Mobile TV outlook bright, but...

REPORT FROM BUSINESSWORLD MOBILE TV USE in Asia is expected to reach 76.3 million out of an estimated 156 million worldwide by 2012, but this service’s success in each market hinges on 10 key success factors, a study commissioned by the Cable & Satellite Broadcasting Association of Asia (CASBAA) said. "Although mobile TV services could be a huge revenue source for broadcasters and advertising agencies, there are many issues that still need to be addressed before getting the industry on to the right track," the statement quoted CASBAA Mobile TV Consultant Mike Walsh as saying. The study, titled: "Mobile TV in Asia" which was launched in Hong Kong yesterday, cited analysis by Datamonitor that projects Asia’s mobile TV users to grow five-fold to 76.3 million in the next four years from the current estimated 15 million. Expensive handsets and uncertainties over regulatory guidelines were identified as issues faced by mobile TV service providers in the Philippines. — Evan Carla V. Alambra "On the one hand, a significant number of countries across Asia are on the brink of deploying commercial mobile broadcasting services," an executive summary of the report read. "On the other [hand], the advertising and subscription models necessary to make those services a profitable reality are still far from developed." Noting that other analysts project varying estimates of global mobile TV use in the next five years — with Juniper projecting 120 million and Gartner estimating 488 million — the report said that "the problem is, while those numbers may tell you ‘how big,’ what they don’t tell you is ‘how do we get there?’" "Until very recently, most of the debate around mobile TV has focused on technology and standards," the report continued. "However, having the right platform in place is only part of the equation." Hence, the study drew up a list of 10 factors needed for success, namely: * networks that allow mass use of streaming content without compromising quality; * ease of use, particularly in terms of navigation and organization of content; * an ecosystem that effectively and efficiently integrates content providers, network operators and device manufacturers to such an extent that it results in a viable commercial model and seamless service provision; * well-designed, affordable devices that suit either specific use (watching TV) or multi use (with communications) — The study noted that 3G was slow to take off in the Philippines, largely due to device pricing. "You can launch a mobile TV subscription service for only $10 a month, but if the only device that can support your service is a handheld that sells for about $500, you may slow your adoption rate," the report read. * coverage that is backed not just by a powerful broadcast transmitter, but also a plan for consumption in specific environments like office buildings and subways; * adequate revenue as a result of pricing policies and strategies, including billing and transaction methods and procedures that are transparent and tailored to local market conditions, i.e., majority of users in countries like the Philippines and Malaysia are prepaid; * regulations on new spectrum required for this service, as well as on content and broadcast licensing; * content that can be delivered across varied mobile platforms of Asia’s markets; * advertising that hinges on the mobile TV audience size, effectiveness of mobile ad serving and targeting technology, as well as sophistication of the local ad market; and * lifestyle factors, i.e., populations that commute largely by subway, viewer habits, etc., that would dictate on how the service would be best provided. Jose E. Locsin, principal consultant for XMG, Inc., said that, in the Philippines, mobile TV’s success is dictated by price and the delivery of the service. "It [local market] is not ready for it yet. It [mobile TV] is more of a marketing toolat the moment," he said, adding that mobile TV now has limited market. "How will you target the lower-end of the market with this service?" He said prices of mobile TV-capable handsets should be lowered around P3,000-mark, compared to at least P30,000 currently, to attract the C and D sectors. Philippine Cable Television Association, Inc. (PCTA) Director Manuel Z. Dabao echoed Mr. Locsin forecasts saying: "The market may not be ready. It is a niche market, but it won’t be enough to sustain the operations of the service." "Kung may pera para dyan ang mga subscribers nila, wala na dapat silang mga retail load [If their subscribers have money for mobile TV service, they wouldn’t have retail reload offerings]." NTC Broadcast Head Ariel Padilla explained said the price of handsets capable of the service will be critical in any mobile TV offering. "It’s expensive right now. It will not be widely adopted unless it will be cheaper," Mr. Padilla said in Filipino. Still, Smart Communications, Inc. Spokesman Ramon I. Isberto is optimistic that the service his company now offers to subscribers will be of "compelling interest." "We are a TV-oriented market. The hours of viewing spent [here] is among the highest in the world. Consider this plus the high penetration rate of mobile devices," Mr. Isberto said in a phone interview. "As the service gains volume and scales up, the [price of] device and service would go down." — Marian Grace S. Ramos/BusinessWorld