Mobile TV

Friday, January 12, 2007

2007: The year of mobile TV

Providers are scrambling to let consumers take the boob tube to go - but are we willing to pay up for the privilege?

(c) Business 2.0 Magazine

Will 2007 be the year American consumers can finally watch live football wherever and however they want? Judging by the onslaught of mobile TV-related announcements and demos (the majority of which made reference to the current football season) at this week's Consumer Electronics Show, the answer is a resounding "Yes."

But just how much will even the most hard-core football fans - or even just your average TV addict - be willing to pay to carry their content with them wherever they go?

One of the biggest CES announcements, made last Sunday, was that Verizon Wireless would soon launch live, full-length television programming, including hits such as Fox's "24" and Comedy Central's "The Daily Show" on cell phones. Verizon's calling the service, powered by Qualcomm's MediaFLO technology, V Cast Mobile TV.

The company won't say just how much they will charge for the new offering, but subscribers to Verizon's current V Cast service, which offers access to videos and music, already pay $15 a month, on top of the price of a voice plan. And it's not clear just how much more they'd be willing to shell out.

"You've got a bit of a disconnect between the current pricing of these services and the fact that this is still an early phase in the market, and there is somewhat of an unwillingness to pay up on the consumers' end," says Linda Barrabee, an analyst with the Yankee Group. "The mobile market is still primarily about voice, then messaging."

According to Barrabee, an estimated 5.3 million wireless users - a mere 2.5 percent of total subscribers - currently subscribe to video services. Of course, that number will probably grow, but just how much will depend on what mobile TV services cost and how easy they are to use.

"It all comes down to form factor and price point," Barrabee says. "Unless it's easy for the consumer to use, mobile TV will continue to be an experience for early adopters only."

But companies like Verizon are hoping to reach far beyond the early adopters.

One way they may be able to do that, says Barrabee, is by letting subscribers test a service before they commit, and by offering them several ways to pay up.

Verizon's already done that by recently launching pay-by-the-day access to V Cast videos and music. The service costs just $3 a day, and users don't have to commit beyond a single day. This approach could work especially well with the youth market - the type of TV-loving, yet cost-conscious customers that V Cast Mobile TV is likely to attract.

Another way around the pricing problem is an ad-supported, or at least partially ad-funded, model. That could be what mobile television service provider MobiTV has in mind: Monday at CES, the Emeryville, Calif. based company announced it will soon add an interactive advertising component to its mobile television technology, which powers the mobile TV services for Sprint Nextel and Cingular Wireless.

MobiTV will enable advertisers to send out promotional coupons, WAP-based surveys and contests, and deliver localized ads based on users' zip codes. The company says it currently has over one million paying users. And if advertisers start snapping up interactive ad space on MobiTV's service, that could provide Sprint and Cingular some additional revenues, lowering mobile TV subscription fees for users.

Samsung also jumped on the mobile TV bandwagon at CES, announcing on Sunday its new mobile television standard, dubbed A-VSB. The Korea-based company says that the new technology will enable local broadcasters to transmit a mobile digital TV signal on the same frequency they now use for standard broadcasting, meaning they won't have to buy up additional spectrum.

By transmitting the signal that way, consumers will be able to watch live, local broadcasting on any A-VSB compatible mobile devices (which Samsung intends to sell soon as the new standard is adopted), even while traveling at high speeds.

"You could say we're liberating the couch potato," said John Godfrey, vice president of government and public affairs at Samsung, moments after the company unveiled the new technology in Las Vegas.

But just how badly does the couch potato want to be liberated? And at what price?

In places like Korea, where Samsung is based and where mobile TV has already taken off, nearly 14 percent cell phones support Digital Mobile Broadcast television, according to ABI Research. That's a high number, compared to most other countries, except maybe Japan.

But ABI Research expects mobile TV will be someday be a cash cow globally as well. According to the firm's forecasts, there will be half a billion mobile video subscribers by 2011. What was a $50 million industry back in 2005 will be worth several hundred billion dollars by 2011. And ABI believes advertising revenues from broadcast mobile video will dwarf subscription revenues from these services.

If Korea is any example, then mobile TV just might become the booming business ABI Research projects it will be. After all, we are a nation of TV addicts.

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Thursday, January 11, 2007

New Content Missing From New TV Services

Telco TV was supposed to be the stage for startup content, but so far it’s just old faces in new places.
The hot blast of IPTV and mobile TV announcements blowing out of the International Consumer Electronics Show this week seems to be missing one critical element. Where are all the new startup content providers that were supposed to be ushered into the mainstream by IPTV and mobile TV?

It’s the same content packaged in new technology wrapping. Most of the IPTV and mobile TV announcements have had the same old names attached to them: CBS, NBC, ABC, Fox, Comedy Central, Discovery Channel, Nickelodeon, and MTV.
There is little in the way of channels dedicated to customer-generated video, à la YouTube. There are few if any immigrant ethnic programs being featured. Where are the local channels devoted to Japanese-American programming, or Middle East news?
Granted, CES is devoted to flashy new devices, but the presence of telecommunications vendors pushing emerging services such as IPTV and mobile TV does make it partially about content.

Old Business Dies Hard
“The telecom companies are limited in what they can offer so they cater to the mainstream,” said Chris Wagner, executive vice president of marketplace strategy at NeuLion, a Plainview, New York-based iPTV specialist.
NeuLion, a two-year-old startup that distributes TV content over the Internet, targets niche markets such as immigrant communities, religious communities, and other areas overlooked by the major distributors such as cable TV.
“Traditional TV distribution does not focus on the long tail,” Mr. Wagner said. “The content providers and the cable, satellite, and now telecom distributors do business a certain way and it’s tough for them to change that.”
At Verizon’s launch of its V CAST Mobile TV service at CES, a question posed about local programming went unanswered.
Verizon’s fiber optic IPTV service, FiOS TV, does include about 15 channels of ethnic programming, including channels devoted to the Russian, Chinese, Polish, and Korean communities, among others.
It also includes numerous Spanish language channels, but the promise of new or imaginative content from startup content providers seems to be missing.

Telco TV
“Telco TV is nothing more than a way for telephone companies to get their triple play of voice, data, and TV,” said Mr. Wagner. “For years they lost out to the cable companies on triple play, so the phone companies got into the TV business.
“They are focused on the same programming as the cable TV companies because they want the consumer to make a price decision,” he added. “They are not focused on niche markets because many of them are still geographically limited. You can’t build a business in the New York market on the 100,000 Japanese residents in your area.”
But NeuLion, which transmits its programming over the public network and does not have the massive overhead expense of a multi-billion dollar network, can.
“The true promise of IPTV will be realized through companies such as ours,” Mr. Wagner concluded.
NeuLion’s programming includes a news service for the Chinese community, TV targeted at the African community, and most recently a business channel for the Hawaiian community.

(c) Red Herring