Advances in broadcast and telecommunications technology have led global telecoms players and broadcasters to proclaim 2008 the year of mobile TV.
Yet reservations remain over the long-term commercial viability of the technology. Digital Broadcast examines the key issues raised at the recent Mobile TV World Summit in London.
Mobile TV has long been hailed as the next big thing by the telecommunications industry with the sector's major players eagerly scrambling to gain a piece of the action.
Speaking at the Mobile TV World Summit, representatives of Swedish network infrastructure vendor Ericsson argued that the drive for mobile broadband uptake by telcos had inhibited a significant push for mobile TV services.
"Until now, the commercial potential of mobile broadband services has preoccupied mobile telecoms operators," claimed Miguel Blockstand, senior product manager, mobile TV, end-to-end network solutions at Ericsson.
Blockstand suggested that by including mobile TV services as part of a flat rate data pricing plan - a strategy that is growing in popularity in North America and Europe - telcos could lure new mobile TV subscribers.
Despite this, the commercial reality remains stark for many mobile multimedia service providers.
Dan Whiley, commercial vice president of digital media at MTV International, confirmed that while a potential one billion people across the globe had access to the company's mobile content streams through first-party deals with telcos, he conceded that these deals were not currently turning a profit for the broadcaster.
"We have great content that people want, but how do we turn that into cash?" he mused. He also appealed for telco executives to develop new content delivery and pricing strategies, adding that only five percent of 3G subscribers in Europe regularly use mobile TV services.
Whiley told attendees that MTV generated more cash in four months from iTunes downloads in the UK than it did from all of the video-on-demand deals it maintained during the same period with mobile operators across Europe.
He added that 30 percent of MTV's digital content revenues are currently derived from ringtones and games downloaded to handsets.
Whiley claimed that the greatest inhibitor to the uptake of mobile TV services related to mobile operators' complex content service prices and complicated service offerings. For Whiley the solution is simple - operators need to be clear with consumers about how much they will charge for access to mobile TV content.
Research by UK broadcaster Channel 4 revealed that 24 percent of its mobile content service subscribers had cancelled their subscriptions due to 'bill shock'. The research also indicated that ad-funded, or ad-supported, content was four-times more likely to be accessed by subscribers.
Jake Redford, head of TV and video-on-demand at pan-European telco Orange, agreed that using advertising revenues to reduce subscription rates is key to driving subscriber numbers.
Melissa Goodwin, UK mobile controller for British broadcaster ITV, argued that mobile TV service rates should mirror fixed-internet service rates, but the content itself should be customised for wireless platforms.
"If content is free online then we cannot start charging for it on mobile," she says.
MTV's Whiley agreed with this sentiment, adding that to prove successful, mobile content providers must personalise their offerings.
A number of industry sources approached by Digital Broadcast claimed that telcos were missing out on a golden commercial opportunity by not sharing information on subscriber trends with content aggregators who can deliver targeted advertising to mobile TV users.
However, it was the question of how content should be packaged and offered to subscribers that threw up some of the more interesting suggestions at the summit.
Jakub Brzeczkowski, TV and video-on-demand director for Orange in Eastern Europe and MEA, outlined the company's 'content everywhere' strategy, which envisages a telco distributing content to a variety of delivery platforms including mobile TV and IPTV networks, leveraging a number of different pricing models.
Whiley believes mobile TV is struggling to realise its true commercial potential because previous marketing strategies were ultimately flawed. "That's what happens when you give a bunch of geeks a mobile TV and tell them to 'go and have some fun'," he told delegates.
For Whiley, the commercial success of Hutchison's 3 Italia has raised the bar for making content accessible on mobile handsets. Representatives from 3 Italia claimed that since its DVB-H mobile TV service launched in 2006, its ARPU (average revenue per user) has risen by 60 percent.
A third of the extra revenue comes from the DVB-H service, according to Marco Maestri, the company's TV solutions director.
Maestri attributed the service's success to the fact that it broadcasts the Italian Serie A football league.
He also cited research from M:Metrics which noted a major spike in subscriber uptake of DVB-H services in Italy during the country's victorious 2006 FIFA World Cup campaign.
