The Prospects For Mobile and Internet TV

As viewers shift from consuming their TV fix via traditional linear platforms to on-demand and mobile devices, James Myring, associate director at Continental Research, examines mobile and IPTV and decides which broadcast method has the brightest future…

TV is facing its greatest change since the advent of multichannel TV.

The growth of convergence technologies means that consumers can now watch TV through the alternative platforms of a mobile phone and online via broadband. However, just because we can watch TV online or on our mobiles does not mean we will – at least not in significant numbers. To best determine the future success of mobile and internet TV (IPTV) it is best to look at what they offer consumers.

The key advantage of mobile TV is that we can watch on the move, ‘anywhere, anytime’. However it remains to be seen if this USP will suffice. Given the current limitations of mobile TV it is unlikely people will choose to watch mobile TV if a traditional TV is available. This does somewhat limit the niche for mobile TV to times when travelling on public transport – of less use to the majority who drive, walk or cycle to work, or indeed to those underground on the Tube.

Providing mobile TV free in return for receiving advertising offers perhaps the best route for boosting the numbers watching mobile TV. However, the obstacles detailed above mean that it is difficult to see it fulfilling much more than a niche viewing role in the medium term. The most desired type of programming is likely to be very short clips, targeted at a teenage/early 20s audience who spend a lot of time out of the home.

There are also still technical problems with mobile TV to overcome, users cite dissatisfaction with the size of the picture, cost, and in particular the choice of programmes available to watch and the geographical coverage in which you can receive the service. This last point is important as train and coach or bus journeys provide ideal opportunities to reach an audience with considerable free time. However, the 3G signal required to receive the transmissions can be patchy.

The prospects for internet TV look greater. Crucially, internet TV is offering something above and beyond traditional TV. The key to the success of internet TV is apparent from some of the reasons for watching given by users, for example: ‘More variety of shows than on television’ and ‘It lets me see the American shows before they come out in the UK’ are typical of reasons given. Given the popularity of downloading first music and now films via the internet, there is every reason to predict that watching TV online will grow rapidly in importance.

In particular the internet has the potential to act as a huge TV library, where old shows can be stored and the viewer can watch at a time that suits them, removing the need to store videos/DVDs of favourite shows. Whilst a lot of TV (especially for certain categories such as news and sport) is about being current, a large proportion of TV shown is already repeats, and especially in the UK there is substantial nostalgia for favourite old shows.

The advantage of IPTV over other forms of on-demand television (i.e. Video on Demand) is the sheer breadth and depth of programming available. With IPTV it is possible to access programming from any country and any channel (often obtaining it ‘unofficially’) – literally any programme that has been uploaded to any website anywhere in the world. By comparison, to access VoD it is necessary to have a dedicated set-top box from a specific supplier, and the user will only be able to access a (comparatively) very limited range of programming – restricted to what is currently offered by their supplier. For example, in the UK, the most recent high profile VoD supplier to launch is Virgin Media, and they offer ‘just’ 500 movies on demand at any one time.

VoD does in most cases still have two notable advantages over IPTV, namely screen size and quality. However, as more and more users connect their PCs to their TVs and view all their PC (and their internet) usage in this way, this advantage will decline. Internet TV ticks the boxes required for the transition from occasional, experimental use to a technology that is being used regularly and habitually by a substantial numbers of users.

When assessing the relative potential of mobile and internet TV it is also worth recalling recent history. Whilst broadband internet access has revolutionised a number of industries from travel to music, for several new mobile technologies (such as photo messaging and mobile internet access), reality has not lived up to early (over) promise. Not all of the new convergence technologies will succeed and flourish. Generally the winners so far look to be technologies that are based on broadband internet access.

Based on an international survey of early adopters we have produced forecasts for mobile and internet TV. Forecasts were calculated using a model that took into account usage amongst early adopters and anticipated future use. Downloading TV is set to grow most rapidly.