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The Television Revolution That Never Happened

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The holiday season was supposed to launch the year of the 3-D TV, or so we thought. 2010 saw a slew of 3-D movies reach box office success, led by Avatar, and with consumer spending on its way up, 3-D TVs were going to be all the rage. Best Buy (NYSE: BBY  ) announced a partnership with Panasonic and dedicated a relatively large portion of its floor space to 3-D. Plus, who could miss the commercials for 3-D on every possible show?

But the industry got a little bit ahead of itself and sales never really took off, resulting in falling prices. The problem is, there wasn't really any reason to believe consumers had an incentive to make the 3-D switch this early in the game. There were just too many factors working against it.

  • Limited television programming: ESPN 3-D has been around for months, but that's really the only major channel available for 3-D viewers. Discovery (Nasdaq: DISCK  ) , IMAX (Nasdaq: IMAX  ) , and Sony (NYSE: SNE  ) will launch their joint venture channel early this year, but two channels aren't enough to make me run out and buy a 3-D TV.
  • A saturated HD market: After shelling out good money for a big-screen HDTV over the past few years, folks just don't have the money for another massive TV purchase.
  • Time is of the essence: It took years for HDTV to hit the masses. It required consumers to make an investment in TVs, networks to make the HD switch, and cable operators to make channels available. 3-D won't ever be as prevalent as HD, but it will still take time to make the switch.

If we were expecting 3-D to revolutionize our lives or bump holiday sales, maybe we were expecting too much too quickly. Nevertheless, the 3-D revolution is still alive. RealD (NYSE: RLD  ) is continuing the push, partnering with Samsung to develop an LCS-based RDZ 3-D display technology. With more and more content coming out all the time, the switch will happen, just more slowly than some would like.

Interested in reading more about RealD? Click here to add it to My Watchlist, and My Watchlist will find all of our Foolish analysis on this stock.

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Fool contributor Travis Hoium owns shares of IMAX but does not own a 3-D TV, yet. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

Best Buy is a Motley Fool Inside Value pick. IMAX is a Motley Fool Rule Breakers recommendation. Best Buy and Discovery Communications are Motley Fool Stock Advisor selections. The Fool owns shares of Best Buy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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  • Report this Comment On January 04, 2011, at 7:12 PM, ppkamela wrote:

    Unfortunately the manufacturers and distributors have only contributed to the public reluctance to purchase 3D TV as well. As you point out, content is limited and when you do a little research it is even more limited than at first glance. Yes, there have been a slew of 3D movies in the last year, but only a few of those are available for your new TV because of exclusive deals that were supposed to entice buyers to go with a particular brand. The result? Why should I buy a new 3D TV packaged with 'Avatar' only to discover that I can't get 'How To Train Your Dragon' for the kids unless I buy another TV from a different manufacturer?! My recommendation to anyone interested in 3D... at least wait until you can go to Best Buy and get any 3D movie regardless of the brand of TV you took home.

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