Member of
Mobile Television: An Overview
Patrick Pfeffer
September 26, 2007
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Content
1. Market Potential
2. Regulatory Issues
3. Technology Options
4. Current Deployments
5. Conclusions
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Mobile TV trend-scoutingMarket Potential
The RGU market for mobile TV is much larger than for fixed IPTV due to the large number of video capable mobile devices.
Mobile TV Subscribers by Region©TelecomView 2007
0
70
140
210
2005 2006 2007 2008 2009 2010 2011
Millio
ns
ROW
Western Europe
North America
Asia-Pacific
Global TelcoTV Subscribers©TelecomView 2007
0
25
50
75
2006 2007 2008 2009 2010 2011
Millio
ns
Asia Europe North America ROW
448406
361309
249
1,107
808
528
306
157
2006 2007 2008 2009 2010
3G Subscriptions (in M)
DSL & CableSubscriptions (in M)
Number of DSL/cable line
Number of 3G or video ready phones during the next
+16%
+63%
Bob’s
Estim
ates
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Mobile TV value innovationMarket Potential
Like for IPTV, customers are not asking for mobile TV. Operators must demonstrate value/price ratio to market.
Value Proposition through innovation
Content
Download Streaming
On-demand Carousel Non-live Live
Pay TV program Video on-demand Push and store Clips
Subscription Free TV program
Enterprise
Mass market
Value Creation through content segmentation
Core Requirements
The service must be available outdoor, indoor and in moving vehicle
Public channels and pay channels are a must, special channels desirable
Radio must be available
Wide coverage (urban, suburban and main roads)
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The gray zoneRegulatory Issues
Pressure points
All regulatory bodies are playing catch up with technology and early entrants are fighting awkwardness of obsolete regulations. There are regional differences.
Spectrum
Allocation and acquisition of scarce frequencies difficult in specific markets
Different regulatory bodies in geographical markets (even within same country e.g. Germany)
Some countries demand proprietary standards for broadcasting (e.g. China).
Content
Regulatory issues concerning unicast content (e.g. VoD) vs. broadcast transmissions
Public vs. commercial broadcasting
Digital Rights Management issues regarding distribution, protection and royalties for copyrights
Protection of consumers
Commercial
Free to air networks might prohibit charging for service (e.g. South Korea)
Coverage requirements might forbid profitable network rollout
Non discriminatory conditions between different distribution platforms
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Broadcasting technologies landscape – DVB-H standard gains momentumTechnology Options
Broadcasting technologies – key facts
DVB-H
Digital Video Broadcasting
Handhelds
T-DMB
TerrestrialDigital Multimedia
Broadcasting
S-DMB
Satellite Digital Multimedia Broadcast
MBMS
Multimedia Broadcast Multicast Service
MediaFlo
Media Forward Link Only
Region Europe, USA, Australia South Korea South Korea, Japan Europe, South Asia USA
Download Rate Up to 11 Mbps Up to 1 Mbps Up to 2.3 Mbps Up to 0.38 Mbps Up to 11.2 Mbps
Video Codec MPEG-4 MPEG-4 MPEG-4 MPEG-4 MPEG-4
Channels/128kbps 60 3-5 9-27 3 50-70
Cell Size 17-40km 40-60km 3-700km 2-3 km 2-10km
Power Reduction Time slicing Bandwidth shrinking Bandwidth Shrinking Time slicingTime division multiplexing
Transport stream MPEG TS, IP MPEG TS IP IP MPEG, IP
Frequency VHF, UHF, L-BandVHF band III
1,452 to 1,492 MHz2.6Ghz 174 to 230 MHz,
470 to 862 MHz716 to 722 MHz, 698 to 746 MHz
CAPEX
Out of the large range of cellular, terrestrial and satellite broadcasting technologies, some of them are emerging as standards in different regions.
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Mobile TV devicesTechnology Options
Outstanding issues
The challenge here is to find the balance between device cost, performance, form-factor and style depending on the target customer segment.
Battery Technology and power management are two crucial aspects to determine the success of Mobile TV.
Integration of new DVB-H, DAB or DMB tuners and channel decoders represents a significant challenge both in terms of energy consumption and components costs.
Application processors, RAM memory, GPS chipsets, large and high resolution colour displays are vital for high quality of service and end-user acceptance.
Ease of use and large choice of different mobile TV ready handsets are essential for the momentum market take-up
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Status quo in early adopters marketsCurrent Deployments
In a nutshell
Mobile TV market dynamics are heavily influenced by geographical characteristics and respective regulatory frameworks.
