Qualcomm this week has told staff that it will close its FLO TV services in the US by Spring 2011, after only a year or so of operations ‘ it is in understood to be in discussions with AT&T and Verizon in how to terminate or transfer their white label versions of the same mobile TV broadcast system, which might end up available through the cellular operators’ own streaming service.
Qualcomm issued a statement saying that this was because of the interest shown in using the spectrum or existing system to deliver on ‘the growing imbalance between mobile data supply and demand, the growth of tablets, and consumer demand for high quality video and print”
It doesn’t sound to us like there is any interest shown in anything but the spectrum, something we said originally when Qualcomm put it up for sale. Right now the digital exciters and transmission equipment is geared to creating new broadcast streams that can only be deciphered by MediaFLo chips. The spectrum could be re-geared either to deliver traditional cellular streams or to broadcast them, and this network would be far more useful as a single directional broadcast system. Offloading services like delivering video and ebooks, one way, after a cellular request, might be valuable to someone, but it would need to be with a format of encoding that handsets are already familiar with, not a MediaFlo chip.
Which is why we think the service has been scheduled to close ‘ primarily so there is a drop dead date for customers, which gives a timeframe to change the modulation to something more useful to a cellular carrier like AT&T or Verizon.
A month or so ago Qualcomm CEO Paul Jacobs said that the service would be sold as a going concern, but here at Faultline we disagreed with him, and said that before the year was out the spectrum may well be sold separately from the service.
What we have to understand here is that this does not mean the long forecast end to mobile TV in the US. It hasn’t worked, quite simply because nobody has tried it the way it has been tried in Japan and Korea, where it is a smash hit. The formula is simple, mobile TV has to be free to air, there needs to be a wide variety of devices it is available on, and the content should be the same content that is on local TV.
The only US initiative which could offer that is the ATSC M/H system for including a mobile signal in one designed to send SD and HD content to TV sets through the air. This is analogous to the Japanese ISDB-T system, and its One seg mobile signal. The actual design of ATSC M/H is even better than ISDB-T simply because it offers the mobile broadcasts in bursts so that the radio can be turned off most of the time, saving battery, and collects 3 or 4 seconds of video each time it is turned on for a fraction of a second, sent faster than real time in much the same way that DVB-H and MediaFLO worked.
This is set to go into production in handsets sometime now (see separate story on Siano) and will slowly ramp until it peaks in 2012.
Most US analysts see this as unlikely, and make a lot of noise that video over 3G or WiFi is plenty good enough. However the cellular networks can only support around 20 video recipients in parallel per base station radio and that’s way less than the number of people that want to watch TV at any given point in time. That isn’t set to change until LTE is in its second roadmap stage of data delivery and is nationwide ‘ in other words until around 2020, and even then the huge amount of data that it delivers will likely be used up by other applications.
Qualcomm said that it will stop selling to any new customers now and will maintain the network so that current direct to consumer subscribers will continue to receive FLO programming into Spring 2011. If it has to give refunds to anyone at that point it will.
FLO TV failed because it cost money and the special devices required to receive it were never subsidized fully by the US operators, nor was there sufficient incentive for AT&T and Verizon to heavily market the white label version of the service. Those services will continue indefinitely and there is obviously still some hope at Qualcomm that it will be able to tweak the network to support new applications as well as continue the TV services to these cellular giants for some time. However neither service has taken off and this is because it only delivers content which is largely a subset of TV content which TV companies thought might go down well on cellular streaming services ‘ short form content largely with no live sports. So the content deficiencies of Vcast TV and AT&T’s TV services would have to be adjusted if this was to become a long term proposition, and we just can’t see that happening.
This leaves the US field for Mobile TV open to ATSC M/H, which will shortly move from having 70 TV stations in around 34 markets, to supporting 500 by the end of 2011.
MediaFLO, the technology behind FLO TV, will continue to try to gain a foothold somewhere in the world, but this has suffered recent set backs. In Japan the follow on standard for ISDB-T is likely to be an extension to that technology, instead of MediaFLO, and in countries like Hong Kong and Taiwan, where it is being bid alongside DVB-H, there is no will among operators to go ahead and launch new mobile TV services.
In the UK where Qualcomm bought spectrum cheaply in the L-Band range, there is no chance a mobile TV system which requires special chips will be launched, now that the US operation has failed. All of which means that if MediaFLO is not dead as a technology, it’s on its last legs.