Mobile TV: (Don't) Believe the Hype (?)
By Brian L. Clark
This week I received an invitation from Parks Associates to attend the Mobile Video Summit 2006. Since Gizmodo has informed me it's not in the budget to send yours truly to Seoul, Korea, I'll just have to comment without actually seeing what the mobile TV folks have to sell. Doesn't matter, really, I'm always happy to share my opinion about unnecessary technology.
Mobile TV is, quite honestly, another attempt by phone companies to justify their enormous investment in 3G. In fact, according to the invite for the Summit, mobile TV is about to become the "name of the game globally." This particular event offers a "great opportunity to see, feel and foresee the mobile TV solutions and visions presented, discussed and exhibited by international big players."
In any case, the invite made me think about how I should "see, feel and foresee" the whole idea of "international big players" enabling me to watch TV on my phone. Let's say it's fall and I'm stuck at another Sunday soccer game, for example. Even worse, let's say I'm forced to listen to another God-awful Jets or Giants game on my AM radio just to get the score for my beloved Eagles. (We had a better draft, by the way.) Personally, I'm much more inclined to listen to the game via a service like Sirius—assuming they ever offer a portable that plays live broadcasts—than I am to actually watch video on my phone.
Building out a mobile TV network isn't gonna be cheap, either. According to a Pyramid Research report entitled, Rescuing 3G with Mobile TV: Business Models and Monetizing 3G, the phone companies are looking at an additional infrastructure cost of about $12,000 per site. Let's say our hypothetical network requires 50,000 base stations. That's over a half-billion dollar investment.
Which leads to the big question: How much would mobile TV service cost subscribers? Well, according to Pyramid, the price people are willing to pay for video service on their phones is somewhere between $9 and $15 a month.
Alas, no one asked me.
So I ask you, is there anyone reading this who doesn't think they already pay too much for wireless service? Besides, entertainment dollars are already stretched thin. Folks who pay out the wazoo for cable and Internet access, plus a subscription to Netflix, Napster and maybe even satellite radio are not inclined to add another $15 every month to watch video on their tiny little phone screen.
So phone companies are also exploring a pay-as-you-go model, whereby users are charged $1.10 for a five-minute interval. In my experience, phone companies will see this as another opportunity to tack on "small-print" charges—the type I may or may not understand even if I actually take the time to read the fine print in the contract. As a result, that $1.10 is likely to end up being $1.50 or $2.
Verizon is also experimenting with two-tier pricing for its V CAST service, offering a lower monthly subscription for people willing to be exposed to advertising. According to the Pyramid, "indications are strong that this model will reach widespread adoption as Mobile TV evolves." That means splash screens while videos load as well as 10- to 15-second spots. Oh boy.
Finally, there's the initial cost for hardware. Early adopters should be prepared to shell out some serious scratch, according to the report—handsets compatible with a broadcast mobile TV standard are likely to run $400 to start.
Obviously, it's early in the mobile TV game. Just the same, all this makes me think the best thing that could happen is for mobile TV to be part of an IPTV bundle, provided by carriers like Verizon or AT&T two or three years down the road. But that would have to mean some type of cooperation between old line telcos and their wireless brethren. And that's about as likely to happen, as I am to watch TV on my phone.