Market split between Video on demand subscribers and Mobile TV services
MobiTV content aggregator approach is a success story
Mobile TV over WiMAX is talked about for 2008
USA
Regulatory muddle due to federal system
Digital Right Management issues (GEMA)
European Commission initiative promoting DVB-H
Germany
Pitfalls of MBCo: no alliance with mobile operator, purpose built devices, distribution strategy
ISDB-T standard used for One
Seg Service, no charging allowed by regulator
Japan
DVB-H is predominant, take-up push by FIFA World Cup 2006
High pricing with early adopters
Wholesale approach by Mediaset to serve mobile carrier
Italy
Source: DETECON Research and Analysis
Struggle between paid service and free of charge scenario
Pricing and handset affordability is a concern for user acceptance
Wholesale approach with 25% revenue share for mobile carrier
South Korea
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H3G acquired Channel 7 thus owning its own DVB-H license. H3G has been the first MNO offering Mobile TV and interactive services
TIM and VOD signed wholesale agreements with Mediaset. Mediasets’ channels can be viewed by both TIM and VOD UMTS/DVB-H subscribers
Two players: H3G (vertically integrated) and Mediaset (wholeseale) Mobile TV offering to pre- and post-paid customers 20 channels available Pricing options: daily (3€), weekly (10€) or monthly (10€) basis Both Mobile TV platforms enable basic interactive services:
Channel subscription, ring tone download, and voting
Interactive platform is a proprietary solution, lack of standards DVB-H/UMTS integration enables a seamless interactive services Technology enables service subscription on handset Both DVB-H MUX cover 75% of country (outdoor)
Technology Market Success
High penetration of 3G (EY 06): 21M H3G Mobile TV subscriber (including sporadic
users (Mid 07): 500K TIM/VOD subscribers together (Mid 07): 100K
Player
Product Description
logo
Interactive Services
Intense marketing campaigns MNOs want to merge IM-TV with existing UMTS
based video services and further develop basic interactive services (e.g. betting, shopping, etc.)
Strategy
H3G Mobile TV w. channel subscription service
Voting at Mediaset
Current DeploymentsItaly
With 600K Mobile TV subscribers Italy is the most developed European market. There are two mobile broadcast networks. Interactive services are in infancy.
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MFD signed content partnerships with ARD, ZDF, MTV and Pro7Sat.1
Partnership with Mobile Service Provider: Debitel, Victor Vox, others. Together they amount 25% of all mobile subscribers in Germany
No partnering with MNOs (TMO, VOD, O2, EPL)
In 06 Mobiles Fernsehen Deutschland (MFD) has launched the first broadcast based Mobile TV service
Channels: ARD, ZDF, MTV, N24, a Pro7Sat.1 and a visual radio station
Limited interactivity: ESG, sent-in MMS as visual radio message, ring tone and music download (both BigFM), WAP based services (IFA show case)
Trial: Mobile soaps with SMS as reminder and content-elements
MFD uses DMB, broadcast technology based on DAB Technology enables WAP based backchannel integration MFD holds a nation wide L-Band license Coverage only in large metropolitan areas; 16 Mio. potential users
Technology Market Success
Watcha Subscriber (Estimate): 7,800 (YE06) Monthly flat rate differs between 5 € and 10 € Revenue sources: Service subscription,
advertisement and user interaction
Player
Product Description Interactive Services
MFD is positioning itself as a technology independent Mobile TV platform operator
In competition to a consortium of TMO, VOD E-Plus and O2, MFD also pursues a DVB-H Mobile TV license
Strategy
Watcha Mobile TV offering
Sent-in MMS as visual radio message
Current DeploymentsGermany
Watcha is the first broadcast based Mobile TV offering in the German market. It features only limited interactivity.
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TU Media (broadcast service company, SK Telecom owns 30%) operates the country’s S-DMB network
TU Media aggregates content and simulcast cable content 25% to content owners and 25% to MNOs
Pay-TV only (thus threatened by free T-DMB based Mobile TV) Large variety of channels: Music, news, lifestyle, economy, traffic,
local YTN, 1to1, U1 Media (channels), Content: 75 % video, 25 % audio One-time connection fee ($20) and usage-dependent content fee
(ARPU $20).
Geostationary satellite-based DMB, amplified via about 6000 repeaters in inaccessible areas
Operate in 2.6GHz Repeaters work with Ku-Band at 12GHz
Technology Market Success
Launch in May 2006, 1 Mio customers in Nov 06, Forecast: 6,6 Mio user in 2012
Still fast growing, but less than T-DMB, Total Revenue DMB 2007 forecast): € 240 Mio
High-priced handsets, questionable user exp.
