Amsterdam, Netherlands Suppliers of mobile-TV technology, waiting for the fledgling market to take wing, have already entered a race for survival.
The number of credible mobile-TV chip vendors is down to three: DiBcom, Siano Mobile Silicon and Newport Media. Bigger semiconductor companies, such as Texas Instruments and NXP Semiconductors, are putting their mobile-TV projects on the back burner.
To stay in this embryonic market, "you must believe in mobile TV," said Mohy Abdelgany, president and CEO of Newport Media. It requires "a leap of faith" and money, he said. While a few chip vendors have fallen off the pace, Abdelgany said, "With the $85 million we've got, we can outspend larger companies."
But his company may be an anomaly.
Various mobile-TV trials and commercial rollouts have reminded the industry of the critical importance of spectrum availability and up-front network build-out planning. But they have offered scant clues about effective business models or specific mobile-TV standards.
Italy's much-celebrated mobile-TV broadcast services--rolled out in time for the soccer World Cup last year--are now considered a blip that came and went with little impact, according to many industry insiders who attended the International Broadcasting Conference (IBC) here Sept. 7–11. Although Italian consumers initially embraced DVB-H-based mobile-TV handsets, the devices' popularity has reportedly reached a plateau. To foster a new round of market growth, operators are launching an effort to bundle free- and pay-TV channels.
Qualcomm's aggressive investment in MediaFLO-based networks has helped the two largest U.S. operators--Verizon Wireless and AT&T--to solidify their mobile-TV strategies. But this has effectively smothered the competing DVB-H-based system and stifled interest in mobile TV in the United States.
Modeo, which closed shop earlier this year, was the first casualty. Many suspect that Hiwire is next. Hiwire, a subsidiary of Aloha Partners and the largest owner of 700-MHz spectrum in the United States, is promoting DVB-H. But most in the mobile-TV industry now see the company as "a spectrum speculator" rather than a serious operator.
Azzedine Boubguira, vice president of marketing and business development at DiBcom, said, "It's not MediaFLO that won. It's DVB-H that failed" in the U.S.
Verizon started marketing MediaFLO-based mobile-TV handsets earlier this year, and the service is available in 37 markets. But the carrier has never provided hard data about how many people are signing up.
Newport Media's Abdelgany is hopeful, though. "We may see new market dynamics once AT&T starts mobile-TV services," he said. His company plans to sample a single-die tuner/demodulator SoC compliant with the MediaFLO spec early next year. It is pinning its hopes on leading handset vendors such as Nokia, which does not use Qualcomm chip sets, starting to supply MediaFLO-compliant cell phones to AT&T.
Meanwhile, U.K. British Telecom this summer shut down its mobile broadcast branch, BT Movio. The Digital Audio Broadcasting-IP (DAB-IP)-based delivery platform developed by BT Movio was the only mobile broadcast TV service in the U.K. While the operator declared that the service would carry on until the beginning of next year, BT canceled the contract with GCap Media, which provided access to the DAB spectrum.
Some blamed its failure on the HTC-manufactured "Lobster phone"--the only phone made available for the service--for being unattractive and offering poor TV quality. However, others believe BT Movio got caught between a lack of spectrum availability in the U.K. (which pushed it to adopt DAB instead of DVB-H) and the European Commission's meddling. The EC had leaned hard on member states to adopt the DVB-H standard. Screen Digest in the U.K. noted that BT Movio was "stuck with a platform [DAB-IP] which cannot draw enough attention from mobile operators, handset manufacturers and, inevitably, mobile subscribers."
Only a year ago, in June 2006, In-Stat predicted, "By the end of 2010, mobile-TV broadcast subscribers worldwide will reach 102 million, a giant leap from 3.4 million in 2006." The Gartner Group went even further. Earlier this year, the market research firm predicted mobile TV "will become a mainstream service in most developed markets by 2010 with close to half a billion subscribers worldwide."