Mobile TV state of industry

ORLANDO, Fla.-Mobile television is still in its infancy-mostly gaining traction among early adopters and primarily young men-but the subscriber base has more than doubled from 3 million to about 7 million users in the past year, Kanishka Agarwal, vice president of mobile media at Telephia, said in opening remarks at a panel focusing on the outlook for mobile TV in 2007.
The star-studded panel of TV network executives and mobile TV enablers packed a large room to standing-room only capacity. Yet not one of them claimed early victory.
Sizzle reel after sizzle reel hit the big screen as each of the executives waxed poetic about the new medium’s future. Meanwhile, in almost the same breath, they admitted shortcomings in what they’re calling the early days of the service.
“We are very firm believers in the experience on the cellphone and we believe that where we’re currently at is really the very, very early days,” CBS Mobile Executive Vice President Cyriac Roeding said. “If we don’t start today, we’re never going to get there quickly.”
He described CBS’ initiative in mobile as nothing short of developing a completely new network that demands 18 hours a day of entertaining programming-quite different from the traditional fervor aimed at the two-hour, prime-time slot. “I believe very much in this next step in mobile television,” he said. “This is really about a different user experience. This is less of a device than a user situation.”
Much of Roeding’s excitement is focused on the years ahead. He admits the current makeup of mobile television doesn’t yet deliver the interactive user experience that he believes will push the service into more open arms, but he sees this as a logical step toward that direction and is anxious about the potential.
He said CBS is doubly interested in MediaFLO USA Inc.’s network because as a broadcast service it mirrors the advertising opportunities available to CBS on more traditional platforms.
“We have basically opened the gates to mobile advertising in a very big way with this service,” he said. “We’re starting to put advertising into video clips as well and starting to experiment with it,” but “at the end of the day, it’s about the consumer experience so we have to make sure the consumer has an advantage if there’s advertising connected to it.”
ABC Entertainment executive Bruce Gersh said it too is creating multiple channels on which to deliver its content. “We used to either have a film studio or a TV studio,” he said. ABC, however, is one of the few glaring absences on the current MediaFLO roster, though its ESPN brand is on the docket.
“Unfortunately with respect to MediaFLO, we just couldn’t come to business terms,” he said, marking the first official comment on the matter. Later, during a question-and-answer session, Gersh was pressed to further explain what broke down in the talks, and MediaFLO President Gina Lombardi joked, “You brought that on yourself, dude.”
Both companies are still talking, they said. “We plan to add additional content providers,” Lombardi said.
“Our goal is all about reach,” Gersh said, adding that if they can reach a fan at home, online and on mobile it would be a homerun for the major network. “We’re not looking at mobile as just a North American opportunity, we’re looking at is as a global opportunity,” he said.
Tammy Franklin of Turner Broadcasting, another notable absentee on the MediaFLO service, said the network has participated in all the major trials and is continuing to learn and refine its mobile strategy. The company recently partnered with L.M. Ericsson to develop and deliver its suite of news and entertainment content to the handheld.
“You know the service is really just launching. We really don’t know what people want to watch,” she said.
“I think the exciting thing is to see how these commercial services are accepted in the marketplace,” said Salil Dalvi, general manager of wireless platforms at NBC Universal. “The full-length programming component is up and running.”
Paul Scanlan, COO and co-founder at MobiTV, said being one of the pioneers in mobile television has given the company exceptional foresight into the road ahead. “Don’t underestimate the progress that we have made and continue to make,” he said, adding that MobiTV has looked into broadcast options, but is hedging its bets elsewhere. “To be honest, we’re making our bet on WiMAX,” he said.
Scanlan argues that the quality of MobiTV, which runs over carriers’ 3G networks, is of the same quality as MediaFLO and that “they haven’t even put a dent in those networks in terms of capacity.” MediaFLO runs on a separate network committed entirely to broadcast mobile television.
Scott Wills, president and COO of Aloha Partners L.P.’s HiWire, stood out among the panelists as the only member without a “sizzle reel” and went with a PowerPoint presentation that offered statistics he claimed proved that DVB-H and HiWire were uniquely positioned to the lead the pack in terms of monetization, the wealth of content and costs on all fronts. He dove straight into the core business model of mobile television.
“A six-minute high resolution video clip loses money” on a unicast system, and carriers stand to make merely pennies on low-resolution video clips while they continue to enjoy handsome profits from SMS and other data services, he said.
Following the end of his slideshow, MobiTV’s Scanlan jumped in to call his slide on monetization “one of the most misleading slides I’ve ever seen in a panel like this.”
Wills said HiWire will be launching its initial market in Las Vegas next quarter and that a LG Electronics Co. Ltd. cellphone will be working on the T-Mobile USA network in a new trial. Lombardi honed in on the fact that MediaFLO’s service is already in full swing, having landed multiyear deals with Verizon Wireless and AT&T Inc., and it plans to launch in more markets and add additional content providers soon.