Tag Archives: mobile TV

In CommunicAsia 2009: Making Mobile TV Work

communicasia2009

It is more than one motnh ago that I was in CommunicAsia  for a Mobile TV panel. Here are the main points we discussed about how to make the business case for Mobile TV work.

  • Free-to-Air channels are a must to drive adoption of Mobile TV into the mainstream, as Japan One Seg, Korea T-DMB and even the DVB-H Italian case show. More than 20 million Japanese watch TV on a phone. As of today, 85 % of the new handsets sold in Japan have a One Seg tuner. Even the iPhone has an One Seg tuner accesory (see picture)
  • “Free” creates a large audience that can be monetized through subscriptions, advertisement and transactions (VOD, Catch-up TV, cross-selling). It is the economics of free, common in Internet and Software, applied to Mobile TV.
  • There is a need for a next-gen Mobile TV that puts together Broadcast and Unicast technologies. Broadcast enables FTA channels at zero marginal cost (it is the same cost to serve one customer than one million) and it is efficient for premium mass audience channels like sports channels. Meantime, Unicast provides unlimited number of channels for premium, niche/long tail, VOD and catch-up TV that can be monetize as subscriptions or pay-per-download. The 3G network also enables interactive services, like EPGs, audience monitoring, interactive ads, or interactions with social network (see what my friend watch, or “watch and chat”), that give extra chance for monetization.
  • Focus on high-end devices, like iPhone or ones with TV tuners. Early adopters of these devices are the same early adopters that will watch TV on a mobile. It is a waste to support a large number of mid-range or low-end devices. Mobile TV has not crossed the chasm yet.

1seg-iphone1

Some other curious facts and learning from the Japanese One Seg: Mobile TV experience:

NHK Study: Where people watch mobile TV?
1) At home in a room wo TV 38%, 2) At work/school 26%, 3)While bathing 24% – On train goes in 7th place (17%) tied with at home in a room with a TV!
=>  There are more use cases than just watching TV on the train…

DIMSDRIVE research for Japan:
What people like about Mobile TV: 1) Anywhere, 2) free, 3) simple
What they do not like: 1) Battery, 2) don’t need to watch TV outside, 3) do not want to watch TV on a phone

One Year of Blogging

One year has passed since we started this blog with Steve Job’s famous commencement address.

Less than one month later a post on LinuxMCE made it to the front page of Digg, and got 25.000 visits in one day!

Since then, we have spoken about iPhone, Android, Mobile Internet, Mobile TVIPTV, Internet TV, the economy of freenetbooks, WiMAXclouds, pipes and even nanotechnology. We have also echoed from great entrepreneurs as Guy Kawasaki, Tim Ferriss or Martin Varsavsky.

It has been close to 200 posts, 250 comments, 139.000 visits and 260.000 pages.

Thank you for being there.

Note: Did I mention we also wrote about iPhone?

Are Handsets with a TV Tuner Killing MobileTV?

LG launched a few months ago the LG HB620T, a mobile phone that includes a TV tuner for DVB-T, the most extended standard for terrestrial digital TV. Many analysts predict that this kind of phones will kill broadcast mobile TV standards such as DVB-H/SH or proprietary MediaFlo. Why do you need a standard for mobile TV when you can already have regular TV in your phone?  Leaving apart that DVB-H/SH technology is fit for mobile (limited battery, processing, authentication with SIM card) the answer is because it enables Pay-TV.

One of the advantages of DVB-T is that it is already available in many countries offering a wide number of channels free-to-air. And this is good news for users and for Mobile TV too. Educating the customer to new services is always the most challenging part of new technology adoption.

Free TV on the handset is the mandatory first step for Mobile TV to take off.

Cable, IPTV and Satellite Pay-TV did not succeed well after we all had first a TV set in the living-room. For Mobile TV, DVB-T on the handsets is the best thing that can happen to get users familiar with TV on their mobile phones. Once there, it will be less disruptive for users to pay for premium channels for which DVB-H/SH and its OMA BCAST smart card or DRM profiles will be required.

