ESRI continues to make advancements in support of 3D in ArcGIS. At ArcGIS 9.3, there are five areas worth noting.

• Integrated Data Model. ESRI's geodatabase is fundamentally a 3D model for feature information.  It supports both 2D and 3D feature information.  In addition, the ArcGIS geodatabase supports a data type called the terrain dataset which is a triangulated irregular network to describe surfaces.  Terrains can be created by taking 3D coordinates (such as lidar) and/or grids of elevations  of extremely large sizes (e.g., billions of points). The software automatically creates a multi-resolution triangulated network surface that can then be used by ESRI algorithms tools for various types of analysis, visualization, and mapping.  The geodatabase also supports 3D objects, such as buildings and virtual cities. This is done with ESRI’s 3D geometry type known as a multipatch. Multipatch features can be created by extruding 2D polygon features and by reading buildings in from other systems such as 3D CAD, VRML, Open Flight, SketchUp, etc.
• COLLADA Support. At 9.3, ESRI has added support for the COLLADA standard.
• Analytical Tools. ArcGIS 9.3 supports a suite of new 3D analytical tools (i.e., proximity, intersection, etc.) exposed through the ArcObjects API.  At 9.4, ESRI plans to extend this functionality as geoprocessing tasks and end user tools, exposed directly in the user interface. Also at 9.4, ESRI will be introducing a whole series of new tools for 3D editing (moving 3D objects around), interactive texture rendering, terrain editing, and higher performance visual display.
• Better Text and Annotation. ArcGIS 9.3 includes better text and annotation representation (better fonts and text that follows the terrain surface).
• Improved Performance. There are significant enhancements in display speed in ArcScene, ArcGlobe, and ArcGIS Explorer.

Support for 3D GIS in ArcGIS is a key part of our development plans and will continue to grow significantly in future releases.