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Dolby Laboratories at 40


Without a doubt, the best-known name in audio is Dolby. It seems to be everywhere, from automobile sound, boom boxes and DVDs to broadcast programming and cinema marquees.

Ray Dolby, circa 1966, working on a Model A301 noise-reduction unit

Company founder Ray Dolby has lived and breathed audio since his earliest years. While in high school, he worked at Ampex, first doing mundane chores such as copying alignment tapes for the company’s new 200A tape recorder, and later signed on full-time as part of the team that developed the first pro video recorder.

After earning his B.S. in Electrical Engineering from Stanford in 1957, he did postgraduate work at Cambridge, receiving a Ph.D. in Physics in 1961, followed by two more years of advanced studies. Dolby then spent two years working for UNESCO in India, during which time he considered ways of applying his thesis findings (on means of improving X-rays for clearer images) to noise-reduction methods for audio.

In 1965, he started Dolby Laboratories to develop systems for reducing the background noise inherent in tape recording. The company’s first product was the A301, which debuted in 1966 and provided one channel of A-type noise reduction. This sophisticated audio compression/expansion system dramatically reduced background hiss inherent in pro recorders without discernible side effects.

The effect of Dolby noise reduction on the audio community — consumer and pro — was profound. It opened the possibilities of narrow-gauge/low-speed recording on formats such as cassette tape and pro video recorders; home VCRs would follow later. But on the pro audio side, Dolby noise reduction helped fuel the fire of a multitrack recording revolution.

The demand for Dolby noise reduction led the company to develop licensing agreements with manufacturers of consumer products beginning in 1968. This formation of Dolby’s licensing division was a stroke of financial genius. Today, Dolby maintains licensing liaison offices throughout the world, and licensing — both from partnering with content makers and providing solutions to licensees — represents about 70 percent of the company’s revenue.

The 1950s brought occasional film releases using four tracks of stereo sound on magnetically striped film stock — mostly for limited first-run engagements in larger cities. Unfortunately, these stereo film releases were rare, as mag-striped prints were fragile and expensive and distributors had to maintain inventories of mono and stereo prints.

Everything changed in 1976 with A Star Is Born, the first film released with a Dolby Stereo optical soundtrack with surround. The format used phase matrixing to store four channels (L/R/C/S) onto a 2-channel format, which, in this case, was two closely spaced optical tracks on a standard 35mm film. The beauty of the system was compatibility: A 35mm Dolby Stereo film could be played anywhere, whether in a non-Dolby mono drive-in or in a theater upgraded with Dolby cinema decoders and a 4-channel playback system. And, with no appreciable cost increase in manufacturing stereo prints, film studios were receptive to the idea.

In 1977, the success of blockbusters such as Star Wars and Close Encounters of the Third Kind helped push exhibitors into upgrading to the new format. The tens of thousands of Dolby Stereo tracks encoded onto Beta/VHS HiFi video releases laid the groundwork for a revolution in home theater, fueled by the arrival of Dolby Pro Logic — equipped multichannel components in the years to come.

Unveiled in 1986, Dolby SR (Spectral Recording) combined both the fixed- and sliding-band technologies invented for the earlier noise-reduction systems. The result was expanded analog dynamic range performance that rivaled the best pro digital recorders, which extended the life of analog recorders. Dolby SR also ushered in a new state-of-the-art analog optical film soundtrack, which is used on the vast majority of releases — including those that also have digital soundtracks — for backup and compatibility.

Dolby began getting involved with digital bit-rate reduction in 1984 with the debut of its first digital coding system, Dolby AC-1, which was adopted by a number of direct satellite broadcast and cable distribution systems. This system was followed by the Dolby AC-2 in 1989, used in the Dolby Fax system, allowing high-quality, point-to-point transfers via ISDN lines for file transfers between distant studio facilities.

“Along the same time, digital sound on film came out, so the first implementation for Dolby Digital AC-3 was multichannel film in 1992,” says Tom Daily, Dolby’s marketing director, professional division. “We took that and evolved it for broadcast and DVD in the early ’90s. Dolby Digital continued to evolve with improvements, most recently with Dolby Digital Plus, which adds more channels and supports more data rates — higher and lower.”

With the popularity of DVDs and surround sound for films, broadcast, cable, games and new formats, Dolby’s future looks bright. “One thing we’ve been working on over the past five or 10 years — and will continue to develop,” adds Daily, “are tools for content-creation authoring and video formats and tools for audio production in those areas. Especially with formats like HD DVD and Blu-ray coming out, we want to give authors all the tools and capabilities they need to add value to these formats.”

And that future is here. For a sneak peek at Dolby Media Producer, Dolby’s new software suite for content creation, see page 150 or visit Dolby online at