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Author Topic: Dolby's new sound system
Bobby Henderson
"Ask me about Trajan."

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From: Lawton, OK, USA
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 - posted 03-03-2014 04:25 PM      Profile for Bobby Henderson   Email Bobby Henderson   Send New Private Message       Edit/Delete Post 
quote: Terry Lynn-Stevens
I would say the future of Dolby is riding on the shoulders of Atmos in the home segment. If Atmos does not succeed long term (which I think it won't) then Dolby has no future.
Bullshit.

Dolby Digital is ubiquitous in TV broadcasting and content streaming via services like Netflix. An electronics company can't sell TV sets, computers, receivers, game consoles, etc. without including Dolby Digital decoding.

Dolby Atmos is a prestige brand that gets them back into commercial cinemas in a public way (even though they sell a great deal of booth hardware movie theater customers don't see). Atmos gives them the high end halo needed to back up all those other Dolby brands that were quickly getting relegated outside of the cinema.

quote: Terry Lynn-Stevens
You might think I might be overemphasizing the mobile segment but Dolby has clearly recognized that mobile is essential. Dolby is on record and has said that in order for Dolby to grow in the future it is from the mobile area.
I've got some bad news for Dolby. If they think mobile is essential to their business they came a few years too late to the party.

Mobile is well on its way to being in the same place as the traditional personal computer. The market is absolutely saturated. Sales trends clearly show customers are growing sour on the cycle of buying new phones or tablets every 18-24 months. Why replace a 2 year old smart phone that still works with a new phone that can't offer any new "must have" features? Smart phones are transforming from an "I want" piece of bling for others to envy to being a mere tool that only needs to be replaced/upgraded when it breaks or no longer works properly.

There's little if any room for new growth in the mobile market. Investors have made just about all the money they're going to make in that arena. It's time to move on to something else.

There are plenty of other things customers don't like about their mobile phone service, $100+ per month bills being one of them. We're going to see a lot more in the way of people keeping their old phones and going to rival carriers for cheaper contracts. T-Mobile is pushing the ball in that direction. It looks likely Sprint may engage in some price wars, given Softbank's CEO has taken over the Japanese market that way.

Applying Dolby Atmos-branded technology to headphones sounds like a solution in search of a problem. Most people only listen to music, watch YouTube style videos and peruse other social media content on smart phones. Surround sound, even simulated, isn't needed for any of that. Honestly, I don't think customers are going to give a damn about it. I'm a big surround sound fan, but I don't take headphone solutions and small screen viewing seriously at all for watching movies. I'm not going to spend $199 plus all the extra fees and shit (making it over $300 -plus contract renewal) to get some Atmos-branded crap bundled into a smart phone.

quote: Terry Lynn-Stevens
They did, I think they hired some former Apple marketing expert.
Hiring a marketing guy who used to work for Apple is absolutely no guarantee for success. Look at just how deep Ron Johnson plunged JCPenney into the toilet with his vision.

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Joe Redifer
You need a beating today

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 - posted 03-04-2014 12:59 AM      Profile for Joe Redifer   Author's Homepage   Email Joe Redifer   Send New Private Message       Edit/Delete Post 
quote: Terry Lynn-Stevens
Dolby is on record and has said that in order for Dolby to grow in the future it is from the mobile area.
But does Dolby REALLY need to grow? How big do they need to be? How much is enough? Too much is never enough. I'd be happy with them staying their current size and just doing their thing. Just because a company doesn't grow doesn't mean they can't profit.

So much emphasis on growing NOW GET YOUR MINDS OUT OF THE GUTTER!

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Lyle Romer
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 - posted 03-04-2014 05:32 AM      Profile for Lyle Romer   Email Lyle Romer   Send New Private Message       Edit/Delete Post 
quote: Terry Lynn-Stevens
I would say the future of Dolby is riding on the shoulders of Atmos in the home segment. If Atmos does not succeed long term (which I think it won't) then Dolby has no future.
To emphasize Bobby's point, Dolby Digital is THE standard for 5.1 cable and satellite. It isn't going anywhere anytime soon.

quote: Joe Redifer
But does Dolby REALLY need to grow? How big do they need to be?
As Freddie Mercury once said, "Bigger is better.....in everything!"

