Ahmad Ouri, Chief Marketing Officer, Technicolor and Jimmy Kim, Technicolor Digital Content Asia Pacific There is more than just PR behind 3D. The success of 3D in the cinemas has proven that there is consumer demand and adoption of the 3D viewing experience. The success of 3D in the cinemas has benefited the content owners, the exhibitors, and the moviegoers/consumers. The demand generated by 3D in cinemas has accelerated the development of a 3D solution for Blu–ray and also the launch of 3D consumer displays. This, in turn, is accelerating production of live and recorded 3D programming for broadcast television. Technicolor is playing a major role in the growth of 3D from production all the way down to 3D digital downloads. For Digital Production, Technicolor offers 3D visual effects and animation services while for Live Production (we have) developed an ‘on–location’ dailies viewing solution so that the directors and cinematographers can view the captured footage on location. For Post Production (color correction and conforming), Technicolor has serviced more feature films in post production than all our competitors combined since our first digital intermediate services for Disney’s Chicken Little in 2005, (and we have) leading market share in 3D Digital Cinema mastering and distribution. For Film 3D, Technicolor has developed and is currently deploying a low cost / high quality 3D film–based solution for cinemas (this solution is meant to address the screen scarcity problem and as a solution that focuses on cinemas that will not be able to afford a digital 3D system in the coming years) For Blu–ray 3D, (we were) the first company to develop a compression, authoring, and subtitling solution for Blu–ray 3D and as a result produced the first ever full length feature film on Blu–ray 3D. And for Broadcast Television, Technicolor built and has demonstrated an end–to– end 3D broadcast infrastructure at our Chiswick Park facility in London. As is the case at the launch of any new format or technology, there is an investment required upfront to get consumer adoption to a critical mass. At the moment, we are seeing the consumer electronics companies subsidizing some of the content production costs and bundling content with their 3D products to jumpstart consumer adoption of 3D. Further, we have seen a consistent drop in price points for the 3D products (mainly the displays). As the price premium for a 3D TV set declines, we expect that consumers will be buying 3D sets over the 2D sets. For theatrical, there are certain geographies in Asia that can definitely benefit from the Technicolor 3D film–based solution. The exhibitor only has to install a silver screen and Technicolor will provide the lens (that works with a traditional 35mm film projector). The financial model is one of no risk for the exhibitor since it is a ‘pay as you use’ model. TV will depend on the proliferation of TV sets and the availability of locally produced 3D content. Hollywood 3D films will most likely not be adequate to fuel growth for the consumer 3D market in Asia. Yeo Chun Cheng, Chief Information Officer, Media Development Authority of Singapore The interest in 3D content is very strong all over the world. Spurred on by the success of 3D movies and advances in 3D technology that made 3D viewing comfortable to many, content producers are pumping up their production in 3D content. For instance, Singapore companies have lent their skills and talent to a slate of stereoscopic movies and television programmes such as Amphibious, Bait, Shelldon and The Challenger Muay Thai 3D. TV manufacturers like Samsung and Panasonic are also pushing the sales of 3DTV sets, hence there is definitely a strong demand and market for 3D content and technology. Singapore’s pioneering leadership in stereoscopic 3D developments stretches as far back as 2008 when we inaugurated the 3DX: 3D Film & Entertainment Technology Festival. This Festival drew a stellar cast of 22 international speakers and celebrities, including Jeffrey Katzenberg (CEO, DreamWorks Animation), Jim Gianopulous (Fox Co– Chairman), Dan Glickman (MPAA Chairman), filmmaker Jon Landau and Hollywood star Brendan Fraser, and crystallized Singapore as a global platform for bringing together and advancing the industry’s stereoscopic 3D drive. Our 3DX Festival provided an important impetus to galvanise the media industry in Singapore to gear up for 3D. In addition, we set–up the S$10 million Stereoscopic 3D Development Fund to seed the production of stereoscopic 3D feature films and to boost local 3D capabilities. Today, Singapore is one of the first territories in the world with one–stop, end–to–end production and post–production capabilities in theatrical stereoscopic 3D. Local companies such as BlackMagic Design and Widescreen Media have upgraded their equipment and facilities with the latter providing filming equipment, technical services and specialised manpower and the former providing post– production and visual effects expertise in the filming and