Giving mobile TV another shove

Michael Hedges December 14, 2008

Mobile TV is another brilliant idea conceived at the cash register banking on customers with holes in their pockets. It has been in that pipeline of great uses for the digital dividend for as long as telecom regulators discovered free money selling the digital dividend. Telecoms, reluctantly, are starting to back away.

European Info Society and Media Commissioner Viviane Reding issued asset of ‘guidelines’ for promoting mobile TV (December 10). This follows quite explicit demands in April for national regulators to get on the bandwagon. Commissioner Reding likes mobile TV and wants you to like it too.

Since mobile telecoms sell bandwidth mobile TV promises tons of new cash, necessary as the market for low bandwidth services – phone calls and text messaging – is saturated and competition is pushing price points for basic services ever lower. What is working – somewhere between low and high bandwidth – is IP services via the mobile phone, particularly among under 30 year olds inextricably attached to social networking platforms.

Standards available for mobile TV are sufficiently developed for telecoms to choose one or two and see where the customers go. Commissioner Reding demanded pan-European adoption of DVB-H back in April. Last weeks’ statement appears to recognize regulator and telecom resistance to a mandated single standard and asks only for adoption of “a technical standard such as DVB-H.”  

Broadcasters and producers were excited about the prospect of a mobile platform for video content. That soured when football fans failed to mobilize for mobile TV offerings for the Euro 2006 championships and sports fans generally voted for the big screens to see parts of the 2008 Beijing Olympic Games. A bit of market research showed a difference between what sells on the big screens and what might sell on the tiny ones. Telecoms started to sour as it became obvious that video content appropriate for mobile TV had to be specially produced, ending the idea of simply buying – or pirating - content produced for that other platform.

Given the task of building the communications infrastructure for the 2012 London Olympic games, BT is looking at using the mobile phone “to enhance consumer interaction.” Largely that means payment terminals accessed by mobile phone. Little attention is being given to mobile TV. The light has struck.

What telecom operators continue to resist is exactly the prescription for mobile TV: free-to-see. Commissioner Reding mentioned take-up of mobile TV in Austria, Italy, Finland and the Netherlands.  There have been 5,000 Austrians and 10,000 Dutch subscribing, about 1.5% of the respective populations, the size of a decent field trial. Italians are addicted to their mobile phones and are running out of things to do with them. Finland, of course, is home to Nokia.

But look at Asia, mobile TV proponents say. Mobile TV is very popular in Asia. In a report on the South Korean market the Wall Street Journal (December 8) threw in cold reality. “The free DMB signals from the country's four main TV broadcasters draw the most viewers, yet none of these ad-supported services is profitable.” Pay services “get to be quite expensive” and people “quickly cut back their usage.”

Jupiter Research (November 5) reported that American interest in “broadcast and streaming television services” via mobile devices has “failed to materialize,” adding “consumer interest has dropped substantially in the last two years.”

According to European Commission projections revenue from mobile TV services will be €8 billion by 2013. "With predicted growth in sales during the Christmas period, many more Europeans should have the opportunity to watch TV on the go," projected Commissioner Reding. Few if any European consumer markets are expecting sales growth in any sector this holiday season. Concurrent with that little problem, telecom CEO’s are concentrating every thought on the next three quarters, not on a world that will certainly be different in five years.

The French regulator CSA, in approving a DVB-H plan, hypothesized 30% of French people would be viewing by mobile phone really soon… and 60% sometime later.

The reality that mobile TV is less a revenue-generating service and more a triple-play add-on was evident in a letter sent in mid-November by French mobile operators SFR and Bouygues, reported by RapidTVNews (December 1), to prospective DVB-H content producers who had asked where the money would be coming from. Mobile TV launches in Europe have come to nothing, said the letter.  Look for the money somewhere else.  

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