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It is predicted that, by 2010, mobile handsets that can receive broadcast TV will outnumber those that simply ‘do’ video by five to one: that’s 124million broadcast TV receiving mobiles in circulation worldwide in less than five years time. Are we on the brink of a revolution in mobile entertainment?
Orange, O2, BT UK Livetime and Virgin Mobile in the UK obviously think so. They have taken these figures - published recently by Informa Telecoms and Media - to heart and are rolling out trials of mobile TV services in various parts of the UK over the summer (see box). Live mobile TV services are expected later this year in Japan and South Korea, some US operators are looking closely at it and Finland and Australia are not far behind either.
This is quite an event. Until recently, the next big things in mobile premium content were music and perhaps video streaming. This move towards offering broadcast TV services, based on a one-to-many model as opposed to the one-to-one approach that video streaming exemplifies, has, to many people, come out of left-field.
As explored on page 15, the reasons for this are plentiful: the network operators want their next helping of lucrative on-portal content and TV companies want to be able to extend their branding and advertising reach out to an even wider, ever-present audience. But what does it mean in practice?
Analysts predict that the services will take the form of clips - sports highlights, news bulletins, cartoons, music videos and ‘mobisodes’ - but what makes this a different proposition from the, until now, popular view that these things would be streamed or downloaded on request is that they are put out in a broadcast format that is then effectively ‘tuned in to’ by the customer.
The benefits of this are that it allows for a subscription model to be built for the services, guaranteeing income and helping cut churn. It also means that the telcos - and their broadcast partners, for that matter - don’t have to rely in overcrowded, spike-prone mobile data networks for the delivery of this content.
In fact, Virgin Mobile in the UK is planning to use the UK’s Digital Audio Broadcasting (DAB) digital radio network to transmit its mobile TV, circumventing 3G and GPRS networks entirely.
If this model is followed elsewhere, it may mean that the mobile network operators (MNOs) are cut out of the distribution side of mobile TV entirely. In the US, it is technology peddler Qualcomm and media company Crown Castle that are teaming up to distribute mobile TV: not a network operator in sight. So where is the benefit for MNOs and, more importantly telemedia players?
"Mobile operators will profit by providing enhanced content over their networks," says Ken Hyers, from US analysts ABI Research. "using the [mobile] network, mobile TV viewers can go back to their operator and buy stuff - ringtones, sports stats, fan club material and so on - linked to the ‘programme’ they have just watched."
The list of revenue opportunities for operators and publishers of this sort of peripheral, TV tie-in content is huge and opens up a whole new market for telemedia.
As Hyers puts it, "This is going to be spectacular. It is going to be worth a lot of money. It is no understatement to say that this is going to be a new goldmine for wireless operators and content suppliers".
But, while mobile TV is generating early interest, there are a number of issues that need to be resolved. "At the heart of the mobile TV industry is the tussle between broadcast and mobile networks to find the optimum way to make this work within what is an extremely complex business model ," says David McQueen, mobile TV analyst at Informa Telecoms and Media. "The degree to which these networks will become either competitive or complimentary will ultimately determine the fate of the market."
In McQueen’s view, collaboration between the players is crucial if the interactive element of mobile TV is to generate the money that ABI’s Hyers is so excited about.
The success of mobile TV is also wholly dependent on the content being desirable.
"There is a definite need for the industry to decide what formats will work for users on the move, based on current viewing habits" says McQueen. "This is further dependent on the availability of quality handsets that provide users with a large, high resolution colour display, a simple user interface and lasting battery life."
But while analysts - and the telcos themselves that are soon to trial these services - see a rosy future for mobile TV, there may yet be one fly in the ointment that they have overlooked: when exactly will people watch mobile TV?
Many pundits view it as the next iPod - a killer application that no one even knew they wanted, but that users will lap up. Not necessarily so. One sobering view comes from Yankee Group’s entertainment strategies analyst Adi Kishore, who says that: "This is not going to be the next iPod. Some people listen to music all the time while they are doing other things, but you can’t do other things if you are watching TV as it needs more immersion."
Author: Warren Pearce
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