Mobile TV Deployments Update by bestt571


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									Mobile TV Deployments
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Most observers in 2008 quietly wrote off the          has a full scale war between MNOs and                        February 2009
prospects for Mobile TV. Yet despite this, it is      broadcasters over which is the correct business
only local issues with business models, and the       model to proceed on, while German operators
fact that in certain parts of the globe, Mobile       have lost all interest in DVB-H after the license
Network Operators (MNOs) have other issues at         there was given to the broadcast based Mobile
the forefront of their agendas, which hold it back.   3.0 and then returned to the regulator. Spain
                                                      has also put off allocating available 700 MHz
Inexorably broadcast Mobile TV is developing,         spectrum and there are other minor delays in
and during 2008 it forced the cumulative              central Europe including Poland.
shipment of specialist Mobile TV handsets to 59
million, where those handset had to be                In the US, MediaFLO has attracted perhaps
especially built to receive a separate video          100,000 customers, while waiting for its network
signal. There is also a resurgence of cellular        to go national, which will bring it the full backing
streaming, as systems have upgraded to the            of both the AT&T and Verizon Wireless

H.264 codec, producing better video quality as        marketing programs. MediaFLO is also planning
                                                      to add more content, but it is expensive content
bandwidth has broadened with the
                                                      which requires up front payments, and it cannot
implementation of HSDPA and EV-DO.
                                                      do this until it is ready to trigger the full backing
                                                      of the major MNOs. This is now likely to be
The impression that Mobile TV is ailing is
                                                      delayed since Barack Obama’s administration is
because the US press can see no break in sight
                                                      expected to put a 90 to 120 day moratorium on
on their home soil, while in Europe there has                                                                                 Peter White
                                                      bidders taking up their spectrum rights after the
been a catalogue of disasters. Italy has long                                                                                Lead Analyst
                                                      recent US 700 MHz auctions.                             Rethink Research Associates
been held up as the European leader, and has
been joined by a successful launch in the             However, this will set the stage for the US
                                                      ATSC M/H standard to be completed. This will
Netherlands, and less effective introductions in
                                                      allow local broadcasters to begin transmitting                         ARCchart Ltd
Austria, Switzerland and Finland (the Finnish
                                                      free to air services and to ready early handsets,                   27 Holywell Row
system has been ready for years, but had                                                                                London EC2A 4JB
                                                      giving a chance for the other parts of the
copyright legal issues). Elsewhere in Europe the                                                                                       UK
                                                      broadcasting community’s Mobile TV eco-
UK is stymied by the spectrum situation; France                                                                      Tel: +44 207 456 9669
                                                      system to bear fruit.

    Global Wireless Research                                                                      Sector Report
Mobile TV Deployments Update
Both a renewed MediaFLO and new ATSC M/H
                                                                 Japan leading the charge
systems are likely to emerge in the US during 2009 -
we expect as many as 500,000 ATSC M/H devices to                 Japan has led this charge, and will still lead the bulk of

ship inside the year. These will develop alongside               this effort, with an anticipated further 20 million devices

other US operations including the in-car seat back               shipped during 2009, taking its ISDB-T handset

services of ICO Communications (already launched),               penetration to 60 million devices. Today, around 65%

Sirius Satellite video services (launched last August            of high end handsets come with ISDB-T 1 seg tuners

but no numbers yet) and EchoStar, which plans to                 bundled (the mobile broadcast system is broadcast in

launch its own services during 2009. By year end the             one segment out of the 13 segments in a TV signal).

US might have five or six broadcast Mobile TV efforts,           Usage figures per viewer in Japan are already over 62

and even stronger cellular streaming packages than it            minutes per day and still rising.

has today.
                                                                 As such the Japanese model is one that everyone is

But across the rest of the world, initially led by the           trying to emulate. However, few companies can claim

2005 and 2006 launches in Japan and Korea,                       to have made any profit out of this system, despite its

broadcast Mobile TV has flourished, and from a base              eco-system – including advertising, and interactive m-

of 40 million handsets a year ago, it has reached 59             commerce being substantially ahead of the rest of the

million and rising (See table). During the course of             world.

