Tuesday, March 15, 2011

Mobile TV fails to deliver

MELBOURNE, AUSTRALIA: Despite the phenomenal growth in smartphone technology, there are still significant barriers to making mobile television a viable and sustainable industry, according to new research from Ovum.

In a new report* the independent technology analyst claims that most attempts to deliver television services via mobile handsets have been unsuccessful, and this trend will continue in most markets due to the numerous obstacles that exist. Linear mobile TV has succeeded in markets such as Japan, South Korea, and Brazil. However, typically these services rely on digital terrestrial television or analogue terrestrial and are delivered free to consumers with the support of regulatory policies.

Tim Renowden, Ovum analyst and author of the report, said: “While viewing web video via mobile handsets has taken off in recent years, the delivery of TV services has promised much but delivered little. At best it has achieved incremental revenues to existing web services, at worst substantial investment write-downs.

“There are a range of issues standing in the way of developing an environment that will enable mobile TV to take off as a successful industry. These range from infrastructure issues and a lack of investment to the simple absence of evidence to prove the consumer use case.”

For broadcasters, mobile TV opens up a new distribution channel for live programmes on a multitude of new devices. This could both complement and act as a competitor to the main living room TV, with potential advertising and premium subscription revenue gains. However, with a long list of challenges to be overcome, it remains a huge risk for television networks.

According to the report, mobile network operators (MNOs) have a strategic disincentive to subsidise handsets with integrated mobile digital TV technology, as it could result in lost revenues for them, limiting handset availability through dominant operator channels.

Meanwhile, unless TV networks are prepared to make upfront investments in content and infrastructure for mobile TV, which many are reluctant to do, consumer demand for handsets will remain weak. These are just two in a long list of barriers that Renowden believes are holding the industry back.

"One possible use for mobile broadcast technologies is in addressing mobile network capacity issues, by offloading high-bandwidth video traffic. The latest telco-led approach is IMB (integrated mobile broadcast), a new standard that lowers some but not all of the barriers to adoption of mobile broadcast services."

Examples of failed mobile TV models include Qualcomm’s MediaFlo network in the US, DVB-H in Europe and a number of 3G-based services throughout Europe, North America and Asia-Pacific.

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