Telecommunications, Automotive and Market Research

More than 15 years in the mobile telecommunications industry and an industry analyst since 1998.

Friday, November 19, 2010

"Inevitable:" New way to describe Mobile DTV in the US. 40% of population to have MDTV before 2012

I've been party to discussions on several public forums and in person regarding mobile digital TV (MDTV).  Many of them seem to pit people from the cellular world against the broadcast world.  The arguments from the cellular side, if I could be so bold to summarize are: "you will fail if you don't make the end user pay for every bit that goes through your network." 

The broadcast-based proponents are saying, "the free-to-air/advertiser supported business model has been pretty successful for nearly a century. MDTV is just a little more of the same."

Who knows? The cellular guys could be absolutely right. But that doesn't seem to actually make a difference to the broadcasters, who seem to be pressing on, regardless.  The latest news is from the Mobile Content Venture (MCV) is a commitment to turn on 40 MDTV stations in 20 markets by the end of 2011. The announcement promised:
"...a commitment to upgrade TV stations in 20 DMAs in order to deliver live video to portable devices.  By late 2011, the venture will deliver mobile video service in markets representing more than 40% of the US population.  The service will initially consist of at least two ad-supported free-to-consumer [emphasis added] channels in each market. Additional channels and markets are expected to be added over time.
In 2011, MCV expects to offer the mobile video service in the following markets: New York, Los Angeles, Chicago, Philadelphia, San Francisco, Dallas, Washington D.C., Atlanta, Houston, Detroit, Tampa, Phoenix, Minneapolis, Orlando, Portland, Cincinnati, Greenville, West Palm Beach, Birmingham, and Knoxville.

MCV looks like some heavy hitters to me.  It's a joint venture of  12 major broadcasters and network owned-and-operated (O&O) stations that includes Fox, ION Television, NBC and Pearl Mobile DTV, LLC. The Pearl member companies include: Belo Corp., Cox Media Group, E.W. Scripps Co., Gannett Broadcasting, Hearst Television Inc., Media General Inc., Meredith Corp., Post-Newsweek Stations Inc. and Raycom Media.

In an article in, author Harry A. Jessel quotes Salil Dalvi, co-general manager of MCV:
"A free service would speed consumer acceptance and encourage the manufacture of devices able to receive the service, Dalvi said. “We recognize that this is a product that is going to have zero subscribers, zero users on day one.
“One of the key elements of the ecosystem is to get going with devices,” said Dalvi. “The best catalyst for doing that was to make content available at no direct cost to the consumer other than the device itself… so that [they] have that opportunity…to sample the product and get accustomed to consuming the content on the platform.”
What does this mean? Exactly what I've been saying here: Consumers are ready for the ad-supported free-to-air business model and broadcasters (and advertisers and program producers) all understand how it works. All the same people who've been working together for years continue working together in exactly the same way they're accustomed to.

Just as important as consumers getting a taste of the service is the clear signal to semiconductor and consumer products vendors to start making a variety of equipment. And with players like FOX and NBC, those vendors will start noticing.

No comments:

Post a Comment