I Have Seen The Future Of Television

| About: Dolby Laboratories, (DLB)

[Originally published on 6/27/2014]

Forget 4k. I know the real future of television.

Lots of prognosticators think that we’ve hit a brick wall in TV technology – and in many ways they’re right.

Color TV was, obviously, a big step forward. And flat screens as well as HD were another large leap.

But since then, no new tech has really captured the public imagination. As much as manufacturers want to get you interested in the Next Big Thing – the better to fuel another round of upgrades – nothing’s sticking.

3D feels like a gimmick. The tech isn’t quite there yet… and no one wants to watch TV with those awkward glasses all the time.

4k looks nice – but it’s not a huge leap forward. No one feels like they’re missing anything with standard HD.

In another few years – with more broadcast options – maybe things will change. But it’s unlikely to move the needle much.

The truth is that resolution – the number of pixels on our screens – is fast approaching the limits of human eyesight. In another few generations – right around 8k or a bit more than 8000 pixels across – the human eye won’t be able to distinguish the difference.

We’re not quite there yet. But we’re close. Returns on resolution are marginal this close to our biological limits.

However, there’s another aspect of television technology that’s sitting in the “dark” ages. And improving this will change everything.

Say Hello To Dolby Vision

Dolby (NYSE:DLB) is known for its sound system. But, shortly, the company will be better known for its pixels.

You see, while others have been trying to cram more pixels on a screen, Dolby has been busy making those pixels better.

Specifically, Dolby is making those pixels capable of much more brightness.

That means brighter whites. It means darker blacks. And, most especially, it means much more vibrant, true-to-life colors.

Until today, we’ve been living in a world dictated by outdated technology. In theaters, brightness was determined by how hot a film could get before it would melt (about 45 nits – a unit of brightness).

In TV, brightness has long been determined by the limits of the old, cathode tubes (about 100 nits).

But the human eye can distinguish brightness orders of greater magnitudes. Starlight, for example, is 0.001 nits… while the sun is 1.6 billion. Almost everything else is in between – and just about none of it is a mere 100 nits.

A 60 watt lightbulb, for instance, gives off about 10,000 nits. There’s never been a way for TV to capture anything like that.

Likewise, color has always been a poor facsimile. It’s been a choice between adding bright white to color – so the contrast is truer, at the expense of washing it out – or leaving it artificially dark and dull.

Neither is a great option.

But Dolby Vision has solved this. Its pixels are capable of much greater – and lesser – amounts of brightness.

Without the proper pixels, you can’t truly tell the difference, but this should give you some idea:

Viewers of Dolby Vision have likened it to looking through a window, instead of at a screen. It’s that big a difference.

And this isn’t some far-off tech either. It was unveiled in January, and the next generation 4k TVs will have this capability.

What’s more, the information needed to use those brighter pixels – up to 200 times brighter in this first generation – can be broadcast in standard HD channels. We don’t need all-new equipment throughout the process.

We just need to use about 15% more bandwidth.

In other words, your next TV is going to be a major leap above what’s come before. When your TV has the same clarity, contrast and sharpness that your window has, you’ll realize the difference.

And, by this time next year, these TVs will be in the wild. In another few years, they’ll be the new standard.

Finding opportunities like this – before the general public is even aware this change is coming – is how we at Contrarian Profits stay ahead of the curve.

And this is one curve you want to be in on early. Forget Sony (NYSE:SNE) and Samsung (OTC:SSNLF) – the real mover in next gen TV tech is Dolby. Remember that next time you’re looking to put some money to work.

But don’t wait too long. In a few short months, everyone will know about this development.

Disclosure: None