Broadcasters To Create National Mobile TV Network
Brian Platts, Contributing Analyst
April 23, 2010
In a press release last week at the NAB convention in Las Vegas, Belo Corp., Cox Media Group, E.W. Scripps Co., Fox, Gannett Broadcasting, Hearst Television Inc., ION Television, Media General Inc., Meredith Corp., NBC, Post-Newsweek Stations Inc., and Raycom Media announced plans to form a new U.S. mobile video service. Using existing broadcast spectrum, the service would allow member companies to provide a full range of video content to mobile devices. These broadcasters are also members of the Open Mobile Video Coalition, which includes more than 800 TV stations and has been working for years to establish a single national mobile TV standard.
But delivering broadcast TV programs to handsets is already being done in the U.S. and with very limited success. Is there reason to believe this new approach will be more successful?
Mobile DTV is delivered via the same infrastructure as digital over-the-air (OTA) broadcasts to home TVs but with special enhancements for viewing on mobile devices. So far, 45 U.S. broadcast stations are sending test mobile DTV signals using the ATSC-M/H standard, with mobile DTV service featuring similar broadcasting to fixed DTV. This will kick off in Washington D.C. on May 3, 2010, shortly after which two stations in Detroit will follow.
This is all good news for consumers, though not so good for FLO TV, Qualcomm’s own branded mobile TV service, which recently launched to supplement its resale by AT&T and Verizon Wireless. Neither carrier has seen much success with the service, primarily because it is currently available on a just a few phones. And therein lies the problem.
For mobile TV to gain wide acceptance, it must be available on a wide range of popular devices such as the iPhone, BlackBerry, and Android-based phones. Instead, Qualcomm and DTV broadcasters are relying on the sale of dongles and other after-market accessories that plug into mobile devices to enable their mobile TV capability and allow consumers to receive the broadcast signals.
The first available mobile DTV consumer device is the “Tivizen,” which receives mobile ATSC-M/H TV signals and then re-transmits them to Wi-Fi devices, such as a laptop or mobile phone – effective, no doubt, but hardly an elegant solution. To make matters worse, users must fork out about $150 for the device and remember to take it with them. Qualcomm is expected to introduce similar solutions by mid-2010.
Apple proved with the iPhone that, in order for mobile services to be successful, it must be simple, intuitive, and convenient. That maxim applies to the mobile TV experience just as it does to mobile Internet access. For broadcast mobile TV to flourish, there must be widespread diffusion of handsets capable of supporting the service natively, a feat not at all difficult given today’s miniaturization technology. The challenge is identifying a truly compelling business case for doing so. Manufacturers have no interest in adding capabilities that (a) are unlikely to be used, and (b) unnecessarily drive up costs. Then again, without a variety of appropriately equipped handsets available to consumers, it is self-fulfilling that subscriptions to mobile TV will remain low. Damned if you do, damned if you don’t.
Furthermore, when the time comes to change handsets (at contract termination time, for example) customers typically select a new handset based on price, fashion, and overall appeal rather than for a particular feature of the device that may require an additional subscription (in this case, mobile TV). While dongles and accessories may help indirectly promote the use mobile TV among early-adopters, they will not drive large-scale growth.
Neither DTV nor FLO TV will initially serve rural communities, meaning mobile TV will remain an urban offering for years to come. Furthermore, although the performance of mobile TV service in moving vehicles (think trains and autos) is decent, TDG believes the application will appeal to a very limited market. The result, in our opinion, is that, until native reception becomes a standard feature on most mobile phones, mobile TV uptake will remain sluggish.
Separately, any claims that DTV will somehow provide relief to congested wireless data networks are premature at best. In fact, the reverse could end up being true. If mobile TV remains an “after-market” phenomena—requiring dongles and other appendages—and is embedded in only a few devices, most consumers will reject it out of hand and instead rely on cellular service for mobile video content. As use of the mobile Internet to access “free” online TV websites grows, data usage will accelerate and, in turn, impose increased loads on existing cell networks. It is thus in the interest of mobile operators and device vendors alike to push for embedded support of digital mobile TV solutions.
These and other issues are discussed in detail in TDG’s report “The Possibilities and Challenges for Mobile TV”
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