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How do you quantify demand for mobile 3D content?

May 8, 2012

One of the more frequent questions we hear from investors is: “How do you quantify demand for mobile 3D content?”

Without a lot of hard data to lean on since we’re relatively early in the adoption curve (especially for mobile 3D), we’ve been looking to several analogs as proxies for future 3D content demand:

– HDTV sales – There are growing similarities between the adoption of 3D and HD formats, but the growing pains for HD lasted a lot longer than most people think. For example, unit sales for 3D devices/TVs have been dramatically more brisk than HDTVs – even in a down economy. See chart:

– HD content – 3DTVs came to market in 2009, and HDTVs in 1998. Interestingly, the same lack-of-content complaints that we hear today in 3D (after 4 years in-market) were still heard almost 10 years after HD’s market entry (see Mark Cuban’s blog: http://bit.ly/KBKVtf). Now HD is pretty ubiquitous. I think the same pervasiveness will materialize with 3D; however I believe that smartphones and tablets will lead the way in 3D instead of 3DTVs. Why? No glasses required!

– 3D films – Another potential gauge of 3D content demand can be illustrated at the box office. For example, only 7% of feature films released in 2011 were in 3D (45 out of 610), but 6 of the top 10 highest grossing films were in 3D. I borrowed this stat from the MPAA and a recent interview: http://bit.ly/IQEr9

What do you think? What would you look at to gauge demand?

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