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The Walt Disney Company (DIS): Will Dolby Laboratories, Inc. (DLB) Save 3D TV?

The news that The Walt Disney Company (NYSE:DIS)‘s ESPN was pulling the plug on its 3-D TV channel generated a lot of industry navel-gazing on the health and future of the industry.

Dolby Laboratories, Inc. (NYSE:DLB)On the one hand, TV manufacturers are still selling lots of eye-popping 3-D TVs — 41 million last year and growing to 180 million sets by 2019, if the market researchers at NPD Group are to be believed. But, on the other hand, the Motion Picture Association says revenues from the content produced in the format were flat in the U.S. and Canada while the number of movies made in 3-D dropped 20% year over year.

It seems the 3-D TV is a modern version of Schrodinger’s cat in that it is both alive and dead at the same time. The decision by ESPN could indicate the scales are tipping in favor of the cat dying, if not right away, then certainly in the near future. If nothing else, it’s not a healthy development but there’s hope — and help — on the horizon.

Part of the problem undoubtedly lies in the mechanics of the technology: To get the benefit of the 3-D effect, you have to wear the annoying and tiresome glasses. The head of the U.K.’s BBC 3-D and HD division says ESPN may simply have been the victim of the format not being best suited for sports because most events are too long for continuous viewing, particularly when wearing glasses. He believes half the audience is resistant to having to do so.

Enter Dolby Laboratories, Inc. (NYSE:DLB)‘s  glasses-free technology, which could revolutionize or at least revitalize the 3-D TV industry.

In partnership with Philips, the sound specialist is developing a suite of technologies that are used during production and in the TV sets themselves that allows viewers to see a picture in 3-D without having to wear glasses. Moreover, the technology works on any 3-D TV, tablet, laptop, or smartphone, and can convert any 2-D display into an equally sharp 3-D display.

Dolby Laboratories, Inc. (NYSE:DLB) is of the mind the industry with glasses is doomed in the home. It plans to publish by the end of the specs for its technology’s broad adoption and anticipates seeing its 3D-supported devices available over the next year or so.

Perhaps the biggest concern for the industry, however, is that all of these developments focus solely on the technology and not the story being told. That may be what ultimately dooms 3-D, because it’s not how the picture is viewed but rather what the picture is saying. Content is still king, and if the movie or TV show isn’t worth watching in the first place, it doesn’t matter if it’s shown in 2-D or 3-D — people will tire of watching it before long.

Dolby Laboratories, Inc. (NYSE:DLB)’s glasses-free technology may allow the phenomenon to survive a little longer, but without movies worth watching, sooner or later we’ll have to peer into the box and confirm for ourselves that the cat is dead.

The article Will Dolby Labs Save 3-D TV? originally appeared on

Fool contributor Rich Duprey owns shares of Dolby Laboratories (NYSE:DLB). The Motley Fool recommends Dolby Laboratories. It recommends and owns shares of Walt Disney.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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