The First Step for Mobile TV is Free-To-Air

Internet and Software companies know it well: mass adoption comes first, revenues will come later. It is what Chris Anderson calls Freeconomics. When the marginal cost of every new subscriber is close to zero, free is the way to go: Freemium, Ads or Cross-subsidize models can later monetize a massive audience base.

Mobile Operators are not familiar with the economics of “free”, but for Broadcast Mobile TV, Free To Air is a wise first step to create awareness and push for mass adoption. The Korean authorities forced T-DMB spectrum licensees on a free-to-air business model. T-DMB had 5 million users by year end 2007, compared to 1 million users of the S-DMB satellite pay-TV model launched earlier.

DVB-H service providers, like 3 Italy, are now switching to offer free-to-air channels, as well as different packages to access premium content, such as Pay-TV subscriptions and pay-as-you-go:

  • MOBILE TV TARIFFS OF 3 ITALIA: Daily, weekly or monthly packages, with or without other services included. Pay-as-you-go users can access the mobile TV service at €4 per day, €9 per week, €19 per month or 29€ for 3 months. Alternatively, subscribers can pay €29 per month getting free access to all digital mobile TV services, access to 3 Club on 3 Mobile Portal, free national calls and one GB/month of mobile broadband Internet. As of June 2008, RAI 1, RAI 2, Mediaset, Sky Meteo 24, Current TV and La3 are made available free-to-air to those with DVB-H receivers. La3 is an in-house channel, showing sports, music and entertainment programming.

The bigger the base of Mobile TV handsets and users, the bigger the market to up-sell premium content (including pay-per-view), or to get advertisement revenues for zapping ad insertion, as an example.

In broadcast television, Pay-TV models (like Canal +, or cable TV) only came decades after free-to-air television was watched by millions, sponsored by advertisement. Once every house has at least one TV-set , today Pay-TV is a popular model and a (very) profitable business.

The adoption of new technologies takes some time, specially when handset renovation is required. “Free” is an excellent choice for Mobile TV providers to create a mass audience first. Premium content will come soon after. The good news is that being a broadcast technology, it is the same investment to build nation coverage for one user that for ten million.

Mobile TV related links:
Faultline: “Free to air mobile TV has won – the war is over” — MobiTV
Searching for a Mobile TV Business Model
Mobile TV must be free-to-air-service
3 Italia – TV Digitale Mobile DVB-H

Broadcast or Unicast Mobile TV? Both

Mobile TV continue to expand in Asia, Europe and US. AT&T just launched a broadcast Mobile TV service, offering 10 channels for $15 a month. Verizon launched their service one year ago. In Italy UMTS mobile operator 3 (Hutch group) is the most successful commercial launch in Europe for Broadcast Mobile TV with 800.000 subscribers and an offer of 12 channels at 19 Euro per month. Japan is the world leader with 20 million mobile broadcast subscribers, followed by Korea with 8 million.

Broadcast Mobile TV technologies require an overlay network to the mobile cellular network, using a different spectrum to broadcast digital TV channels, and specific handsets equipped with “TV tuners”. This is a very effective way to reach a mass audience of mobile devices for a limited selection of a dozen of channels. (See video example of AT&T service on an LG Vu phone)

Mobile Operators are also offering Mobile TV in unicast using the 3G mobile network infrastructure and spectrum to deliver video through an unicast stream over IP. The most sophisticated services use a software Rich Media Client in the handset that enables a better user experience and more interactivity (see video example of Orange World Mobile TV)

Once of the advantages of unicast Mobile TV is that it enables an unlimited number of channels. Each user receives a dedicated stream delivering his video choice from an on-line catalog that includes Video On Demand, recorded TV shows, pre-recorded interactive channels or live channels.

In short Broadcast brings a few mass TV channels, and Unicast brings unlimited choice. Which option should mobile telcos choose? Unicast can complement a Broadcast Mobile TV service with a wider choice and VoD on top of the 10-12 channel package. So why not integrate both options in the same Service?