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Bobby Henderson
"Ask me about Trajan."

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 - posted 03-04-2014 10:32 AM      Profile for Bobby Henderson   Email Bobby Henderson   Send New Private Message       Edit/Delete Post 
quote: Joe Redifer
But does Dolby REALLY need to grow? How big do they need to be? How much is enough?
Unfortunately those questions don't matter when a company is selling publicly traded stock. Some investors wouldn't give a scent free fart if a company was merely operating at a profitable level. They demand that company increase its percentages of profit every quarter or, dammit, they're going to sell their stock. Just look at all the demands being made of Apple lately. When the company has shareholders who own a big enough stake to sit on its board (or at least become "activist shareholders") its executives can literally lose control of their strategy on running the company.

I wonder if some companies who have "gone public" realize what they're getting into with IPOs and all that stuff. They can get a huge infusion of money up front in the short term. But it can cost them the vision they had for that company in the long term. When your company has shareholders you basically have partners that will arm-chair quarterback your decisions even though they probably don't know dick compared to your own level of expertise.

It's interesting to see some companies, like Dell, trying to go private or others like In-N-Out Burger flatly refusing to go public at all, regardless of billion dollar size fortunes its ownership group could make in doing so.

This stuff of trying to shoe-horn "Dolby Atmos" into mobile devices smells like something that would come from a board of directors, or rather some guy trying to please the board of directors.

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Terry Lynn-Stevens
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 - posted 03-04-2014 05:41 PM      Profile for Terry Lynn-Stevens   Email Terry Lynn-Stevens   Send New Private Message       Edit/Delete Post 
quote: Joe Redifer
But does Dolby REALLY need to grow?
You have to look back in the past at Dolby records to see how they are shaping their future, the Dolby of today (in emerging tech segments) is not the "de facto" standard that it once was.

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Lyle Romer
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 - posted 03-04-2014 06:09 PM      Profile for Lyle Romer   Email Lyle Romer   Send New Private Message       Edit/Delete Post 
quote: Terry Lynn-Stevens
You have to look back in the past at Dolby records to see how they are shaping their future, the Dolby of today (in emerging tech segments) is not the "de facto" standard that it once was.
The fact that mobile is emerging (although I'd argue it has already emerged) doesn't mean normal TV and sound systems are declining. Even if people watch more on mobile than they used to (therefore splitting time with traditional TV sets/sound systems), they still need to own the traditional equipment.

Dolby's revenue isn't based on viewings, it's based on hardware sales. Emerging segments aren't killing Dolby's revenue.

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Terry Lynn-Stevens
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 - posted 03-04-2014 06:19 PM      Profile for Terry Lynn-Stevens   Email Terry Lynn-Stevens   Send New Private Message       Edit/Delete Post 
quote: Lyle Romer was the last to post

Lyle, just take a read at some of the Dolby documents on their website. Dolby's revenue is about 10% hardware (exhibition only) and the rest is all licensing/royalties to third-party manufacturers (home theatre, PCs, optical discs etc).

The mobile segment (tablets/cell phone) is emerging, mobile is replacing optical/PC/ and some broadcasting. Mobile is not subject to include Dolby. This is the segment that they are losing out.

quote: Lyle Romer
Emerging segments aren't killing Dolby's revenue
For example: As PCs continue to be replaced by cell phones and tablets, Dolby loses out if those tablets are not equipped with Dolby technology.

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Mike Blakesley
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 - posted 03-04-2014 06:39 PM      Profile for Mike Blakesley   Author's Homepage   Email Mike Blakesley   Send New Private Message       Edit/Delete Post 
I suppose it's possible that Dolby could become the next Kodak, but not very likely. For one thing Dolby is debt free...meaning they have a ton of ability to leverage new technologies (and buy competitors). Don't underestimate them just because you don't see their logo all over everything like you used to.

