Since that pesky Internet started nibbling away at Hollywood's traditional income streams, the movie industry has been trying to figure out how to entice us back into theaters. At last, it looks like they've finally hit on a big audience-grabbing idea: 3-D movies.

Red-green flicker? You're kidding, right?
I know, I know -- it sounds like a bad flashback to the headache-inducting red-and-green plastic glasses of the 1980s. Jaws 3-D, anyone? But I'm excited about the all-digital incarnation of 3-D movie technology, simply because it works so well. The polarizing glasses look like nothing but clear plastic. Tilt your head or look sideways at the screen, and the 3-D effect is still there. I didn't walk out of Dreamworks Animation SKG's (NYSE:DWA) Monsters vs. Aliens with a booming headache and tired eyes. The technology didn't get in the way of the material.

RealD, whose technology enabled the film's 3-D effects, claimed that $25 million of that movie's $58.2 million opening weekend box office came from showings on RealD-equipped 3-D screens. The total 3-D take may be even higher.

Theater owners care, too
On top of the benefits for the individual moviegoer, cinemas have plenty of incentive to roll out the underlying technology everywhere. Cinedigm (NASDAQ:CIDM) has installed more than 3,700 digital screens in North America, all using Texas Instruments' (NYSE:TXN) DLP projection technology. The company intends to grow to nearly 10,000 screens in the next few years, through a partnership with Sony (NYSE:SNE) Pictures. Some cinema chains like AMC have their own digital platform rollouts slated, too.

Once the screen and projector are in place, theater owners can simply attach any of the major 3-D screening technologies -- Dolby (NYSE:DLB) 3-D, or DreamWorks or Disney's (NYSE:DIS) versions of RealD, for example -- and usher in the audience. This technique even works in digital IMAX (NASDAQ:IMAX) theaters, too.

This means that filmmakers can start making movies with 3-D in mind. This stuff looks great in the cinema, but it's not easily replicated by your home theater. Downloading and watching it on your computer starts to seem like a silly idea. Dreamworks Animation will release everything in 3-D from now on, and other animation studios will probably follow. There's no reason why live-action movies couldn't enjoy the same enhanced cinematic language.

Get used to those 3-D glasses, folks. This is the wave of the future. Who would have thunk that 3-D would rescue cinema?

If and when RealD goes public, it might make a pure-play 3-D investment worth investigating. In the meantime, we can stock up on Dolby, or digital cineaste Cinedigm, or the company behind the hardware curtain -- Texas Instruments.

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