3-D TV Sales Are Set for Eye-Popping Growth

3D TVWhen ESPN 3D debuted in June with broadcasts of the 2010 FIFA World Cup in 3-D, the idea was still a novelty. By the next World Cup four years from now, however, 3-D is likely to be closer to the norm.

This year's 3-D-capable TV shipments will total about 4 million units, or about one for every 20 flat-screen TVs sold. Next year, that number is expected to more than double, according to recent separate reports by NPD Group unit DisplaySearch and by iSuppli.

And by the time the FIFA World Cup kicks off in Brazil in 2014, manufacturers will ship between 40 million and 60 million 3-D-capable sets, according to DisplaySearch, iSuppli and display-industry research firm Insight Media. By then, 3-D sets will account for almost 40% of flat-screen TV shipments, DisplaySearch says.

Another Next Big Thing?

"3-D content will grow in the beginning like a brush fire -- flames will appear where you least expect them," says Norbert Hildebrand, materials and business development expert for Insight Media. He says that the medium will soon be adopted for content that goes beyond special events like sports contests. "Regular programming will require a stronger install base," says Hildebrand, "but we expect some regular shows to include parts in 3-D by early next year."

Such growth would be yet another blessing to a TV-manufacturing industry that every few years has benefited from new technology developments, such as liquid-crystal displays, high definition and most recently Internet-capable TVs. While only Panasonic (PC) and Samsung introduced new 3-D TVs during the first half of the year, many other 3-D products are expected to debut at Berlin's IFA show next month, according to Paul Gray, director of TV electronics research at DisplaySearch.

Granted, TV makers will need to count on many things going right for this rapid adoption to take place. For instance, while a sporting event or a Blu-ray disk version of a 3-D movie may provide an optimal viewing experience, some of the new content may merely come in the form of upgraded 2-D programming.

Overnight Movie Downloads?

"The best 3-D TV content should be created with tri-dimensional viewing in mind instead of being simply transposed from 2-D," says Pietro Macchiarella, a research analyst at Parks Associates. "Lower quality content may push consumers away from the technology."

Additionally, with companies like Netflix (NFLX) estimating that DVD rentals and purchases will peak within a couple years as more people download or stream content over the web, limited bandwidth could force a scenario where true 3-D digital content will require an overnight download time, at least for the next few years, says Hildebrand. Content providers are already forced to compress high-definition programming.

Finally, current 3-D TV models still require the use of special 3-D glasses, to which Japanese consumers, at least, have said "no thanks." While portable devices are being developed to enable 3-D viewing without the funky glasses, so-called autostereoscopic TV displays are five to 10 years away from being widely available, according to Hildebrand and Macchiarella.

As Costs Fall, 3-D Should Become Common

Such factors illustrate how the so-called Avatar effect -- where a single record-breaking movie title can spur a 40% jump in 3-D movie screens in less than half a year -- is unlikely to strike home-viewing 3-D, which will depend on a broader range of new programming.

Still, as with any new technology, costs associated with creating a TV that can accommodate 3-D viewing, also known as stereoscopy, are expected to fall as manufacturers ramp up to take advantage of the new TV trend.

"The cost differential of implementing stereoscopy in consumer electronics is relatively low and will become even smaller in the coming years as development costs are amortized," says Macchiarella. "It seems natural that manufacturers will include it as a more standard feature in their devices."
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