AT&T Launching Long-Threatened Mobile TV Service
AT&T has been talking about launching mobile TV for more than a year; during that time Verizon has been offering its own version of MediaFLO service and the response has been underwhelming. Qualcomm (QCOM) CEO Paul Jacobs in March said the service had been a disappointment, but declined to provide numbers. M:Metric estimated at the time that only 1.5%, or 820,000 Verizon subscribers had watched TV on their phones. In Europe, where several operators offer mobile TV, fewer than 1% subscribe.
AT&T's service comes with the same catches as Verizon's. Namely, you've got to buy an expensive phone ($200-$300), and subscribe to a data plan for $15/mo. for just TV or $30 if you also want Web browsing. This won't work on Apple's iPhone, one expensive product AT&T customers are willing to buy.
Yankee Group says 5% of mobile subscribers are actually willing to pay for mobile TV, but even that limited group is thinking five bucks a month, not the $15 to $30 dreamed of by At&T and Verizon.
Related: Qualcomm CEO: No One's Watching Our Mobile TV Service
Nokia Exec: Mobile TV Stalling
And while DVB-H and FLOW and their flawed business models continue to fail or only slowly progress (DVB-H in Italy is a flop, depsite TIM and Vodafone investing in it), there are three examples of successful mobile video.
One is in Japan, with over 20M mobile viewers (a reasonable number to start paying attention). The second in Korea, where there are about 7M.
But the third is by far the smartest and most exciting, in my opinion. It uses the analog TV infrastructure in China (and people in the US forget this, but over 90% of the world is not about to move away from digital TV). It is a free TV offer. There are about 5M users, growing at more than 80% p.a. It is drive through the Chinese retail market, by Chinese and Taiwanese ODMs.
This will be big in the BRIC countries, plus Indonesia, Russia, and possibly Western Europe where free over the air TV is still important and will migrate to DVB-T.
Broadcasters will love the increased audience, and carriers and OEMs will add the features to drive increased attachment to the handsets (and hence increased usage), and no marginal cost and with no financial risk to them.
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