This trend is of particular interest to operators in the Middle East where 3G networks are widely deployed.
These devices, also equipped with other smartphone capabilities, could arguably garner larger revenue streams for operators given their compatibility to other network services such as push email and video-calling.
In Europe, there were a number of DVB-H launches in 2006 to coincide with the FIFA World Cup in Germany.
The European mobile TV market is expected to register moderate growth till 2009, after which it is expected to rise steeply, led by DVB-H, according to figures released by Informa Media and Telecoms.
Similar developments are also expected in the North American market, although if DVB-H trials there prove successful, this timescale could be accelerated. It is also assumed that DVB-H will be favoured by WCDMA operators and MediaFLO in EV-DO, although obviously there will be a degree of overlap across technologies.
China plans to establish mobile TV services prior to the start of the Olympic Games later this year, with the country's authorities keen to promote the event as the 'digital Olympics'.
The Chinese market has not yet chosen its preferred path for mobile digital broadcasting, indeed virtually all technologies are being trialled, and it may yet even develop its own proprietary technology.
Market research firm Informa Telecoms & Media recently predicted that the markets of Latin America and India will adopt DVB-H before 2011. The emerging markets of Asia Pacific and the Middle East and Africa are also expected to formally adopt DVB-H sometime in the near future. Although analysts at Informa Telecoms & Media also note that it is likely that the footprint of a satellite-based system may be launched to cover some of the areas in both of these regions.
These findings add weight to previous reports in Digital Broadcast, which predicted that the UAE Telecommunications Regulation Authority would opt for the DVB-H standard when issuing a mobile TV licence in the second half of 2008. However, the DVB-H standard is not without its detractors.
Bernd Reul, strategy consultant, business development at Danish mobile operator TDC Mobil, argued that the costs associated with deploying a DVB-H network had stifled his company's attempt to launch a broadcast mobile TV service based on the standard.
"People use their mobile phones for loads of things but not for broadcast, or live, mobile TV services," he declared at the summit. Reul argued that revenues generated by an entirely separate broadcast mobile TV network, as the DVB-H standard requires, does not justify the cost of investment.
He also claimed that in its current guise, mobile TV cannot compete commercially with mobile internet services, especially as popular online video sites such as YouTube continue to expand their web service offerings.
"At any given time of the day there are only a few mobile TV channels being viewed by our subscribers in significant numbers," says Reul. "This is simply not sustainable in a small market like Denmark."
Instead, TDC Mobil has opted for a MBMS broadcast TV solution, similar to that currently being trialled by UK operators Orange and T-Mobile, using spectrum available via its 3G network.
"There is too much risk and capital involved with the alternative [DVB-H]," Reul claimed.
Orange's Redford claimed that mobile TV services ranked a lowly 15th place in what influences subscriber behaviour when selecting a network.
"Our research shows that mobile content is only a minor factor that influences their decision to go with a particular network," he noted, adding that voice and SMS tarriffs and bundle offers were declared more important issues.
Redford also conceded that mobile TV - as things stand - will never gain enough momentum to prove a mass market proposition.
"It [mobile TV] is not going to necessarily drive people to a cellular network," he said, although he did not rule out the possibility of this changing in the future, if new strategies were considered.
It would appear that the long-term success of mobile TV services also depends on the availability of terminals for viewers to access the content.
Informa released figures at the event which predicted that by 2011, DVB-H handsets will make up 61 percent of all annual broadcast receiver handset sales, equating to 73 million units, with sales of MediaFLO devices expected to reach 14.6 million (12 percent of total shipments during the same period).
The company predicts that by 2011, video-capable phones, such as 3G handsets and those with the required media-player software, will outsell converged broadcast handsets five to one.
Ultimately, the purported commercial benefits associated with deploying a broadcast mobile TV service remain less than assured, with operators in Europe and North America continuing to struggle to generate profits from their mobile TV services.
Even operators based in the booming markets of the Asia-Pacific, where mobile TV has seen significant subscriber uptake, have struggled to develop the 'killer application' that will offset dwindling voice and SMS ARPUs.