In 1851, Prince Albert organized the Great Exhibition at the Crystal Palace in London’s Hyde Park.

Not only was the building itself a wonder but attendees could also see the most fantastic products available, from an early version of the fax machine to American photographer Michael Brady’s daguerreotypes.

Another exhibit was of an unusual photograph of Prince Albert’s wife, Queen Victoria. The image was presented in 3-D. Attendees were shocked by the technology.

#-ad_banner-#Yet it was almost another 100 years before movie studios came up with the first generation of 3-D technology in an attempt to lure audiences away from their living-room televisions and back into the theater.

A generation later, the advent of digital projection, computer-generated animation and other technological advancements culminated in “Avatar,” which was the first film to be devised specifically for 3-D technology.

This was a game-changer. It’s the kind of watershed moment that gets me in research mode for Game-Changing Stocks.

One of the biggest gambles of the project was Avatar’s producers James Cameron and Jon Landau’s pitch to movie theaters about the advent of a new generation of 3-D content. Digital 3-D projectors and large format IMAX (Nasdaq: IMAX) screens are expensive, and the theater industry works on tight margins. So spending big bucks for a whiz-bang technology that doesn’t have much content is a risky venture, to say the least.

Then, “Avatar” grossed nearly $3 billion. Hollywood and the theater chains saw that the technology had the power to bring in the crowds — some 80% of which shelled out for the premium ticket to see the picture in its intended 3-D glory.

Dozens of other films have since followed suit. Hollywood mogul Jeff Katzenberg of DreamWorks SKG (NYSE: DWA) calls 3-D “the greatest innovation that’s happened for the movie theaters and for moviegoers since color.” Theater chains are spending billions upgrading their equipment.

Demand for 3-D sets and content is growing rapidly
But the opportunity doesn’t end at the theater.

At present, 3-D functionality is becoming increasingly available on many high-end TVs. Last year was the first year 3-D TVs were available. Overall, 2010’s HDTV sales jumped 17% year-over-year, to 247 million sets worldwide; manufacturers sold 3.2 million 3-D sets. The 3-D sets are still expensive, with a price tag north of $1,300, or more than twice the $500 a modestly-sized LCD HDTV goes for.

While 3.2 million of out 247 million is only 1.3%, lower prices and bigger screens will propel the technology forward as consumers begin to replace their first-generation flat screens.

Market watcher iSuppli says 281 million TV sets will be shipped in 2011 — about 14% more than last year — with more and more 3-D sets sold. Research group DisplaySearch predicts manufacturers will ship 91 million 3-D capable sets in 2014 — that would be nearly 30-fold growth from 2010 levels.

Nor is the transformation limited to movie theaters and TV sets.

The gaming world is also embracing 3-D. Activision Blizzard’s (Nasdaq: ATVI) extremely popular video game “Call of Duty: Black Ops” is already 3-D capable, and let’s not forget that some of the biggest opening weekends in entertainment are not at the multiplex but at GameStop (NYSE: GME). The favorite “Grand Theft Auto IV” did $310 million in sales its first 24 hours alone.

Action to Take –> So let’s add this up: The technology is in play. It’s being rolled out at the multiplex, on your TV, on handheld devices and is, at the same time, being embraced from content providers across the programming spectrum. In only a few years, it is expected to have a third of the TV market and a sizable chunk of the box office, as receipt totals already attest. Is there any doubt left in your mind that this is the “next big thing?”

Note: While I think 3-D is game-changing technology, it’s far from the only one out there. If you haven’t already watched (thousands have), I’ve put together a free webcast — “6 Financial Surprises That Will Create Huge Investment Opportunities in 2011.” This presentation discusses some of the biggest game-changing ideas — besides 3-D companies — that I have uncovered for this year. Click here to view it.