There was big news in the world of 3D this week: the red hot 3D cinema company Real D (Beverly Hills, CA; www.reald.com) announced the acquisition of their key supplier and technology heavyweight, ColorLink Corporation (Boulder, CO; www.colorlink.com). From the standpoints of both companies it seems like a match made in heaven. Consider the situation at the two companies before the deal.

Art Berman
Insight Media Consultant

Real D has deployed the best part of 700 3D-equipped digital cinema screens worldwide. A large part of what it takes to make a Real D 3D image look good depends on the quality of the optical components in their projection system. The top of this list includes the liquid crystal shutter and the polarizing glasses. ColorLink has been the premier but somewhat problematical supplier of these key optical components to Real D. The relationship was problematical because ColorLink had the potential of offering similar technology for sale to Real D competitors. Worse than that, ColorLink had the potential to go (at least in part) into direct competition with Real D. A separate issue recognized by Real D was the need to continuously improve on their existing 3D projection technology. Real D believed this need was inadequately served by the capabilities of their small in-house effort.

The situation at ColorLink was quite different.  A technological powerhouse, ColorLink has spent years looking for a killer application for their optical solutions.  In recent times, ColorLink had apparently been struggling to grow their traditional business based on the design and sale of optical components for projection TV and sunglass.  A shift was made a year or so ago to refocus the company efforts on the creation of technologies and products for 3D applications.  Although this was a logical extension of and application for ColorLink’s core technologies, it put them in a business in which other companies had found it difficult to make a buck.  It looked like it was going to be a tough row to hoe for the ColorLink team.

To those of us on the outside looking in, it appears that the acquisition of ColorLink by Real D seems to successfully address the needs of both companies.  Those are the kinds of deals that work.  In fact, this acquisition may well turn out to be important to the entire 3D industry.  But it is clearly an important factor in enabling 3D cinema and bringing it - for the first time - to a sustainable, true mass market.

The acquisition includes ColorLink’s R&D office in Boulder, CO as well as their manufacturing facilities in Tokyo and Shanghai.  Mr. Leo Bannon, the President and CEO of ColorLink will assume the role of COO of Real D.  The financial terms of the deal were not announced.