His name can be found on almost every stereo in the country, but none of the young Internet entrepreneurs wolfing down lunch recently in a fashionable restaurant in San Francisco's booming Multimedia Gulch recognized Ray Dolby. Which is how Dolby prefers it. Dolby projects about 2,500 theaters in North America will have Surround Sound in time for Star Wars. The company also is producing a version of the technology for home stereos, high-definition TVs, DVD movie players, multimedia PCs, and portable headphones. Dolby is betting that consumers will want a sound system that matches the high visual quality of the upcoming generation of gadgets.
Computer games are great, but the accompanying audio is just in plain stereo.
Dolby doesn't sell its technology directly to consumers. Instead, it licenses its Surround Sound to consumer electronics firms, computer makers, and even Internet companies. The rest comes from equipment sales to recording studios and movie theaters. In the consumer market, Dolby's strategy isn't likely to pay off soon. But Dolby Laboratories, with no stockholders to appease, is looking toward a longer time horizon when prices are expected to drop.