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Chris Slycord
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 - posted 03-04-2014 09:43 PM      Profile for Chris Slycord   Email Chris Slycord   Send New Private Message       Edit/Delete Post 
quote: Terry Lynn-Stevens
Lyle, just take a read at some of the Dolby documents on their website. Dolby's revenue is about 10% hardware (exhibition only) and the rest is all licensing/royalties to third-party manufacturers (home theatre, PCs, optical discs etc).
A big percentage of those licensing and royalty revenues were obviously included in his "hardware sales" statement. If I receive a royalty based on the number of wigets you sell, indirectly I am getting payments based on the hardware sale of the wigets even if I am not actually selling them myself.

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Bobby Henderson
"Ask me about Trajan."

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 - posted 03-04-2014 10:25 PM      Profile for Bobby Henderson   Email Bobby Henderson   Send New Private Message       Edit/Delete Post 
quote: Terry Lynn-Stevens
The mobile segment (tablets/cell phone) is emerging, mobile is replacing optical/PC/ and some broadcasting. Mobile is not subject to include Dolby. This is the segment that they are losing out.
Two things.

First, a news flash for you, Terry, Dolby is one of the developers behind the Advanced Audio Codec, better known as AAC. Dolby (along with co-developers AT&T Bell Labs, Fraunhofer IIS, Sony & Nokia) earn royalties off AAC decoding technology included in just about every mobile phone and tablet made currently. I'm kind of foggy on how well the Dolby AC-3 codec is supported in mobile devices, but I would suspect most do support it since a lot of MPEG-4 AVC encoded videos contain Dolby Digital audio streams.

Second, I'll repeat my statement how "the bloom has fallen off the rose" in terms of market growth. The developed world has become saturated with smart phones and those markets are now experiencing serious fatique in terms of product upgrade cycles and service plan prices. At the recent Mobile World Congress convention cheap phones for emerging markets took center stage. Companies like Apple, Samsung, HTC and others can't get away with the same high priced strategies in markets like China. They have to figure out how to sell a $100 smart phone or even a $25 smart phone and still make some kind of profit, even if it is miniscule in a per item basis.

I think Dolby is doing just fine with mobile, at least on the audio end of things. Perhaps they might be able to apply some of their Dolby Vision stuff into new OLED phone displays. I just don't see Atmos being relevant at all for a headphone-based portable device, such as a tablet or phone. That's like trying to fit a 155mm Howitzer artillery round into a handgun.

quote: Terry Lynn-Stevens
For example: As PCs continue to be replaced by cell phones and tablets, Dolby loses out if those tablets are not equipped with Dolby technology.
Yet another HUGE misunderstanding. Smart phones and tablets are not replacing traditional computers. I wrote this post on a real computer, not my smart phone. I can't run my graphics programs on my phone or a tablet. Hell, I can't even use standard office applications in an efficient, productive manner on a portable device. I gotta have something with a substantial monitor, real keyboard, real processing horsepower and lots of storage capacity. Mobile devices don't provide that.

People do a lot of playing on portable devices. To get a lot of work done you need a real computer for that.

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Mike Blakesley
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 - posted 03-04-2014 10:34 PM      Profile for Mike Blakesley   Author's Homepage   Email Mike Blakesley   Send New Private Message       Edit/Delete Post 
+1 to that. I keep hearing about how mobile devices are "replacing" desktop computers, but what they forget to mention is that desktops are used for ACTUAL WORK or data production, where mobile devices are used much more for CONSUMPTION.

Usually when I'm "waking up" in the morning, I'll use my phone to check the weather, Facebook, email and Film-Tech. Once in a while I'll feel like making a response to something and it's just maddening how hard it is to do it in comparison to having a real keyboard.

I think the whole notion of "getting work done" on a mobile device is a lot more specialized than tech-heads would have us believe. For example Mark Gulbrandsen uses a mobile all the time in his work, but he's got tools that are made for that. At the same time, he usually uses my office computer a time or two when he's here, to do stuff that requires a lot of typing (or a big monitor).

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Bobby Henderson
"Ask me about Trajan."

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 - posted 03-04-2014 11:03 PM      Profile for Bobby Henderson   Email Bobby Henderson   Send New Private Message       Edit/Delete Post 
This whole notion of mobile devices replacing PCs has been ridiculous. Yet the technology press and a LOT of investors have embraced that nonsense and repeated it constantly, even though it stinks the same way as political spin.

