NewsLine Feature: Tuning In To Mobile TV Revenues
Mobile phone operator O2 recently began its first large scale trial of mobile TV technology, equipping customers in Oxford with Nokia’s TV capable 7710 handset. However, the company may struggle to translate the trial into marketplace success due to several technological and practical stumbling blocks.
According to John Delaney, principal analyst at consulting firm Ovum, the O2 trial fails to replicate a real-life marketplace by allowing free access to mobile TV content.
“A lot of people say they like the idea of mobile TV,” he explained. “They may also enjoy using it in the Oxford trials. But these trials won’t tell O2 whether or not people like mobile TV enough to buy an expensive new phone that can receive it, and to pay regularly to watch it.
“The trialists will be given their phones and will be watching TV for free. Equipment vendors are citing “willingness to pay” surveys to show that people will pay up to £10 per month for mobile TV, but we generally view such surveys skeptically. It’s one thing to say that you’re willing to pay; it’s quite another thing to actually pay.”
Delaney’s standpoint is at odds with that of O2’s chief technology officer, Dave Williams, who predicts that “there will be many millions of mobile TV viewers worldwide by 2010.”
According to Williams, the “latest buzz” in mobile technology is about television, although the new DVB-H technology, standing for digital video broadcasting – handheld, has yet to be fully approved by media watchdog Ofcom. National radio spectrum for DVB-H signals is not yet allocated, and the creation of a national network of transmitters would cost upward of £1 billion. This, coupled with the fact that very few phones support the video standard, points towards a slow start for the medium.
It does not, however, mean that mobile TV is a non-starter. Orange recently unveiled the first usage figures for its mobile-TV service, operating via its existing 3G network, with reality show Big Brother topping the charts as the platform’s most watched show.
Orange also reported customers ‘snacking’ on video content, dipping in and out of live feeds during breaks in the day and typically watching 35 minutes of content each month (see Big Brother Tops Charts For Mobile Viewing).
Delaney concedes that 3G video is probably not the best route for delivering mobile TV, with the technology more geared towards point to point traffic rather than broadcasting. Although the analyst is equally unconvinced that DVB-H can provide worthwhile return on investment.
“We’ll be tracking the O2 trials with keen interest,” he said. “But if they’re successful, that won’t necessarily convince us that there’s a big, quick revenue opportunity in mobile TV.”
O2: www.O2.co.uk