Player
Product Description Interactive Services
KT telecom service using WiBro and DMB – users will be able to retrieve information through WiBro in the background and display it on the screen (e.g. with Samsung M8000 + extra receiver )
Usage of Mobile TV popular in metropolitan areas for commuters, but limited to cell phones (larger variety at T-DMB possible)
Average viewing time/day 62min (average world: 15-20 min, average Europe: 2-3 min)
Strategy
Current DeploymentsSouth Korea
Satellite-based DMB is threatened by free accessible T-DMB. Combination with WiBRO for interactive services.
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Korea Telekom holds DMB license, runs network and defines channel portfolio (e.g. KBS, MBC, SBD, etc)
MNOs take advantage of free DMB service and sell handsets Content providers (e.g. KBS, MBC) broadcast their channels free
Service is free (Regulator) Revenue to be gained via customer retention in other offerings Service usage: automotive devices (50 %), USB-Devices (30 %),
mobile phones (20 %) Seven DMB-TV channels, 13 DMB-Radio channels, eight data
services (JPEG Slide Show, Dynamic Labeling, Wireless Service, Traffic Service)
Domestic technology based on the DMB standard used by DTT and satellite broadcasting throughout Europe and Asia
Runs at 12MHz (10 times more capacity than Germany’s MFD)
Technology Market Success
Launched in 2006, already 0,6 Mio users after four months
Forecast: 4 Mio users EY 06, 13,9 Mio in 2012 Total Revenue DMB (2007 forecast): € 240 Mio
Player
Product Description Interactive Services
Usage most popular while commuting or at work/school
Fast growth, but not profitable yet Many type of devices available
Strategy
Traffic information
service on a PDATraffic information service via DMB
Current DeploymentsSouth Korea
Fast growing terrestrial DMB Mobile TV with free access shows high growth rates. Some interactive services.
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Qualcomm owns the spectrum, runs the MediaFLO broadcast network and provides the service on a white-label basis
Verizon purchased the MediaFLO service and integrates it into its overarching “V Cast” mobile entertainment platform
V Cast is a 3G network created by Verizon, used for broadcasting Mobile TV channels, video clips and music (e.g. CBS Mobile, Comedy Central, Fox Mobile, MTV, NBC, NBC News, Nickelodeon, etc.)
Video content: Music, Showcase, Comedy, News, Weather, Entertainment, Sports, Net’s Best (e.g. You tube)
Features: Channel surf with no buffering, intuitive program guide, text reminders for favorite shows, call taking without interrupting program
Verizon’s V Cast service integrates unicast and broadcast technology
Verizon Wireless’ Third Generation Wide Area 1XEvDo network Data transmission at speeds of 400-700 Kbps and bursts of up to
2.0 megabits per second
Technology Market Success
Commercial launch: March 2007 V Cast service costs $15/month (basic package)
or $25/month (select package) with unlimited basic video clips, access to mobile Web 2.0, unlimited airtime and email); limited package $13
Player
Product Description Interactive Services
Pull strategy: Offering of popular channels attracts customers to services
MediaFLO signed a Mobile TV wholesale agreement with Cingular
Available in 35 states
Strategy
Entertainment and weather on VCast
Current DeploymentsUSA
Verizon markets Qualcomm’s MediaFLO broadcast Mobile TV service. It enables very limited interactivity.
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MobiTV owns the service, defines portfolio and delivers the app MNOs (Sprint, Cingular, Midwest Wireless, nTelos, US Cellular,
Cellular South) have signed wholesale agreements with MobiTV
Service offers both live streaming and on-demand video clips Mobile TV available in English and in an English/Spanish version Service offers more than 10 popular channels (e.g. MSNBC, ABC,
CNN) Several interactive features: Interactive advertising, Interactive M-
Commerce (e.g. purchase ring-tone or ticket), Interactive Content Rating, Voting, Sharing & Community
MobiTV supports multiple 3G network technology and hardware systems
Compatibility includes several cell phones (Nokia, Motorola, Samsung Sony Ericsson etc.) and smart phones
Technology Market Success
More than 1 Mio subscribers Fees vary depending on vendor
Player
Product Description Interactive Services
Pull strategy: Offering of popular channels attracts customers to services
MobiTV is likely to sign agreements with further MNOs
Strategy
Sports and news on MobiTV
Current DeploymentsUSA
MobiTV is a 3G Mobile TV service predominantly available through Sprint and AT&T. Many interactive features available.
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Conclusions
Many technologies
Handset drag down
Various business models
Cannibalization of IPTV ?
Customer demand fallacy
Content might not be too complicated
Mobile TV + 2/3G services
Part of the bundle
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Contact
Integrated management and technology consulting worldwide
Patrick Pfeffer
Detecon Inc.400 S. El Camino Real, Suite 500San Mateo, CA 94402Phone +1 650 401 5222Fax +1 650 401 5298Mobile +1 707 971 [email protected]