M+E Connections

Continued Dolby Atmos, Vision Momentum Gave Company a Boost in Q3

Dolby continued to see strong momentum for its Dolby Atmos immersive sound technology and Dolby Vision High Dynamic Range (HDR) format, while momentum is growing for its AC-4 next-generation audio compression technology, according to Kevin Yeaman, its CEO and president.

“This quarter, we continued to see Dolby Vision and Dolby Atmos experiences becoming increasingly available to more people around the world,” he said Aug. 1 on earnings call for the third quarter of fiscal 2019 (ended June 28).

For example, Apple last month announced broader support of the combined Dolby Vision and Dolby Atmos experience, he said. Apple had already been supporting Dolby Vision in the iPhone 10, iPhone 8 and iPad Pro, but Apple has now added Dolby Atmos to those products also, starting with the next iOS release later this fall, he noted. MacBook users, meanwhile, will also get the combined Vision and Atmos experience, starting with the next Mac operating system, Catalina, he pointed out. Apple TV 4K became the first digital media adapter (DMA) to support the combined Vision and Atmos experience over a year ago, he noted.

Apple customers will also be able to access the largest collection of Atmos and Vision content available, he pointed out, saying Apple now has more than 500 titles available in Dolby Vision and 300 titles available in Dolby Atmos.

“The continued adoption by our partners like Apple of both Dolby Vision and Dolby Atmos into their products reflects the momentum we have gained in establishing the Dolby experience as the best way to enjoy entertainment content,” he told analysts.

But several other Dolby partners increased their support also by announcing new devices in the past quarter that support the company’s technologies. In set-top boxes, Verizon’s FiOS TV One platform, for example, now supports the combined experience and their customers can now enjoy Netflix content in both Atmos and Vision, Yeaman noted.

Amazon, meanwhile, is supporting Dolby Vision in the new Toshiba Fire TV Edition TVs, while Vizio announced Vision will be supported across its entire 4K TV lineup, he said.

Also significant is that the entry-level pricing to get TVs with Vision continues to decline, he said, noting that with Vizio’s announcement, Dolby Vision TVs are now available starting at $250.

“We also saw a continued momentum with sound bars,” he said, noting that in the past quarter, Samsung, Sony and Vizio each introduced new products supporting Atmos at lower price points within their product line-ups. Dolby Atmos-enabled sound bars are now available at under $300, he pointed out.

In addition to Apple’s announcement, Dolby continues to “see momentum in the adoption of Dolby Vision and Dolby Atmos within PCs,” he told analysts, pointing to Dell and Lenovo announcing Vision support across more of their PCs. In addition, Samsung announced its Notebook 7 will support Dolby Atmos. Only a year ago, the first PCs to support Dolby Vision had just been introduced, and now Apple, Dell and Lenovo all have PCs supporting the combined Dolby Vision and Dolby Atmos experience, he said.

Also significant, he said: “As the number of Dolby Vision and Dolby Atmos devices increases, we have also seen the amount of content for these devices continue to grow. We now have over 10 partners streaming Dolby Vision and Dolby Atmos content. These partners combine to enable over 1,900 pieces of content in Dolby Vision and over 1,200 pieces of content in Dolby Atmos,” including movies and TV show episodes.

“In addition to the success with theatrical and episodic content, we see a great opportunity for Dolby Vision and Dolby Atmos to enhance new types of content,” he said, pointing to the European Football Champions League Final in soccer being broadcast in Dolby Atmos with BT in Europe and CCTV in China.

Dolby also recently announced a partnership with Universal Music Group to bring the Dolby Atmos experience to music content, he said, telling analysts: “Our partnership will enable thousands of songs within the UMG library to be mixed in Dolby Atmos, across a diverse group of artists and genres.”

Dolby Audio overall “continues to be strong,” he went on to say. In addition to “broad adoption” of Dolby Digital Plus across developed markets, “we continue to expand in emerging markets,” he said. For example, BTC, one of the leading broadcasters in Vietnam, started supporting Dolby Digital Plus in its over-the-top (OTT) services this quarter after launching Dolby Digital Plus in its broadcast service last year, he said.

“At the same time, we are gaining momentum in the U.S. and Europe for the transition from DD Plus to AC-4, our next-generation audio solution,” he said. Earlier this quarter, “several of the major U.S. network stations and affiliates, including NBC Universal, Fox, Univision and The Pearl TV group, jointly announced the deployment of the ATSC 3.0 audio standard with AC-4 in 40 of the largest U.S. television markets by the end of 2020,” he said.

Also, in Poland, AC-4 was “recently mandated within the audio standard for UHD TVs by mid-2020,” adding to the support it received in Italy and the Nordic countries that have also “specified AC-4 as the sole next-generation audio solution within their broadcasting standards for UHD content,” he said.

There’s also continued momentum in global support for Dolby Cinema, which he noted enables the combined Dolby Atmos and Dolby Vision experience. “Globally, there are about 225 Dolby Cinema screens open, with a total of over 400 Dolby Cinema screens open or committed,” he said, adding there’s also now more than 250 theatrical titles that have been released or announced in Dolby Vision and Dolby Atmos, and 9 of the 10 top box office films of 2019 so far have been available in Dolby Cinema, he said.

On the Dolby Voice conferencing product front, the company, in partnership with BlueJeans Technology, had announced Dolby Voice Room as a service offering that includes high-end features. The first products from that new service model recently shipped and “we have seen strong traction with customer engagement with this new offering,” Yeaman said.

Dolby’s Q3 revenue grew to $302.2 million from $214.8 million a year ago, while profit soared to $39.6 million (38 cents a share) from $3.1 million (3 cents a share), the company reported.