Two companies — MobiTV and FLO TV — are offering subscription-supported, full-motion mobile video services filled with popular broadcast and cable programming. And they may be open to partnering with TV stations for local material.
If broadcasters follow through in their planning and launch a commercial mobile DTV service next year, they will not be alone in the mobile video market.
Two companies — MobiTV and FLO TV — are already offering subscription-supported, full-motion mobile video services filled with popular broadcast and cable programming.
But at least in the case of MobiTV, the competition could give way to cooperation. MobiTV sees TV stations as partners in helping to deliver video to its mobile customers.
And while FLO TV is not interested in teaming with TV stations in distributing its service, it may be interested in stations’ local programming.
FLO TV will not say how many subscribers it’s managed to sign on while MobiTV claims 7 million. Either way, analysts who track the market do not think the numbers are great. Subscribership also fluctuates because users frequently churn in and out, said Jeff Heynen, an analyst at Infonetics Research, so it’s difficult to pin down a specific number.
John Fletcher, an analyst with SNL Kagan, pegs MobiTV’s subscribership at around 4.4 million and FLO TV’s at less than a tenth of that, 400,000.
Fletcher attributes the disparity to a couple of factors. MobiTV is available through all the major U.S. carriers and its service can be received on most late-model cell phones and other handheld devices because it operates on the carriers’ wireless frequency. Sprint brands the service as SprintTV.
FLO TV, by contrast, is available only through AT&T and Verizon on just nine phone models that have been equipped to receive signals from FLO TV’s proprietary spectrum.
FLO TV is generally pricier, too. MobiTV says its monthly fee is dependent on the carriers and what services are purchased but averages about $9.99. FLO TV’s base price is $15 a month. Both services can cost more depending on what additional content subscribers may buy.
Even though the services have barely dented the mobile phone market, Fletcher remains bullish on their prospects. He estimates that MobiTV, which has raised $120 million in venture capital to date, pulled in revenue of $70 million in 2008.
Heynen also sees upside to mobile video. “I see the most successful model as one that combines broadcast, unicast and side loading where you take your phone and plug it into your PC and download videos to that device. All three of those different media play off each other.”
MobiTV cherry picks programming from cable networks, including CNBC, Discovery and the Disney Channel, and offers it along with popular broadcast network shows like The Office, Parks and Recreation and CSI: New York.
But rather than offering the shows as full-length linear streams, says Ray DeRenzo, MobiTV’s CMO, it chops them up into “more digestible 10-minute segments” that on-the-go subscribers can view piecemeal as they get the chance.
DeRenzo says that MobiTV still has plenty of upside. “It has not been significantly marketed and positioned by wireless carriers,” he says. “The great majority of wireless users are unaware that you can watch live television programming on your mobile phone.”
Broadcasters are an attractive partner option for MobiTV because they come with bandwidth — a conduit for delivering video downstream to consumers, DeRenzo says. MobiTV would continue to use the carriers’ spectrum for the upstream commands from the consumer but could use the broadcasters downstream to deliver high bandwidth content.
The broadcast spectrum might also help the new video-on-demand service that MobiTV expects to introduce by the end of the year. Consumers will be able to download an entire episode, store it on their wireless devices and watch it later without being connected to the carrier’s network.
The Open Media Video Coalition, the consortium of broadcasters and mobile equipment vendors that is pushing the technology, is considering an interactive model of working with carriers or service providers like MobiTV that use the carriers’ upstream spectrum, says James Ocon, vice president of technology, Gray Television.
“It’s a really nice partnership where the high-quality bandwidth video side comes from broadcasters or people that own the transmitters and the return channel side or the interaction is taken care of by the cell providers,”
MobiTV is an active participant in the OMVC as well as contributing to the interactive portion of the Advance Television Systems Committee Mobile/Handheld standard, the digital standard on which mobile DTV is based.
FLO TV has all the spectrum it needs, having acquired UHF ch. 55 in every market of the country, giving it a national footprint. FLO TV broadcasts 20 channels of live streaming video from national programmers like ESPN, MTV, Comedy Central, NBC, MSNBC, CNBC, CBS and Fox.
And FLO TV believes broadcasters’ local programming could enhance its service offering, says Jonathan Barzilay, senior vice president of programming and advertising.
“Broadcasters have “a lot of strength around live news and sports,” he says. “I just don’t think that the digital broadcast model is developed enough yet for us to truly understand how that will play out.”
According to Barzilay, subscribers watch about 30 minutes of programming a day, which, spread over two to six daily visits may seem like an eye blink to broadcasters accustomed to couch potatoes spending hours in front of televisions.
Barzilay, however, finds it “very encouraging.” After all, he says, people talk on mobile phones only about 28 minutes a day.