editing of 3D projects. The growth momentum in Singapore’s theatrical stereoscopic 3D developments will also be extended into the television space. We are planning to support 3DTV content, both factuals as well as sports. With that would come advertisement, not just for TV but for outdoors as well. Some of our companies are beginning to show 3D ads in shopping malls and outdoors. In setting up for Singapore’s 3DTV trial, our approach is to set a stage for interested parties to trial and guage user demand in order to decide how and when 3D will go mainstream. We will also take the opportunity to educate the public. We reckon that such a transition to 3DTV will take several years. As with the emergence of any new technology, the factors driving consumer adoption are multi–faceted and involve cost, availability of content and infrastructure. It is clear however that in the wake of recent 3D box office successes, the 3D phenomenon is here to stay. We think the potential is great too, in theatrical, TV, games, advertisement and other forms of entertainment. Our strategy has been to boost the development of stereoscopic 3D content, applications and services and build an industry of 3D production experts to meet future demand. In time, our goal is to enable complete capability in the entire 3D value chain from production, post production and cross–platform services. Tom Keaveny, Executive Vice President & Managing Director, Discovery Networks Asia–Pacific Just as there were naysayers when HD first launched, you can expect the same for 3D. We believe 3D could have a similar path to HD. While I can’t disclose our specific plans to roll out 3D here in the region, we have already committed to launching a 24/7 3D network in the US with Sony and IMAX and are focused on introducing this in the region. We have started talking to affiliates and many of them have expressed interest in 3D which has been encouraging. Asia–Pacific is one of the most technologically advanced markets in the world, and we have no doubt that audiences here will embrace this new technology quickly. There has been proven consumer interest in the 3D experience – we’re already seeing more productions being done in 3D and TV manufacturers especially those here in the region are already investing in the technology and introducing new models. In our discussions with affiliates so far, we were thrilled to see that they are also excited about the prospects of 3D. Discovery is always looking for opportunities to offer new products and services. We were the first international broadcaster to launch a 24/7 channel in Japan, and in the region. Discovery was part of the first HD offerings when operators launched HD in Asia–Pacific, and while others might be just starting to offer HD as part of their portfolio offerings, we have already successfully secured carriage for our HD services and Discovery HD World network in almost every key market here and are now moving on to 3D. Over the past year, Discovery has been evaluating several shows from across our portfolio to determine the potential of these being produced in 3D. We announced that we will launch our 24/7 3D network in the US next year, so you can imagine we will need to create content for that. The technological infrastructure here must first be able to support 3D services, and operators must be ready and keen to launch 3D. We will have the library of content and network available. 3D production costs about 30–40 percent more than 2D, so it is a significantly costlier proposition. We have yet to decide on how we will configure our distribution of our new service in the US, but I believe we will end up using the side– by–side configuration. The use of side–by–side – ie left eye/right eye – will allow the channel to be distributed to our partners in the space of one HD channel. We expect 3D to be a driver of growth in the sale of consumer devices and professional equipment. The availability of first–class 3D content is likely to ignite an upgrade cycle in consumer devices, and the emergence of 3D channels will generate demand for professional equipment used to create the content. It’s an ecosystem – as more content becomes available, more people will convert to 3D sets and subscribe to 3D channels, which will in turn help to drive more production. 