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To the moon!: ICO launching mobile video hopes into space

ICO Global Communications Holdings’ half billion-dollar gamble leaves the launching pad this week.
The Reston, Va.-based firm is slated to launch its $500 million satellite into space Monday, setting the stage for the nation’s first space-to-mobile multimedia service. The three-pronged offering is expected to deliver 10 to 15 channels of live video, an interactive navigation service and an onboard, car-safety product similar to OnStar.
But while Verizon Wireless and AT&T Mobility look to Qualcomm Inc.’s $800 million MediaFLO USA Inc. network to deliver video to cellphones, ICO will initially go after a much smaller – but perhaps more viable – market.
“Our emphasis is on large screens; four-inch to 10-inch screens, from DVD screens in cars up to larger laptops,” said Chris Doherty, ICO’s VP of communications. “I think people have been hesitant about mobile video because of the limitations” of today’s handsets, including postage stamp-size screens and limited processing capabilities.

Targeting bigger screens
Indeed, uptake of mobile video – which is to say, cellphone video – continues to plod along. Only 4.6% of U.S. wireless users watch video on their handsets, according to M:Metrics, while more than 13% access the Internet on their phones. And Qualcomm CEO Paul Jacobs last month lamented that the growth of wireless TV has been disappointing as the carriers have held back advertising dollars as they wait for MediaFLO to build out its network.
ICO, which last week announced a $40 million working capital facility agreement, has been testing its technology in Las Vegas and Raleigh, N.C., and will launch trials with its new satellite by late summer. The company’s lone public content partner is NBC Universal.
While cellular users aren’t ICO’s primary targets – the company will initially focus on delivering video to screens in autos – ICO hopes to exploit that lack of a nationwide footprint in each of the three areas. The company plans to market its offering to families, road warriors and anybody else who may not typically stay within major urban corridors where MediaFLO provides coverage; mobile phones will be a secondary market.
“The real challenge for terrestrial operators is, how can you deploy a nationwide service?” Doherty said. “Our differentiator out of the gate is that our satellite covers most of North America” as well as Puerto Rico and the U.S. Virgin Islands.

Package deal
Look for ICO to use that same talking point – its nationwide footprint – as it markets the other two components of its service.
The GPS-enabled navigation will include an interactive component that “allows the customer to be constantly in touch with the device,” Doherty said, while the emergency roadside assistance will include text- and voice-messaging features.
And both will offer customers better coverage than existing, terrestrial services, according to Doherty.

Direct to consumers
ICO plans to market its service directly to consumers, but the key to the company’s success may be forging relationships with potential distribution partners. ICO’s survival may hinge on getting automakers to agree to install compatible hardware in cars at the plant – similar to arrangements used by OnStar and satellite radio providers. Mobile device manufacturers will be crucial, also, if the company is to aggressively pursue the wireless market.
And while the firm is in talks with wireless carriers, ICO can go it alone in mobile thanks to spectrum it secured in 2005, Doherty noted.
“We haven’t announced anything yet, but we’ve been talking to a wide range of carries as well as automotive manufacturers,” Doherty said. “Once we’ve launched and declared the satellite operational, we have 20 megahertz of spectrum we can implement at (the launch of commercial service). We’re not dependent on wireless carriers to deliver (our service) because of the spectrum asset.”

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