2009, accumulated shipments for specialist broadcast
                                                                 Broadcaster NHK is behind much of the original effort
digital Mobile TV handsets should reach almost 90
                                                                 in Japan, and now all other broadcasters, as well as all
million devices as more countries turn on their various
                                                                 the MNOs, support 1 seg. The system there runs
different broadcast technologies and begin recruiting
                                                                 alongside a high penetration level of existing streamed
customers. Around 30 million specialist devices should
                                                                 video over cellular, with both now using H.264 codecs,
ship during 2009 alone.
                                                                 having started on less efficient compression.

Broadcast mobile TV services already launched

             Country      Launched      MoTV Handsets        MoTV Handsets       MoTV Handsets        Technology
                                         End of 2007          End of 2008         End of 2009
         Brazil             2008                         0                   0            150,000       ISDB-T
         China              2008                         0           600,000            5,000,000    CMMB/STiMi
         Germany            2008                         0            10,000               50,000        DVB-T
         Italy              2006                  700,000            850,000            1,000,000       DVB-H
         Japan              2006               25,000,000         40,000,000           60,000,000       ISDB-T
         Netherlands        2008                         0            90,000              180,000       DVB-H
         Russia             2006                   10,000             20,000               30,000       DVB-H
         South Korea        2005                1,500,000          1,850,000            2,000,000       S-DMB
         South Korea        2006               13,000,000         15,400,000           17,500,000       T-DMB
         USA                2007                   50,000            100,000              400,000      MediaFLO
         Other             Various                 50,000             65,000              275,000       Various
                                               40,310,000         58,985,000           86,585,000

                                                                                           Source: Rethink Research
FOTA: From Hype to Market Reality
There is no conditional access system on this service              Mobile TV broadcast into the same spectrum such as
as it is free to air, and the TV channels mirror the local         ISDB-T or ATSC M/H. There are others which are
TV franchises a little like the US with 47 local legal             satellite terrestrial hybrids such as the Chinese CMMB
jurisdictions. Tokyo leads with channels from the                  STiMi system, which actually delivers the signal in two
dominant NHK (Japanese Broadcasting Corporation)                   spectrum slices – one from a satellite in 2.6 GHz and
which is funded across Japan by a public TV license,               one in the usual TV spectrum around 700 MHz. Alcatel
with additional TV channels from NTV, MX TV, the                   has its own system which works similar to this but
Japan News Network, the Fuji News Network, TV                      targets a single frequency network both from the
Asahi and TV Tokyo Network.                                        satellite and terrestrial repeaters.

In 2000, Japan authorized digital TV by satellite and
then began laying out ISDB-T terrestrial systems three
                                                                   Developments in China
years later which took until the end of 2006 to be
nationwide. In April 2006, 1-seg programming was                   More important is the choice of business model, and
retrofitted to the service, and the built in Broadcast             the big launch during 2008 was China. This will ramp
Mark Up Language is used as a data-transmission                    in 2009 to what the Chinese authorities hope will be 12
technology to allow text to be displayed on a 1seg TV              million viewers, but which we have projected as 5
screen. This means that external links from the TV                 million, because chip shipments suggest that the figure
screen to promote interactive m-commerce is possible.              will be closer to this.
Japan is at the stage now that if a viewer sees
someone on TV wearing something they like, chances                 We also think the Chinese Mobile TV satellite will go

are they can buy it from their phone.                              up late and that uptake of video handsets will be
                                                                   confused by the fact that there are already 3 million
Originally all content on 1 seg was simulcast with the             video handsets in China offering analogue TV on a
local TV channels but this restriction has now been                handset. We also think that prices will not come down
lifted by the regulator and new programs are now                   fast enough because too few non-Chinese companies
appearing specifically for 1 seg.                                  had anticipated this system being a success, and have
                                                                   failed to position themselves within the market.
Around the rest of the world there are two main types              However, in the medium term, China will overtake
of transmission technology and two main types of TV                Japan and become the biggest global market in
bouquets and business models. The transmission                     broadcast digital Mobile TV, just ahead of India.
technology either requires an entirely new network,
such as DVB-H or MediaFLO or it uses the existing
digital transmission of the TV stations, and squeezes a