Very few people need to buy a new PC every couple of years. Honestly, that's how it has always been. Investors don't see it that way. They expect the public to buy new computers in the same rapid cycle as they've been buying phones and see a big problem with the computing industry because that cycle isn't happening. They're also bearish on TV sets for the same reason (even though lots of people keep the same TV for a decade or longer).

Over the past 15 years or so customers have been able to get more and more years of life out of each computer they buy. That's why Microsoft and other computer manufacturers are pulling their hair out trying to get a bunch of people to upgrade out of old Windows XP computers that still work.

Somewhere along the way someone made the silly assumption that if a customer has bought a smart phone or tablet in recent years, but hasn't replaced his old PC in a long time that must mean that old PC isn't getting used anymore. That's just flat out wrong. Most people now just keep using their computers until they break or no longer work properly. It can take upwards of a decade for a computer to complete that cycle.

Maybe the folks in the technology press and investing community will figure out this truth when mobile devices fall into that same camp. They'll realize the truth when they see more and more people using phones three, four or five years old. It will get to the point where phone users will keep an old phone until its battery no longer holds a charge and the AC adapter is broken and can't be replaced. That time is coming.

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Terry Lynn-Stevens
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 - posted 03-04-2014 11:42 PM      Profile for Terry Lynn-Stevens   Email Terry Lynn-Stevens   Send New Private Message       Edit/Delete Post 
quote: Mike Blakesley
+1 to that. I keep hearing about how mobile devices are "replacing" desktop computers, but what they forget to mention is that desktops are used for ACTUAL WORK or data production, where mobile devices are used much more for CONSUMPTION.
Mike, let's not be silly here, everyone knows that they will need a desktop or a laptop for somewhat serious work, most people can get by with a tablet, I know at least 10 people who do not use laptops or desktops anymore. There is no doubt that the data is showing that the average person is replacing their laptop with a tablet purchase. There will probably be a market right now for the PC as we know it, but the ceiling for tablets is not determined.

The market share for PCs is simply declining while tablets are increasing year after year.

Here is some of the latest data:

The PC Market Is Doomed To Shrink For Another Four Years, Researchers Predict

Here's yet another gloomy report for the PC market. Even though 2013 was the worst decline on record, the market hasn't hit rock bottom yet and will continue to shrink until at least 2018, market research firm IDC says.

In 2013, the PC market declined by 9.8%, IDC says. That's a tiny bit better than how IDC thought it would go down - it had predicted a 10.1% decline.

IDC's 2013 numbers echo the report from another market research firm, Gartner. Gartner said that 2013 shipments were down 10%, the worst decline in PC history. As of the fourth quarter of 2013, the market had been shrinking for almost two years straight, seven quarters in a row.

Instead of replacing older PCs, people are buying tablets and smartphones. In emerging markets, where most of the PC growth used to happen, people are also skipping the PC for tablets and smartphones. But in some cases the economy is so soft, they aren't buying new devices at all.

In the corporate world, the last of the Windows XP PCs are finally being replaced with newer PCs. But that bit of corporate shopping hasn't offset the general downward trend.

The PC Market Is Doomed To Shrink For Another Four Years, Researchers Predict

quote: Chris Slycord
A big percentage of those licensing and royalty revenues were obviously included in his "hardware sales" statement.
I am assuming you took a look at the Dolby info?

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Chris Slycord
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 - posted 03-05-2014 12:30 AM      Profile for Chris Slycord   Email Chris Slycord   Send New Private Message       Edit/Delete Post 
No, but am I to presume that the data shows that they make little off licensing their technology to DVD/Blu-ray/receiver manufacturers? Because I have a hard time believing that those amount to chump change.

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Terry Lynn-Stevens
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 - posted 03-05-2014 01:00 AM      Profile for Terry Lynn-Stevens   Email Terry Lynn-Stevens   Send New Private Message       Edit/Delete Post 
quote: Chris Slycord
No, but am I to presume
Well, maybe you should go and look for yourself Chris.

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