Market Watch

Samsung Launches 3D VOD Platform Online in Korea


Display Driver IC Forecast


Samsung has launched an online 3D video on demand service in Korea, with Dreamworks being its major content partner.
The service's 3D content, which by the end of the year is set to include 50 titles, includes movie trailers, animation titles, music videos, and children's shows. All content will be available for free. Titles will be streamed to 3D-enabled connected TVs directly over the open internet via Samsung's TV application, Explore 3D, available for download from Samsung's online application marketplace.

Following this initial launch, the service is set to expand to the USA and Europe in the course of 2011 (specific countries and timings remain as of yet undisclosed).

Analysis
2010 saw the introduction of a number of 3D TV sets from many of the major CE manufacturers including LG, Sony, Panasonic, and Samsung. But, despite the industry's enthusiasm for 3D, uptake of these TV sets has fallen short of expectations: Screen Digest estimates that in 2010 3.3m TV sets were shipped globally, which contrasts strongly with the 7m shipment target that manufacturers were hoping for at the beginning of the year.

One of the reasons often cited for this slow uptake is the lack of an attractive content offering which has made buying a 3D TV look like a poor investment for many consumers. Striking a deal with one of the largest providers of 3D premium content and providing an easily accessible platform on which to view it can be seen as Samsung's attempt to boost its disappointing hardware sales. Perhaps the most interesting indication of Samsung's ambition is the inclusion of a number of Dreamworks' new release titles, available free of charge, including Megamind (the DVD launch of which took place at the end of February 2011). However while Samsung has been able to secure new release rights in a market like South Korea where the physical market has taken a battering at the hands of piracy, it seems unlikely that the consumer electronics giant will be able to repeat the same approach when the service launches in markets like the US, where the equivalent rights are likely to be prohibitively expensive, if they are available at all.

From a technical perspective, Korea is a natural place to launch because the proposed VoD service requires considerably high broadband throughput of around 18 Mbit/s in order to optimize customer experience. In Korea, broadband infrastructure poses very little problem as the overall average broadband speed has been as high as 46 Mbit/s in 2010. In the USA, where Samsung has announced a 2011 launch, average broadband speeds amount to approximately 6.9 Mbit/s but over 60 per cent of US consumers achieve less than 4Mbit/s. If Samsung's 3D VoD service was to launch in these territories next, it may be faced with some technical difficulties which will substantially limit its effective reach, at least in its current form.

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