Services expected to launch in 2009

        Country       Launched      MoTV Handsets            MoTV Handsets       MoTV Handsets             Technology
                                     End of 2007              End of 2008         End of 2009
      India              2009                        0                       0           1,500,000        DVB-H/DVB-SH
      South Africa       2009                        0                       0               180,000         DVB-H
      USA                2009                        0                       0               550,000   ATSC M/H/others
      Other              2009                        0                       0               655,000         Various

                                                                                                   Source: Rethink Research
FOTA: From Hype to Market Reality
India - Sleeping giant in Mobile TV                         Europe’s progress
The Indian market will see spectrum auctioned in 2009       In Europe, we expect Italy and the Netherlands to add
for both terrestrial and satellite Mobile TV systems, but   subscribes at a steady pace, while the efforts in Austria,
we think it is unlikely that any devices will be on the     Switzerland and Finland will be in the low thousands.
market before the last quarter. The bulk shipments will     Germany will continue its forlorn experiment with DVB-
come in 2010. There is a good chance that India will        T, and this may prevent any serious Mobile TV
use a combination of DVB-H and a satellite system,          services from being launched there either at all, or until
either DVB-SH from Alcatel or the Chinese system.           2010. French services will not start until at least 2010
The incumbent broadcaster Doordarshan already has           and the UK more like 2012.
8 MHz of spectrum and will try to launch using DVB-H
before new spectrum owners. However, it will not be         The Italian system is sold by 3 Italia as ‘Walk TV’ and

surprising if this is delayed, as India can be slow         although Vodafone and Telecom Italia Mobile have

getting things started.                                     working DVB-H systems, they have not pushed them.
                                                            The Italian experiment gives a good roadmap on how
                                                            to promote a paid service in a modern, saturated
                                                            cellular market which is also rich in cellular streaming
Korean market still growing
                                                            content. The service was launched with older LG and
After Japan, Korea is the next fastest growing Mobile       Samsung handsets, but has just added the Nokia N96.
TV market, and it already has over 17 million
customers. There are two systems, a satellite service       The system is protected using a Nagravision DRM

launched in 2005 which uses a pay TV approach               based on the DVB Open Framework but this has been

called S-DMB, and a free to air terrestrial system          quietly moved to simulcast so it also offers OMA and

called T-DMB.                                               will later move to the OMA BCAST Smart Card Profile
                                                            to accommodate the N96. The network covers 75% of
Total subscribers to the two combined Korean Mobile         the land area although indoor coverage is patchy, and
TV systems have now reached 17.25 million at the end        the service cleverly balances live sport (soccer), adult
of 2008. T-DMB has reached 15.4 million - up around         coverage, local drama and music TV. The service was
70% on a year ago - and S-DMB has begun climbing            launched on the back of World Cup Soccer coverage
again after a relatively static period, reaching 1.85       during 2006. It offers six free TV channels and 11 paid
million. The Beijing Olympics was key to accelerating       channels plus adult content and has a Barker Channel,
these numbers. This represents a 35% penetration for        called La3 Live, a free channel about what’s on the
Mobile TV devices in 3 years, peculiarly many of the T-     other paid channels, produced for practically nothing.
DMB systems are not handsets but specially built TVs,
MP3 players, laptops and GPS systems.                       3 Italia pushes bundles offering TV plus internet
                                                            services, plus some talk time. It also ingeniously uses
We expect the Korean market to add another 2.25             the time between channel changes for advertising.
million devices during 2009 as it begins to saturate.       Customers have risen from 6.8 million when the
Korea only has around 49 million people. For the US to      service was launched, to 8.45 million, with at least
achieve a similar penetration rate to either Japan or       400,000 of those directly attributable to Mobile TV.
Korea it would have to sell over 100 million broadcast
Mobile TV devices in the next 3 years – which would
be hard to believe. It may be that the US and Western       Other regions
Europe, tied as most TV efforts are to a pay TV model,
will develop far more slowly. ATSC M/H is the one           In some instances, less sophisticated countries will

