lenovo, Huawei and Xiaomi have launched PCs with Dolby Atmos, while LG has announced that it would expand the combined Dolby Vision and Dolby Atmos experience to its OLED and super UHD televisions. Further, Amazon.com, Inc. AMZN has expanded its Dolby Atmos support beyond the Fire HDX tablets, and into the new Fire TV and Fire TV Cube in addition to other compatible devices like TV, sound bars and home theater systems.

Dolby has even rolled out Dolby Atmos for headphones. Dolby Atmos content has expanded beyond premium movie and TV content to gaming and live sports. In gaming, the first Dolby Atmos game for Microsoft Corporation’s MSFT Xbox – Gears of War 4 – has been released. In live sports, BT TV channel commenced broadcasting in Dolby Atmos, and delivered the entire season of Premier League Soccer in Dolby Atmos. Also, Microsoft started supporting Dolby Vision on the Xbox One. This is the first gaming console to support both Dolby Vision and Dolby Atmos.   

Moving forward, Dolby believes that surging demand for premium viewing and audio experiences will fuel growth over the long haul. Market reports suggest that consumers are increasingly viewing video content on smartphones, tablets and computers, which in turn, is expected to unlock additional opportunities for the company.

The shares have recorded average gain of 1% in the past year while the industry declined 1%.

Dolby currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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