Interview: SENSIO CEO Nicholas Routhier on 3DGO, 3D’s Success and Troubles

Nicholas Routhier has been around 3D longer than most. He’s also a major advocate for the technology. As CEO of SENSIO Technologies, Routhier is behind 3DGO!, a Smart TV application which offers streaming rentals of major Hollywood blockbusters in full 3D without any external boxes. DoBlu spoke with Routhier over the phone about this app’s promises, 3D’s troubles in America, and the rather harsh consumer climate surrounding 3D as we head into the world of 4K.

The press release which initiated the process of this interview made note of 3DGO being ONLY available for Smart TVs. I’ve read plenty of articles which state Smart TVs are taking over streaming media playback, but still, isn’t that limiting in some way? Aren’t you limiting your potential market?

Nicholas Routhier: Yes, we are. If we were to develop on every platform, we would have more access to more devices. However, at the end of the day, the determining factor is if you have a 3DTV. By developing a Smart TV app, we’re actually able to target the specific TVs which have the functionality. Right now in North America, you’re talking about 10 million households that have 3DTVs – that’s less than one out of ten. By developing something more widespread, it would have been difficult to reach people more directly. Applications that stream movies are actually doing pretty good on Smart platforms. They are among the top in terms of usage. That’s what we’ve experienced in terms of Vizio deployment.

What’s the difference with the Smart TV as a platform as opposed to a dedicated piece of hardware, such as in terms of achievable bitrate or other technical specifications? What is the max bitrate of 3DGO?

Routhier: It’s 9Mbps. As far as Smart TVs, one of the differences is that the video decoder is already inside the TV, so everything we do is encoded in our format, so it’s better quality. But more important is that if you have it inside the device, you are actually ensuring that it’s the best, user friendly experience.

One of the challenges, or early challenges with having an external device, is that you had to set your TV in 3D decoding mode. And then, if you have another source or something else played, it would look scrambled. People were confused and didn’t know how to use that. Today, people are not forgiving. They want super simple and easy experience. When you have the decoding inside of the TV, it is extremely simple. You pull up the menu, you have a 2D menu, you select your 3D movie, it sets itself to 3D, you see a beautiful 3D picture, you hit a button and the 2D overlays the 3D smoothly, so all of this is totally controlled. People don’t even realize they’re using an app. That plays into the success of 3DGO – it’s something that anyone can operate. We have a lot of kids using it, watching Disney movies, because they can order them online without any issues.

Earlier, I was browsing my set and downloaded 3DGO, but there is another app called 3D Crave and 3doo. Are you aware of those? Are they considered competition, or is it okay that 3D is getting out there?

Routhier: You’re right. If there were tons of different 3D applications out there and they’re offering complete 3D to the customers, that’s even better. But yes, we are aware of these guys. Most of what’s being offered is amateur or independent features. Our view is very different. We believe that people who see a good 3D movie in theaters and enjoy them (and there are millions of people no matter what’s being said) want to bring that home. You need to offer than in the way people use computers these days. If you try to force something down their throat that they are not expecting or not wanting it, it’s not going to happen. You can’t just provide any 3D content and expect people to be happy with it or use 2D to 3D conversion. That will just disappoint people. The level of expectation is, “What I saw in theaters, I see it and want to bring it back home,” and that’s what we deliver. So in our mind, we are the unique 3D VOD store offering Hollywood studio titles and we remain committed to bringing that to our customers.

You mentioned millions of people are going to the theaters to see 3D movies, and that’s certainly true, but do you see that as people actively seeking out 3D, or is it a case of people arriving at the theater and not paying attention to the 7:55 show being in 3D?

Routhier: No. No. I would not deny that there is a portion of the population that would go to the theater and they would like to see and it’s only available in 3D at that time. That exists. But, I went to see Guardians of the Galaxy six weeks after it’s release in 3D and I was not alone. There were a lot of people in that theater. What makes a difference is if it’s well made, if it’s shot for 3D, and of studios do the promotion for the 3D version, you will see people enthusiastically supporting it. Avatar was not an accident. Gravity at 80% box office in 3D was not an accident. It was not because 3D was shoved down their throats. It’s because it added to the story and people felt compelled to see it in the format.

I was going to bring it up later, but you mentioned post-conversion 3D. I’ve seen fantastic conversions, and I’ve seen poor ones. Do you see conversions as ever being comparable to shooting 3D at the source?

Routhier: When I mentioned conversion, I was really speaking of poor real time conversion. That’s something that was offered to consumers on TV sets and instead of content, they stated, “watch anything in 3D!” That was really bad. It frustrated customers who felt cheated by the industry. I can only agree with that.

