China’s determination to go it alone in technology and the government’s almost iron control of the economy, has almost stalled its Mobile TV effort there ‘ with shipments stopping completely as it turned out that the last straw of adding a second conditional access/digital rights management system to the already heavy burden of building a new technology infrastructure, almost forced everyone out of the business.
The impasse has made the State Administration of Radio, Film, and Television (SARFT) predictions that it expected 10 million CMMB devices to be sold in 2009 and around 50 million during 2010, look faintly ridiculous, but now our Chinese contacts tell us that the system has once again been kicked back into life, and there is some evidence of that, in a new chips announcement this week, from the market leading chip supplier forCMMB (China Multimedia Mobile Broadcasting) system, Israel’s Siano Mobile Silicon.
When we last looked at China it looked like it was past the effort of creating its own weird hybrid Mobile TV radio technology to cope with its particular geographic and demographic problems. STiMi technology, part of SARFT’s CMMB initiative to create a homegrown Mobile TV technology ripe for export, uses two distinct spectra ‘ S-Band which comes from a satellite and UHF for terrestrial transmitters. But then last year the SARFT controlled China Satellite Mobile Broadcasting cancelled a deal with an EchoStar affiliate to provide the satellite portion of the signal across the entire country. China still insists that the CMMB system will have two distinct radio components, but is giving no indication of when a satellite might go up, and instead it has now built out 186 cities using the terrestrial only component of the signal, and will push on to 300 cities by the end of this year.
To equipment suppliers, this sort of change of plan and uncertainty is discouraging. Do they need on-chip dual spectrum diversity built into their chips or not? The last straw was when SARFT finally convinced China Mobile, with its new TD-SCDMA network to jump on the bandwagon. The first thing that it did was to mandate its own, fresh conditional access system, one designed locally, even though SARFT’s broadcasts were already being sent out encrypted using a Nagravision system. It was this final straw that stopped sales of the Mobile TV system, back in March of this year, while all the suppliers gave it some thought and consumers wondered about just how many channels would remain free to air (China has always said that it would run the system with around 25 channels with 8 or 9 free and other paid bouquets but the whole thing was free for the first year).
So from the August Olympics until November last year we estimated that only 600,000 devices shipped, almost exclusively these were NOT mobile phones. SARFT claimed that number was closer to 1.2 million, and then boasted that 10 million more phones would be shipped by end of 2009, but then the marketing wheels came off the CMMB wagon.
In the end around 1.5 million devices got shipped up until the end of March, but the rate slowed down considerably in the early part of 2009. Not only was SARFT going to stick to its plan of encrypting its broadcasts (devices all had to be Nagra ready) but a new simulcrypt would be needed with the new China Mobile conditional access system, even though it would be selling more or less the same bouquet as SARFT’s broadcasting arm the China Broadcasting Company.
For a company like Siano this meant yet another investment in another tape out of yet another chip design, which for a start up must have been a tough choice. Given it had design wins in Aigo (MP3 players), ZTE, Samsung, Huawei, Tianyu and CEC Telecom it probably made it worthwhile, and this week it has announced a chip (the SMS 1186) that can cope with both conditional access systems and the onboard spectral diversity, as well as decoding.
The SMS1186 is aimed at mobile phone and netbook makers and offers sensitivity of -100dBm, the company claims. It includes the secure “root-of-trust” hardware (known as UAM) which adheres to China Mobile’s latest data security requirements and can perform CMMB real-time descrambling on-chip.
It’s a big gamble for Siano, and it must have a lot of projects in the air right now, but the big prize is market leadership among a cellular player with 420 million cellular subscribers ‘ the largest by customer numbers, in the world. Since the chip has emerged we have been told that Motorola has signed up for Siano as its CMMB supplier as well, while Nokia continues to sit on the sidelines in China, content with a strong market share, but with no plans to make CMMB devices (it has always said that it will only offer DVB-H as a mobile TV technology, though once India and China begins to motor in mobile TV, it will be forced to follow whatever their technology choice is).
Suddenly once again CMMB devices are shipping, we estimate at around 200,000 devices a month, and Siano claims that it has a 50% market share right now, and that only local rivals Innofidei and Telepath are going up against it, with none of the giant international chip vendors coming to market with a chip.
Along with those devices which cannot pick up China Mobile broadcasts, that brings total CMMB installs to around 2.2 million and on track for something like 3.5 million by year end.
We spoke to Siano CEO Alon Ironi who said, ‘China Mobile is very determined to make this happen and it is mandating that all top end TD-SCDMA phones have CMMB pre-installed. We think all the obstacles are out of the way of CMMB now.’
But the design target is still unclear. It would be easier to install two antennas and get some level of antenna diversity on these devices from multiple transmitters both in the same UHF band, operating as a single frequency network, rather than listening for a boost from a satellite band which is unlikely to be launched before 2011. In fact if the CMMB system goes to 300 cities in China it is in reach of 50% of the population, and a satellite may no longer be the right way to go and it might never get launched, which could put all the existing silicon vendors at risk, as it would make future designs easier to come up with for latecomers.
The only reason that China will go ahead and launch a satellite now is if the urban population begins buying phones in high numbers which are in the same class or cost as those which are being used for TV in the cities. If that happens, then the satellite will pay for itself. Also the CMMB standard will likely retain the satellite element in order that other regions, notably India and Africa, are likely targets for China to export this technology, and in those regions a satellite is the most economic way to build a footprint. We know already that one Middle East operation, S2M plans to launch across the Middle East and Africa using the satellite portion only of the Chinese CMMB technology, and if that portion of the standard fell into disuse due to a lack of a Chinese satellite, then the export market for devices would fall.
And right now the full 25 channels which were promised are not being broadcast in most regions, more like 10 or 12 channels, so exactly how big the paid for bouquets will end up and what will be left for the free to air portion of the broadcasts, is anyone’s guess.
We understand that the pricing on the paid bouquets is expected to be far lower than originally planned (it was meant to be around $10) and will now be as low as $2.50 or 20 RMB (Yuan).
The response from the other Chinese cellular players ‘ Unicom and China Telecom is yet to be seen. The same chips can be used on their devices, even though they use CDMA and UMTS transmission for their cellular lines, since CMMB is a completely separate broadcasting signal, but some of the handset providers are different and would need time to get up to speed.
So far in Mobile TV development, wherever one player has pushed free mobile TV in their phones, then everyone else has had to follow. Where someone has pushed paid mobile TV, there has been less need to respond. So with a hybrid system, some free, some paid, this is going to be a tricky thing to guess. If there are something close to 8 free channels eventually, then a bandwagon will form. Imagine a Chinese market which follows Japan, where recent figures show us that now 81% of all phones shipped into the market have the capability for ISDB-T 1-seg mobile TV, up from 61% last year.
That development took around 5 years, which would put China with around 300 million mobile TV capable devices in that same time frame, say 2014. It’s seems an omission that not a single US or European handset or chip company has taken that potential outcome seriously, which would make Siano a prize asset for the major US and European chip vendors such as Broadcom, Qualcomm and NXP, if its gamble pays off.