This week RealD has it’s IPO (initial public offering) that opened at $16/share, and managed to pull in an impressive $200M over 12.5Million shares, up from the expected 10.75 million. Analysts are mixed as to what this means for 3D movies, as more 3D movies keep coming out but sales seem to be dropping (Toy Story 3 only pulled in 56% of revenue from 3D). In the announcements, I found this interesting little tidbit on how RealD has managed to edge out all their competition in becoming the #1 source of theater 3D.
RealD has vaulted to success by offering theater owners a free upgrade to 3D, and then charging them a license fee. That fee had been 75 cents per attendee, but it has since fallen to between 40 cents and 50 cents, BTIG said in a report.
Hollywood studios are subsidizing the cost of RealD’s glasses at theaters, but BTIG said it expects Hollywood to shift that burden to RealD and the theater owners.
Well now you know why you’re paying extra for those 3D tickets, it’s straight to RealD to subsidize the upgrade.