3D, like HDTV, may drive higher APRUs for our operators when they adopt and launch this new service. Vinay Sewal, Vice President Operations and Marketing, GlobeCast Undoubtedly some of it is PR hype – but it’s driven by real technological development. What is clear today is that consumers at least want to hear about it. However, month by month we’re seeing 3D move from experimental to sellable. Look at all of the money earned on recent 3D blockbusters and the upcoming launch of a 3D channel by Sky in the UK. Of course, both the content and technology has to deliver to meet the viewer’s expectations to entice them to come back for more. We have not yet seen widespread interest by broadcasters for 3DTV. However, in the area of LIVE news and sports events, we are 3D ready; we are prepared to carry 3D signals globally. We delivered the first 3D Fashion show for Burberry at the London Fashion Week, sending the signals from London to customer events in Tokyo, Los Angeles and New York. GlobeCast also delivered the Don Giovanni opera live to 3D screens in cinemas in Europe, and the French Open in 3D in France and Spain. However it is important to note that we are a service provider – as such, our job is not to push any particular technology but to find the best and most cost–effective way to give our customers what they want. So we are perfectly happy providing 2D services to our clients as well as 3D. It is certainly a gamble and it’s up to each organization to balance the extremely innovative reputation and image to be gained by offering 3D with its costs and relatively low penetration rate. Similar to the take up and growth for HDTV, it is necessary to some extent for the content provider to get into the game at the right time, and with the right content. Of course, the content has to be of high quality and suited for this kind of viewing. I suppose the content providers are not so much in a rush to do so but are watching this space closely. It is too difficult to predict at this point the take–up of 3DTV in Asia. First of all, each market in Asia is quite distinct in terms of its wants, needs and regulations. In terms of theatre, the viewer pays double the ticket price to watch a 3D movie at the theatres so the content and effects have to be really good. You cannot put on a mediocre movie or event in 3D and expect them to sell. Further, many people have invested in LCD HD TVs in the last few years and they would want to see compelling motivation to reinvest in the near future. Our experience with live events delivered to theatres in 3D has been quite positive and we feel that this could be an interesting way to introduce more Asians to the latest in 3D technology. One thing is for sure, viewers in Asia are waiting with bated breath and are keen to see more and more exciting 3D technology and the content that comes along with it. There are many opportunities for content providers and marketers. Let’s see how this race pans out…! Sue Taylor, Senior Vice President and General Manager, Asia Pacific, NDS There has been a lot of media hype surrounding 3D, particularly after the success of Avatar. It is instructive to compare the introduction of 3D TV with that of HD TV. In the US, which has driven HD demand, the take–up of HD TV began in 1998 as an integral part of the transition from analogue to digital broadcasting. According to Forrester Research it took six years to 2004 for HD TV sets to reach 11% of US homes, 11 years to reach 49% last year, and will have taken 16 years to reach 71% by end 2014. Although the 3D TV sets are reportedly only around 10% more expensive than high–end HD TV sets, these high–end sets do not represent the mass market. It is questionable what proportion of viewers will want to invest in another expensive TV set, having upgraded in the last three to five years. Moreover, there is currently far more market confusion over 3D than HD, because standards have not yet been adopted and the market is very fluid. For example, active screen technology with shutter glasses is currently the most cost– effective option for the average family, but passive screen technology has many advantages, in particular the polarising glasses which will become cheaper in the long run, as they will become available from a wider range of manufacturers. For these reasons, we don’t see 3D having mass market appeal in the near future. NDS is supporting the visual elements that are aligned with 3D content, such as graphics, subtitling and the 3D TV Electronic Programme Guide (EPG). 3D content requires a 3D EPG just like HD content requires an HD EPG. The perceived ‘depth’ or ‘projection’ of the text needs to look right with respect to that of the content. At present 3D sourced content represents a very small part of the content being produced. Its main supporters are Hollywood and some game producers. Live sports will probably be the main driver for 3D sourced production. Imagine how much more excited fans will be when they can watch their favourite teams – not just live but also in three dimensions. 