But in terms of post 2D to 3D conversion, I think you can do as good of a job in post as shooting in 3D. It’s painstaking, it’s a lot of work, it’s a lot of technology, it’s expensive, but it can achieve (in my opinion) the same level of quality. The main challenge is isolating objects and moving it in the right way. If you want to do a great job at it, you still need to plan your 2D movie as a 3D movie. You still need to shoot it, understanding that if an object touches the frame, you cannot take it out of the screen. Your brain will refuse to see it. You need to frame the shot in a way that will tell a pretty story once you convert and if you have that sensibility, you will have a great post conversion.

Certain studios are ignoring the US 3D market. We’ll use Disney at the example. They didn’t release Frozen on 3D Blu-ray here, just the UK. They’re not set to release Maleficent 3D either. That’s only going to Mexico. Do you see 3D as being more popular elsewhere? It’s something Disney is seeing, obviously.

Routhier: I think so, for two reasons. First, the US was one of the first markets. I think other markets will suffer from the same decline. I absolutely do not think that it’s going to die out. But I think it’s an adjustment phase. When 3D was sold to people, it was sold as ‘everything is going to be all 3D all the time,’ which is a lie. What 3D is all about is some movies, some times. That means you’re going to enjoy a movie once in a while. We have people on 3DGO, they rent on average 12 3D movies a year. They rent different kinds of movies all the time, but it’s not like watching the news or watching sports, which you do every night. It’s a once in a while experience. Once things settle to normal levels, it’s going to be okay.

Now, with the US, I’m afraid what we’re seeing right now is just following a trend. It was 3D love and now it’s 3D bashing. I think it’s regrettable that it has come down to this. Our job is, for all the 3D lovers that have had less access than they had before, we can offer it to them. But we also have to speak up and say that a lot of people really like 3D and they need to see it. If no one does, people will think it’s not okay. 3D is suffering from that right now.

Just one more quick example: One of the early challenges of 3D in the stores is that it was poorly demonstrated. The US was one of the only markets in the world, the first. It was really a strong push for active glasses. So all of the retailers started selling the 3DTVs with active shutter glasses. Guess what? People were breaking them, stealing them, or couldn’t operate them. If you cannot demo it, you cannot sell it. Sorry for the expression, but if your demo sucks, then people will think this isn’t mature and they won’t use it.

Other regions, especially in the UK, they started with TVs that worked on the passive side. It’s easy to demonstrate. You stoles the glasses? I don’t care. I’ll put another pair there that costs nothing or people can bring in glasses from the theater. You don’t need someone to operate it or synchronization or batteries. That played a big part in making things easier to sell. I think we need to revert back to that type of demonstration. Give them passive. I think 4K TVs are a fantastic opportunity as they will enable the presentation of HD 3D content in full resolution per eye using passive. This is the most exciting opportunity for 3D in a long time.

It does look fantastic, but don’t you think from a mass consumer perspective, we’re pushing 4K too quickly? Cable companies are barely pushing 1080p and now there’s 4K and 3D, active, passive. All of these things could be causing too much confusion.

Routhier: Oh, absolutely. I think that TV manufacturers are using the mobile trend, that overnight they can change everything but that’s not the way it works. You need to build a big infrastructure to put all of the building blocks together in order to deliver consistent good quality. I think TV manufacturers are jumping too fast on big trends without making the whole ecosystem workable. Consumers are going to be scared by 4K, they’re going to see that because they tried to sell me the Smart TVs or 3DTVs and now the 4K TVs. People are going to be a bit more demanding and even, uh, worried when they go to buy these TVs.

But there’s also not going to be any 4K dedicated content out there or very limited. It could be very dangerous for the industry to go down that route. Just stabilize. Offer a steady experience. Don’t throw away the past because you’re bringing in a new tech. A 4K 3D Smart TV is probably the best thing on the market right now, but they need to send a signal to consumers that they’re not abandoning stuff by jumping on the next big thing. We are interested in creating something that is an evolution of what we’ve already brought and that we’re going to keep offering the steady service.

You glanced over it earlier, but you did make a point about tech focused press. They’re frequently anti-3D. I know I’m saying that broadly and it’s probably unprofessional, but I’ve seen and read enough 3D is Dead articles to say that with some background. What do you think caused this influx of negative press from a side usually friendly to new technologies?

Routhier: It’s a very good question. [long pause] I’m not entirely sure. I think part of it is the fact that 3D is a bit religious. There are some people that truly think 3D is terrible, for various reasons. Some people can’t see 3D, some have headaches, or have had bad experiences where the 3D didn’t add anything to the story and it left them with a bitter taste. Some don’t like the glasses.