Broadcast Mobile TV trials in Spain

Enrique Dans, one of the most influential bloggers in Spain, posted some interesting data about the Broadcast Mobile TV trials run by Abertis in Spain with each of the main mobile operators. Here is the translation:

“There has been three trials in Spain, run by Abertis, using Nokia 7710 handsets:

  1. Telefónica in Madrid and Barcelona from September 2005 to February 2006: 500 users, content from TVE1, TVE2, Teledeporte, 24H, Cuatro, CNN+, Jetix, 40TV, A3, Telecinco, FDF, TV3, Telemadrid, LaOtra and Intereconomia. 55% of the users said they would continue with the service for a price of €5/month, 75% would recommend it. Average usage was 16 minutes per day, with 71% between 15 ans 20 minutes.
  2. Vodafone in Seville and Valencia from December 2005 to March 2006: 300 users, content from Antena 3 TV, Net TV, Sogecable, Telecinco, Canal Sur, RTVE, Canal Nou and Veo TV. 80.08% would recommend the service, 80% considered it was easy to use.  Average usage 35.39 minutes/day on weekdays and 37.90 minutes/day om weekends.
  3. Amena (now Orange) in Zaragoza and Gijón from March to July 2006: 200 users, content from TVE1, Teledeporte, Canal 24h, Tele5 estrellas, Nova, Neox, Cuatro, 40 latino, CNN+, Net TV, Veo TV, Aragón TV and TV Asturiana.”

The results of the trials were quite promising in terms of usage and user experience. Since 2006 there has been serious improvement in the user interface, with the use of more sophisticated Rich Media Clients and a wider variety of handsets available. Rich Media Clients are Software clients installed in the handsets that allow for a more intuitive usage and better interactivity, including Electronic Service Guide. Therefore, expect a better user feed-back than two years ago.

The price model that we can foresee for Mobile TV is based on subscription. Since DVB-H and DVB-SH are broadcast technologies, there is no reason to charge based on usage the way 3G operators do today on unicast model, where the spectrum is occupied by a unicast channel for each user. All-you-can-eat model based on a flat fee is what broadcast Mobile TV technology enables.

Many Mobile operators deploying DBV-H/SH will have a hybrid model with both broadcast (for mass channels) and unicast (for video on demand and catch-up TV). We can foresee pricing models such as :

Basic fee with access to Free-to-air TV broadcast channels (under 5 Euro/month)
Premium broadcast channels to be subscribed individually or in bundles (1-3 Euro per individual Premium channel, and 5-10 Euros for bundles)
Video on demand over unicast channels with pay-per-clip or with subscriptions to Video on demand “channels”

Although there is an investment to build an overlay DVB-H/SH network for broadcast Mobile TV, Mobile Operators are in an unique position to take a share of the entertainment market:

– They own the mobile phone users and have a trusted billing relationship
– Mobile Operators can provide a broadcast and unicast combined package to users 
– 3G Operators can re-use sites and antennas by deploying DVB-SH in a band adjacent to UMTS

Mobile TV is getting closer to our pockets.

DVB-H: Mobile TV Standard in Europe

The European Union has selected DVB-H as the standard for Mobile TV in Europe. Although the decision is not binding for EU countries, it aims at stimulating the technology adoption, by avoiding a standards war where end-user pays the casualties – ask anyone that invested on a HD DVD player. GSM worldwide success came after being backed by European authorities.  DVB-H, and its evolution DVB-SH, are likely to follow a similar route.

See comparison table between Mobile telephony and Mobile TV standards:

Region Mobile Telephony standard Mobile TV standard Comments
Europe, Middle-East, Africa GSM / UMTS DVB-H, DVB-SH Standards driven by international bodies
Americas CDMA, later GSM/UMTS growing MediaFlo and DVB-SH deployments Qualcom proprietary standards initially getting ground and later decreasing
Asia Pacific PHS, CDMA and GSM/UMTS DMB in Korea, ISDB in Japan, DVB-H in rest Japan and Korea pioneer with local standards, later displaced by global standards as UMTS

As can be predicted from the table and in line with GigaOm post, MediaFlo is likely to be relegated to US and DMB to Korea, both sharing market with DVB-SH/H.