2D plus depth processed content is an attempt to add a dimension to 2D sourced content, but where this is a purely automated process, it gives variable results that are far from true 3D sourced material. BSkyB has used an innovative strategy by initially launching 3D TV in pubs and private clubs in the UK. Although the TV sets were expensive, the inexpensive polarising glasses allowed mass usage with minimal cost. Many operators may view 3D as a high–profile flagship service, rather than the main driver behind their wider penetration strategy. In well–established HD markets such as Japan and Korea, the main issue is the product replacement cycle, as in the US. For less affluent markets, such as China and India, the issue is the affordability of TV sets, Some platforms may include 3D TV with their premier subscription packages, which is similar to the way HD was first introduced leading to the increase in the roll out rates. NDS’ strategy is that over time as 3D becomes more common– place, that NDS will be ready to add value to this offering. Martin Farrimond, General Manager New Platforms, Broadcast Australia Certainly if you’d asked me at the beginning of the year my thoughts on 3DTV would have been that is was a nice concept, but still some way off becoming a reality. However things have moved on pretty rapidly – demand for sets in Australia has already outpaced supply. Apparently several thousand sets have already been sold, and many stockists have sold out already. Since the two key properties around which the 3DTV terrestrial trial is being conducted being sports events, namely the Harvey Norman State of Origin Series (rugby) and the FIFA World Cup (soccer), it was probably assumed that much of the viewing would be communal, in pubs for example. But sales of 3DTV sets seem to be telling a different story, that people are embracing this technology into their homes. In Australia we are seeing the price of sets come down quite rapidly, with many retailers bundling a 42–inch big 3DTV with four sets of 3D glasses and a Blu–Ray 3D DVD player. The availability of many movies in 3D on Blu Ray is also another major factor driving demand for the sets. From midnight on 19 May 2010, Broadcast Australia became the first to broadcast three–dimensional television (3D TV) signals terrestrially over the air. This landmark 3D broadcast service launches a two–month trial undertaken by Nine Network Australia and SBS Corporation. The service will be turned–on progressively in seven major Australian cities over the following weeks. As the major transmission partner in some of these cities, Broadcast Australia, working with TX Australia, will deliver to Australian fans up to 15 matches from the 2010 FIFA World Cup™ in South Africa, plus three rugby league matches from the 2010 State of Origin Series between NSW and Queensland, live in 3D. For this fast–tracked engineering project, Broadcast Australia modified several of its broadcast transmission systems to support the 3D TV signal, which is encoded using the latest MPEG– 4 compression standard and utilises a side–by–side ‘frame compatible’ 3D transmission technique. These systems have been integrated into Broadcast Australia’s Network Operations Centre (NOC) in Sydney, for 24–hour monitoring and control of the 3D signal. The spectrum used for the trial is one of the ‘unassigned’ UHF channels in each city – in Sydney, it is the same channel vacated on 30 April 2010 by Broadcast Australia’s ‘niche TV’ trial service. The first live 3D TV broadcast was to take place on 26 May, when the first State of Origin match was scheduled to be played in Sydney. This is to be followed by two more State of Origin matches and up to 15 World Cup soccer matches until the trial ends in mid July. In the meantime, demonstration 3D content will be broadcast from Broadcast Australia’s Gore Hill site. Noel Matthews, CTO group, Solution Area TV, Ericsson The latest developments in 3D have been getting more and more headlines over the last few years, while a handful of recent films and special events have made it a ‘must–see’ experience for adults and children alike at cinemas and other venues around the world. The success of ‘Avatar’ in cinemas around the world has put 3D into the mainstream consciousness, and the concept of 3D in the home is now very much a viable reality. While content makers and broadcasters begin to navigate their way out of the maze of 3D technology choices, things are already starting to speed up at the display end of the delivery chain with over 20 3D TV models planned to reach market in 2010. BSkyB in the UK became the first European broadcaster to launch a dedicated 3D channel to home subscribers on April 5th 2010. Other broadcasters around the world have also announced plans to launch 3D– dedicated channels, particularly in the US. DIRECTV added ESPN 3D, the 3D sports network, to its service offering in June 2010. Ericsson is enabling broadcasters and operators to introduce 3D consumer services today. We have launched a complete 3D solution that addresses challenges in both contribution and distribution, as well as direct–to–home delivery of 3D content. The challenges for live 3D contribution differ greatly from DTH, with the utmost being the need for the best picture quality possible including full spatial resolution. Ericsson’s large contribution and distribution portfolios have been optimized to ensure that 3D feeds are compressed and delivered correctly. The Ericsson CExH42 MPEG–4 AVC HD Contribution Encoder provides a natural platform for 3D contribution links, ensuring full control of encoding parameters, exact synchronization and time– stamping of the compressed frames and the generation of a fully packaged 