exception and we expect it to rocket to half a million      grow faster than highly developed countries, owing to

customers in its first full year.                           low television penetration. These countries may opt for
                                                            either low cost portable players or PC dongles to
FOTA: From Hype to Market Reality
distribute TV to areas which have mobile coverage, but       subsidized or partially subsidized, depending upon the
where there are low densities of television sets. This       territory they are launched in. Later, paid services can
may well be the case in both South Africa, expected to       be integrated on the same device but this requires
have its licenses allocated this year, and in Brazil,        planning so that DRM is part and parcel of the initial
where there has been a slow uptake to mobile TV.             product offering. Owners of content supplied through
Here, networks are using a variant of ISDB-T from            free to air services would rather see it encrypted for
Japan and have very few devices for people to choose         piracy protection – doing so will encourage greater
from. All ISDB-T devices in Brazil incur an 85% import       access to content.
duty unless they are locally manufactured, and this is
impacting device affordability, which in turn is hindering   Finally, Mobile TV designed to reach handsets should

the rate at which broadcasters are adding a digital          not be offered in isolation. To get real momentum,

signal. We expect this deadlock to begin to break in         other devices should be embraced, especially laptops

Brazil at the end of 2009. Also, broadcasts are              using inexpensive dongles and specialist GPS devices.

currently in limited areas.                                  In Japan, even Apple has even given permission for
                                                             the iPhone to be supplied with an ISDB-T antenna and
Russia appears to have a haphazard approach to               software.
Mobile TV, and has mostly opted for DVB-H, when
much of its terrain would have better suited a satellite
based set up. However, Moscow should have multiple           The outlook for Mobile TV
services available this year, and up to 17 other major
cities have been promised to be readied this year by         As we look forward to 2010, the US market will begin

Sistema Mass Media. This is one of three separate            to speed up, bulk uptake will begin in India, and China

Mobile TV efforts, and eventually devices will begin         will definitely be getting up to speed in terms of

shipping in volume, though we have only anticipated          delivery of specialist handsets. The Chinese ministry

minimal penetration at first.                                SARFT (State Administration for Radio, Film and
                                                             Television) says that it expects 10 million CMMB
                                                             devices sold in 2009 and around 50 million the
                                                             following year, but even at the more likely delivery rate
Rules of thumb for success
                                                             of half those numbers, that would still see Chinese
There are lessons that these launches have shown us          Mobile TV handset annual deliveries overtaking Japan
and golden rules can be extracted on how to go about         as quickly as 2010, recession permitting.
launching services. One key factor that has caused
operators to stumble is lack of an attractive range of       One wild card that seems to have lost its appeal is the

devices. In some cases handset vendors have simply           cellular multicasting standard MBMS. This will be

reneged on deals to deliver devices on time for service      enabled in all future mobile base stations and requires

launches, because they have other priorities with            a software stack to be loaded at the factory into

firmer orders.                                               HSDPA handsets. While we expect MBMS and CDMA
                                                             multicast services to take off, which will allow
Also, virtually no advertising efforts can be                something like six high quality TV channels to be
incorporated into the service until a customer base is       broadcast to multiple devices over the cellular network,
established – this could take two years. Japan and           we no longer see this as competitive with broadcast TV
Korea are now steadily attacking the advertising             services – but complementary and will be used
opportunity, which will provide a roadmap for other          primarily to relieve backhaul pressure in existing
services, especially the fledgling Chinese service, to       cellular streaming services. This will probably not
follow in years to come.                                     emerge until the 2010 time frame (having gone awfully
                                                             quiet throughout 2008) and result in yet another surge
In order to get people watching mobile TV, an element        of cellular streaming activity.
of the service should be free, on handsets which are

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