C2Mmonthly

Weijie Yun, Telegent CEO discusses the factors for consideration and the best model to adopt to accelerate the growth of mobile television.

The debate continues to rage within the mobile and broadcast industries on the best model to adopt for mobile TV. Which mobile-specific broadcast technology will win through? What do consumers want? How do they want to pay? These are just a few of the questions which are still yet to be answered in the mobile TV debate. The EU has been pushing for common adoption of DVB-H for some time and in March this year, announced it was backing DVB-H as a common standard for Europe recommending strongly to all involved within the region to follow a DVB-H model. However, Vodafone has been, and T-Mobile will be, introducing DVB-T enabled handsets in Germany so some industry players are still questioning whether the EU has made the right decision.

Recently it was highlighted in C2M that a significant number of European countries still need to make decisions to be able to exploit the current market potential of mobile TV (according to a recently published study conducted by the Broadcast Mobile Convergence Forum). It concluded that a significant number of countries are still lagging behind most advanced countries in defining their regulatory framework including the licensing conditions and processes. The lack of a common adoption model is telling – there is still much uncertainty about which direction to take.

Holistic view
Let’s step back a moment and consider what needs to be addressed to make mobile TV a success. There needs to be market demand, compatible devices with technology which can support mobile TV, a network infrastructure which can deliver broadcast content to mobile phones, the right pricing model and the most important aspect – the right content. As with most mobile applications, consumers are not interested in the technology – it is all about content. Copyright and content licensing issues make the redistribution of local programming over the new emerging digital standards problematic. As a result, content delivered over these standards by necessity has to be newly developed, re-tooled, or licensed which can be quite expensive. To date, digital mobile TV uptake has been slower than expected because consumers are reluctant to pay subscription fees for a limited number of channels delivering unfamiliar content.

In contrast, free-to-air mobile TV, because it harnesses free-to-air broadcast standards, is able to tap into the existing television content ecosystem and make local programming available to consumers – for free. Having access to live, familiar programming is a more immediate way to entice consumers to take up the mobile TV feature and integrate regular viewing into their daily routine, enabling mass uptake. The power of traditional broadcasting is made evident by the fact that even in markets where there has been considerable investment made by cable and satellite industries and their content partners, free-to-air broadcast programming continues to dominate viewing figures.

Revenue opportunities
For the mobile operator, free-to-air mobile TV does not mean abandoning feature-driven revenue goals. Although many continue to equate monetisation of the mobile TV feature with subscription fees, the content made accessible by free-to-air mobile TV can serve as a platform for the development of a broad set of revenue opportunities. These opportunities include revenues derived from increased voice and data consumption, voting via phone or SMS, and targeted advertising. And, free-to-air mobile TV can also pave the way for subscription services. Once consumers become accustomed to watching TV on their handsets, they will be more willing to subscribe to premium pay TV services that can be tailored to them. It is often getting consumers to try a new service which is the biggest hurdle.

An additional incentive for operators to offer mobile TV services is the impact it can have on handset subsidies. Consumers are already paying a premium to get free-to-air TV-enabled handsets in Asia, the Middle East and Africa. The ability to reduce handset subsidies can be a short-term incentive while mobile TV becomes established, but nonetheless one that eases the investment in new handsets. Additionally, because mobile TV has been shown to have a strong influence on consumer purchase decisions, operators can think about free-to-air mobile TV as a mechanism for recruiting and retaining subscribers.

Delivery of mobile TV using free-to-air broadcast standards was once thought to be an insurmountable technology hurdle. However, technology innovation with respect to single-chip television architecture has now made it possible to provide mobile handsets with direct access to high quality TV services using existing broadcast infrastructure and standards. This opens up avenues where both free-to-air and digital broadcast mobile TV may play complementary roles in driving mass uptake and delivering consumer value. And, with free-to-air mobile TV handsets now available on the market, consumers who are interested in mobile TV can finally gain access to the programming that is most interesting to them.