But for some reason, which I cannot explain, they become religious about it. They become extreme advocates. I’ve never seen for example, “4K Needs to Die.” [laughs] Why that hatred? People don’t walk down the street with a patch over one eye and say, “Oh, my life is so much better now that I live my life in 2D.” That kind of hatred? I cannot explain it.

Negativity is easier to convey though and it attracts more people than positive statements about things. A lot of people are afraid to speak up. We have tons of customers on 3DGO, and when I go to the theater, again, I see a lot people in there with me who want to see 3D movies. We are not alone but we do not speak out. We just shut up about it. I don’t think we need to turn it into a Twilight confrontation between sides, as Team Edward, but I do think that pro-3D people who love this stuff need to speak up. “We want more of this.”

I agree. Negativity is an easy source. It’s popular.

Routhier: Well yeah, exactly. When 3D was hot, everyone was loving 3D and ranting about how they loved 3D. Now, because it’s not hot, people just jump on board. I mean, people haven’t changed… [stumbles over words] Sorry, I’m passionate about this this. Look, when the TVs first came out, why did everyone jump on them? Why did TV manufacturers make them? Why did producers make them? Why did ESPN 3D happen? Is it because they were all seeing the big dollar signs? Maybe, yes. But why did they see an opportunity at all? It’s because what they saw made sense to them. What they saw they loved. They looked at it and said, “Wow. This is impressive.”

Where we failed the consumer though so far is in content creation. We went too fast. Hollywood studios and producers have the time, the money, and the talent to be able to carefully plan and present a beautiful 3D picture. The cameras are not there for live 3D. They’re getting there. But there’s a big difference between taking eight months to make a two hour movie and shooting a two hour sports event live in 3D with cameras that need to be 100% perfect. We need to do that work, but GRADUALLY get there.

Onto 3DGO in general. You only offer streams, rentals. No actual purchases. I’d really love to have Frozen in 3D since Disney didn’t release the Blu-ray here, but I can’t buy it. Why did you choose just the rental option?

Routhier: Simple. It’s extremely challenging to do it on Smart TVs. Even if you had unlimited, you’d have to go Ultraviolet or something. We’re investigating it by the way. We want to do it eventually, but it was way too complicated and way too expensive at this point.

Expensive from a licensing standpoint?

Routhier: No, from development. The one thing we could do probably is, if you own it, you can stream it as you want, but there are multiple devices and we need to change the contract we have with the studios. There are lots of complications with selling something if you cannot store it. If you can store it, it’s a totally different thing. If this was a tablet and the tablet had the memory to store it there, it’s an easy sell. If you put it on TV, there’s no memory there. That creates a challenge because of the platform, so that’s why we go for the rental.

Okay, but your pricing. It’s… up and down. I saw some items for as low as $2.50, some of it as high as $6.50. What’s dictating that price divergence in an all-rental market?

Routhier: We’re experimenting. We’re trying to find the sweet spot that will trigger the right spot for rentals. Studios want us and we agree there needs to be a premium for 3D, but not a huge premium. That dictates part of our pricing, but at the same time, we’re trying to remain competitive with what people expect. We do surveys. We look at US pricing with things like VUDU and Amazon while trying to align, plus experiment. The pricing will likely stabilize if the market does.

You run a third-party service. The one thing I see with digital, or maybe what’s coming with digital, is that studios don’t really need a service to deliver their content. The studios can do it themselves. Disney has their own platform, Warner has theirs. What makes a third-party like yourself still relevant in a digital age where it used be that studios needed something like Best Buy to pitch their physical product? What do you offer them?

Routhier: Disney, Warner, and all of the other studios can certainly distribute their content directly to their customers. The advantage that we have is that we’re a boutique operation. If you’re looking at 3D content and you want to have quality that’s seamless in operation with your TV, that’s a totally different thing. Most of what the others will do will be fragmented and the service wouldn’t be consistent from one to the other. It’s going to be complicated. That we’re a 3D only store and it’s not only easy for people to find content they want, people won’t come in and say, “What does Disney have to deliver?” No, they come in and say, “What kind of movie can I watch tonight?” So we offer a one stop shop for anyone who likes 3D movies. They come to our store, they see everything that’s out there, and they’re sure they’re going to have a high quality but also very simple experience. That’s what makes up relevant today.

We’re in line right now for a demo at CES with our first streaming in H.265 and I think people are going to be blown away. We’re talking Blu-ray quality as low bitrates.

Sounds awesome. And thank you for not making an app where I need to input my entire email address using a TV remote. That was a lifesaver and true tech innovation.

Routhier: (laughs)