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Dolby and DTS complete major acquisitions

DTS has finalised the $148 million take-over of SRS Labs, while Dolby Laboratories has purchased Imm Sound for an unnamed amount.

DTS has finalised the $148 million take-over of SRS Labs, while Dolby Laboratories has purchased Imm Sound for an unnamed amount. SRS Labs established itself in the multi-channel audio market by developing technology licensed by other manufacturers in the computer, home entertainment and in-car markets. During 2012 SRS Labs launched a new range of technologies, including iWOW-U, an “audio enriching universal adapter”, and was promoting its Multi-Dimensional Audio (MDA) object-based open platform. Despite this profile the California-based company had been put up for sale and DTS began the acquisition process in April. Jon Kirchner, chairman and chief executive of DTS, comments that the deal brings together “two highly complementary product and technology portfolios”. The combination of DTS’ audio systems and SRS Labs’ processing tools will create, he says, a broad offering and address the sound quality problems caused by the appearance of thinner, smaller devices, such as mobile phones and tablets. “We can significantly enhance audio for films, music, video, games and general entertainment,” he adds. “The addition of SRS Labs accelerates our move towards this goal by having a large base of intellectual property.” Dolby’s bid for Imm Sound was primarily based on securing its position in the emerging immersive cinema audio market. Dolby is targeting this sector with Atmos, a prototype object-based system announced in April. Imm Sound’s technology, based on additional loudspeakers in the ceilings of cinemas, has been installed in theatres in the US, France, Germany and Spain since 2010. The company also produces a post-production system, IAW (Immersive Audio Workstation), which works with Pro Tools. Doug Darrow, senior vice president of cinema at Dolby (pictured), says the acquisition of Imm Sound had been underway for “the last few months” and came out of monitoring changes in the market. “We saw a progression from widescreen to digital projection, 5.1, 7.1 and now 3D,” he explains. “We feel the next generation will be more immersive audio and by combining Atmos with Imm Sound and investing in object-based mixing we can give a joint format that brings the best solutions to the market.” Imm Sound’s base in Barcelona will be retained but the brand and its technologies are to be integrated into the overall Dolby offering. Darrow says right now Atmos is aimed squarely at the theatrical market and work on integrating Imm Sound technology into it will lead up to a full launch next year. Existing Imm installations will continue to be supported, with a new film in the format, The Impossible, due for release in October. During CineEurope in June Dolby announced that the first European Atmos equipped cinema will be the Cinesa Diagonal Mar Screen 9 in Barcelona. DTS is not initially expecting to make any brand changes following the acquisition of SRS Labs. “We believe both have their own equity and they operate in different geographical areas,” says Jon Kirchner. “Over time we will build a brand and technology road map. But there are different positions for both DTS and SRS as far as consumers are concerned.” He confirmed that SRS’ headquarters in Santa Ana will remain in operation. Dolby buying Imm Sound has echoes of its 2007 acquisition of Coding Technologies, which had been working with DTS on new low bandwidth broadcast surround sound systems. This latest move clearly ensures it has key technologies in its new target market, immersive cinema sound, but DTS is looking to other sectors, including mobile and TV. These commercial developments say more about the perceived importance of audio for 3D in cinema and on TV, as well as the burgeoning mobile markets, than they do any rivalry between Dolby and DTS. They are still competitors and there is crossover in activities but each has also targeted specific sectors for growth and innovation. How significant these acquisitions really are will be shown by how others in this niche sector react.