3D simulcast. The Ericsson RX8200 Receiver is a new technology for these receivers that ensures that the exact temporal and spatial relationship between left and right feeds is also maintained at the receive end, avoiding possibly severe reductions in early 3D customer experience. For today’s DTH delivery, it is paramount that 3D deployments using frame–compatible methods use the best available compression technology to maximize the consumer 3D experience. The Ericsson EN8190 HD encoder provides the MPEG–4 AVC HD compression, using new in–house technology designed to enable conversion to an all–HD world. At NAB 2010, Ericsson announced that it is providing ESPN 3D, the industry’s first 3D sports television network, with a complete standards based video processing solution, featuring encoders and receivers tuned for ESPN 3D broadcasts, as well as for high quality HD. The complete end–to–end solution supports the highest picture quality from venue to viewer. Ericsson is also providing solutions to The Nine Network in Australia for its live 3D broadcast of the 2010 rugby league ‘Harvey Norman State of Origin Series’ in five east coast cities. Historic scepticism about the readiness of consumers to invest in 3D TVs and STBs is being rapidly eroded, partly by the huge revenue–driving success of recent 3D launches in the cinema but also – and perhaps more importantly in the long run – an expected rapid fall in the actual costs of purchasing the required hardware. Ericsson is helping its customers differentiate their services in a competitive landscape by enabling them to launch 3D programming, which in turn will attract more HD subscribers, given that an HD set–top box is required for 3D. Global sales of 3DTVs are expected to reach 78mn units by 2015, rising at a compound annual growth rate of 80% from 4.2mn units shipped in 2010. Revenue from these shipments is expected to rocket up from US$ 7.4bn in 2010 to US$ 64.4bn in 2015 (iSuppli, 2010). Early in 2010, Insight Media predicted that 3D products would only carry a price premium of around 20 percent against a standard 2D HD device and, based on experience with other consumer electronics devices, that premium would erode over the next two to four years. In hard terms, that translates into a fall in price for a 3D set from the current average of $1770 to $825 by 2015. The costs of acquisition, distribution and presentation may initially be high, and there is still some work to be done on establishing universal standards that will ensure a premium service for consumers and operators, but the fact is that 3D programming is here now, so in the meantime effective solutions must be used in order to attract early adopters. The cinema industry has shown the extra revenues that can be generated through 3D. Cinema owners are discovering that they can charge a substantial premium for a high–quality 3D experience, with ticket prices rising by around 25% over standard features. Digital screens now account for about 15% of the world’s modern cinema screens, with over 55% of them equipped with digital 3D. This deployment also seems to be accelerating, with 3D screen deployments in 2009 having grown by 255% when set against 2008 levels (Screen Digest, 2010). By generating similar interest in 3D in the home, TV operators can generate much higher revenues from a brand new stream. Industry and consumer interest in 3D is accelerating as much in Asia as it is elsewhere, both in cinemas and, increasingly, in the home. In Hong Kong, for example, box office takings grew 29% in the first quarter of 2010, thanks to 3D films like Avatar and Up, as well as new multiplex openings. According to local industry body the Motion Picture Industry Association (MPIA) Hong Kong’s box office grew by 29% to reach $48.2m (HK$374m) in the first quarter of 2010, compared to $37.4m (HK$290m) in the same period last year. It was not just in Hong Kong, however, where Avatar had a major impact. Its popularity soared across Asia, and China was particularly a huge territory for the film. This impact is transferring to the home in Asia as well. A number of operators in the Asia– Pacific region, including some in Korea, Japan and Australia, are planning the roll out of 3D content – particularly in sports programming, with the FIFA World Cup accelerating this deployment. The Nine Network in Australia recently announced that it will broadcast live 3D coverage of the 2010 rugby league ‘Harvey Norman State of Origin Series’ in five east coast cities – Sydney, Brisbane, Melbourne, Newcastle and Wollongong –a world–first for 3D free–to–air broadcasting. This significant announcement shows that even with limited bandwidth, DTT operators are determined not to be left behind in providing 3D. As a result of the announcement of these 3D channels and programme offerings, and in anticipation of more in the near future, Informa (2010) predicts that there will be 4.6million 3D TV homes in the Asia Pacific region by 2015 – approximately 22% of the global population of 3D homes.