Cure for upgrade fatigue

What is “upgrade fatigue?”

It’s the notion that consumers who recently upgraded to digital or HiDef television sets might not be eager to run back out to the “big box store” and buy a brand new 3D-capable television along with a new 3D Blu-ray player, and some rather expensive glasses to go with it. The cost of the glasses alone can be real money if you have some friends over to watch a movie or a sporting event.

But wait, there’s more. Blu-ray players don’t handle broadcast, so you’ll need another new 3D box in order to see the football or soccer game – once that 3D box actually becomes available <from systems that don’t already offer it such as DirecTV, Comcast, and AT&T U-verse>.

When you consider today’s economy and that current 3D television sets are priced from $2,500 to $6,000, it’s clear that 3D television equipment buyers need to be in an elite class, certainly throughout this year and probably the next. According to a recent study by NPD Group, roughly three out of every 1,000 TV sets sold in the U.S. during the first three months of 2010 were 3D-capable. Add to this the small number of 3D titles that will be available in the next year, targeting all markets from young children to horror: a mere 20 to 30. Now that is a tough market.

It is true that, as with HD sets, economies of scale will bring prices down eventually. But contrary to the hype created by the consumer electronics industry since January, any change of this magnitude will take time. The best estimates are that it will be several years for the number of television sets in homes to reach critical mass, yet that market penetration is essential to the success of a significant Blu-ray 3D movie launch.

Please keep in mind that I am the last person to be against new and better hardware. Most of my career has been focused on the invention and deployment of new technology. But one of the lessons I have learned many times over the last 50 years is that you have to be realistic about how long it takes for a real, new market to develop. The bottom line: Until that market is large enough to be viable, content owners need an alternative way to make money.

The theatrical 3D market is white hot today. Avatar, Alice in Wonderland and other titles are driving demand for 3D content for the home right now, and the consumer electronics industry sees a new pot of gold to pursue. But the inevitable time required to sell and install that critical mass of 3D equipment in the home means missed opportunities, and a lot of money down the drain for content owners.

The good news is that there are solutions to this market problem that can be implemented today. These solutions do not require a new TV set or new hardware. The demand is there and the technology exists to satisfy that demand. The studios are in the process of understanding this equation. When they see that they can capture some of those potential earnings today, as opposed to waiting for consumers to upgrade yet again, the market will adapt.

For example, there are nearly two billion DVD players in the marketplace. There is no plan on the part of the consumer electronics industry to “upgrade” any DVD equipment. Here is a massive market that already exists — a market that can be served with surprisingly excellent 3D image quality using existing hardware today. If the user’s hardware has built-in up-res to HD capability, the 3D results can be quite amazing.

I’ve been watching consumer electronics markets for a long time. What I’m seeing right now is the cure for upgrade fatigue.

Editor’s note: John D. Lowry, best known for his highly-regarded HiDef film restoration company Lowry Digital that he founded and then sold. His breakthroughs in imaging science have been utilized in everything from Apollo moonwalk images to “Avatar,” earning him numerous patents and awards. He is co-founder of TrioScopics, Inc., which creates the kind of 3D images using current TVs and DVD players that he is advocating above. Lowry was interviewed on video by 3DHollywood.net last November about his background, successes, and TrioScopics.