Cingular Wireless L.L.C. joined the mobile TV bandwagon last week, launching a carrier-branded streaming video service featuring short clips from 18 channels.
But whether consumers really want to watch TV on their phones-and how much they’ll pay for it-remains anybody’s guess.
Content providers for Cingular Video include ESPN, NBC, the Cartoon Network, Disney Mobile Studios and CNN. The programming is included with the carrier’s 3G data plan, which costs $20 a month and is currently available in 16 cities.
Video shorts from HBO hits including “The Sopranos” and “Curb Your Enthusiasm” will be available for an extra $5 a month. Cingular introduced two new phones to support the service, and expects to add new handsets in coming months.
The move marks a major step for Cingular, which finally joins Sprint Nextel Corp. and Verizon Wireless in offering branded video services. Cingular and Sprint Nextel also carry MobiTV.
Wireless is placing huge bets on wireless video, with Qualcomm Inc. and Modeo Inc. each spending hundreds of millions of dollars to build out new networks to support multimedia broadcasts to mobile phones. Industry insiders may be far more excited about mobile TV than consumers, however.
A study of 100 “mobility experts” released earlier this month by RBC Financial Group found that 63 percent of respondents believe users want to watch TV or movies on their mobile phones. The figure contrasts sharply with a report RBC issued a day earlier, though, that found three-quarters of consumers agreed with the statement, “I am not interested in watching TV programs on my handheld device.”
Interestingly, the RBC surveys didn’t mention price points. Instead of responding to questions about how much they’d pay for mobile video, an overwhelming number of consumers said they simply weren’t drawn to the application.
“This discrepancy is likely due to the fact that we are in the early stages of an evolution in mobility,” Scott Collins, director of U.S. equity research at RBC, said hopefully. “With single-purpose products disappearing as functionality converges, consumers are resisting making a choice. But our research shows that, in time, mobility will be adopted widely.”
Others take issue with many of the studies and pilot projects, suggesting that demand for the substantial breadth of available and potential content can’t be determined with a few simple questions. A Diffusion Group study noted: “To summarize, evaluating the appeal of novel services such as watching video on a handheld device is much more complicated than asking a simple true/false question. Too often evangelists and naysayers grab on to simplistic research in order to prematurely extol or condemn emerging services such as mobile video.”
There is evidence, of course, of strong demand for mobile TV in the United States and around the world. MobiTV, one of the first services to be offered to U.S. consumers, surpassed the 500,000 subscriber mark last September-far more quickly than many analysts anticipated.
And Nokia Corp. last week hailed results from pilot efforts in Finland, France, Spain and the United Kingdom that it claims vindicate efforts to bring video to handsets. The handset-maker is involved in several wireless video efforts in Europe and the United States using Digital Video Broadcasting for Handhelds (DVB-H) technology.
Nokia said 76 percent of participants in a U.K. trial said they would subscribe to the service in the next year. Sixty-eight percent of French users said they would pay for mobile TV, and 55 percent of consumers in Spain said they were willing to pay for the service.
Critics point out that the Nokia pilots used Nokia 7710 smart phones, which are substantially more sophisticated-and expensive-than the mass-market phones most subscribers use.
Of course, many other issues must be addressed before wireless TV moves from pilot projects and early adopters into the mainstream. Cingular’s HBO offering has been described as dated, highlighting some of the licensing issues carriers and content providers face in acquiring popular TV content.
Perhaps most importantly, operators are faced with the delicate task of finding price points that attract users even as they generate much-needed revenues. And they must monitor usage as well, making sure their networks don’t get bogged down with data-heavy video services.
So while mobile video continues to capture the imagination of the mainstream media and tech-savvy gadget freaks, any real traction is likely years away, according to Jupiter Research analyst Thomas Husson.
“Just be patient,” Husson wrote last month. “Consumer demand (for mobile TV) is there, but it is not as significant as claimed in trials and in the press. Mass-market is far from being a reality.”
