We have been saying for just about a year that one of the key triggers for US mobile broadcast TV would be when the national broadcast groups jumped into the equation, as they did in successful launches in Japan and South Korea ‘ in fact in those countries they led the development of the technology.
This week Fox and NBC, a long rumored pairing, joined with the otherwise unlikely broadcast combination that had formed the Pearl Project last year, with the local broadcast portion of that turning itself into the Pearl Mobile DTV Company. The details were announced at NAB (National Association of Broadcasters conference and exhibition in Las Vegas), the natural launch pad for broadcasting initiatives in the US.
The Pearl initiative now embraces Belo, Cox Media, Scripps, Fox, Gannett Broadcasting, Hearst TV, ION TV, Media General, Meredith, NBC, Post-Newsweek Stations and Raycom Media.
The news release blasted us with the fact that a ‘dozen companies’ were involved, but the true weight behind this move is the addition of Fox and NBC. Among those following the ATSC M/H developments in the US, which the trade group OMVC now calls Mobile DTV, their involvement has been an open secret for almost a year, shadowy figures behind the scenes unwilling to commit their hands too early or let their rivals fully understand what they were up to.
In our latest Mobile TV report ‘The Rise of the ATSC M/H machines,’ Faultline predicted that this declaration could take until the end of 2010 and that a network supported by both their directly owned broadcast stations and their affiliates, might take until the end of 2011 to be built, making 2012 the year of Mobile TV in the US. In that time frame, in a world hell bent on Over The Top video, specifically with Apple and Google about to launch TV initiatives, it seems like Broadcast Mobile TV might get swamped in the rush to take TV to phones by another route ‘ over Wi-Fi and 3G.
But both Japan and South Korea both had extremely advanced streaming video services before their broadcasts were launched and yet the ubiquity of the ISDB-T service now extends to 85% of Japanese handsets delivered, so perhaps the obsession with wi-fi and 3G streamed video was needed before cellular operators could fully understand what a threat streaming video is to the integrity of their networks, and then make them embrace broadcast Mobile TV with or without an easily identified business model.
The new grouping will beat that 2012 timeframe by more than a year and complete the installation of ATSC M/H digital exciters to send signals over their transmission networks, by the end of 2009. An OMVC sponsored mobile DTV trial will begin next month in Washington DC and this should also act as a proving station for devices and a springboard to a national launch in time for Christmas, if you count 150 million heads of population as a national launch. Effectively that’s 50% of the US.
The standalone joint venture promises that live events, local and national news from print and electronic sources, as well as sports and entertainment programming and it promises and on-demand video as well.
The only way it can do all of that is to broadcast newspapers as files, almost certainly ebook files, between the broadcast video or overnight, and offer push VoD, programming that is sent as files and stored on remote devices. This is the equivalent of a new national broadcaster launch, targeting mobile phones, smartbooks, netbooks, in-vehicle devices and even static set tops and PCs.
The spectrum to be used for the new mobile service will come from the three owned-and-operated station groups Fox, NBC, and ION plus nine local broadcast groups – Belo, Cox, EW Scripps, Gannett, Hearst, Media General, Meredith, Post Newsweek and Raycom.
Separately, these nine local broadcast companies formed Pearl Mobile DTV Company LLC as a vehicle for their involvement in the venture.
The Pearl Project launched last December and said it was looking to raise capital and cut deals with carriers, receiver manufacturers, retailers, content owners and advertisers, so that still may be the case.
And at NAB these players are making no secret of the fact that other broadcasters are queuing to join them, but has said that for now it wants to build its network and set its rules before letting anyone else into the equation. That raises the prospect of CBS and ABC providing the kernel of a second group and going up against this one head to head, further accelerating mobile DTV in the US.
This is the big carrot for cellular operators and we can’t see why devices using ATSC M/H should cost any more than those without. Sure there is a $10 bill of materials, but the handset vendors have a vested interest to make them popular. In other major markets where mobile broadcast TV has taken off, it has been the availability of at least four or five devices that has triggered the market, and these both need to include existing high profiled devices and new cheap devices ‘ so we’re not quite there yet despite some more device launches at NAB. If that happens it will make it very tempting for companies like Verizon Wireless and most non-AT&T Mobility cellular players could join the push ‘en masse.’ (After all AT&T has the iPhone and buys into its streamed strategy).
In fact there must be some temptation for AT&T, once it loses its exclusive on the iPhone, to embrace Mobile DTV earliest in order to replace its iPhone appeal. The iPhone has been responsible for almost all AT&T Mobility customer growth during the past year and it will need multiple initiatives to replace it, once gone.
The venture can even argue that by taking video off the cellular networks (at least not all video will go over cellular) it will complement the FCC’s National Broadband strategy by giving broadband over to web function and reducing cellular data congestion.
Jack Abernethy, CEO of Fox TV Stations, said, ‘We are excited about building a platform that makes mobile television universally available and economically viable. This venture is the first step in forging cross-industry and company partnerships to deliver content to consumers.”
There is still of lot of work to be done in bringing a successful mobile TV strategy to the US. The system needs to become interactive, and the natural return path for advertising is the cellular network, and for that this group needs a sign in from at least one major cellular network. But we would expect to see more devices launched next and put into the market cheaply, and then some level of cellular subsidy being attached to them in return for perhaps a revenue share on advertising. Another business model that has been suggested is that the cellular operators could offer the same content in parallel in VoD, as a catch up service and that this would drive data revenues and be a paid streamed service, while the broadcast content would be free.
Gradually more and more suppliers are beginning to put the words ATSC M/H into their marketing at the show, and last week Ericsson launched an ATSC M/H eco-system using encoders from Envivio and M/H multiplexing from Axcera, and DibCom at NAB has been pushing its Octopus chip, which will shortly have an ATSC M/H variant. What the eco-system really needs is a second merchant chip around which to build devices. Currently they are all being supplied by LG Electronics, which is also driving devices itself. Samsung has a chip for its own devices right now, though that might soon be more widely available, but one of the specialist designers for broadcast mobile TV, notably Siano Mobile Silicon – which dominates in China, and MaxLinear – which dominates in Japan, need to enter this space. That will give equipment designers more confidence to build a product and likely cheaper chips with even better reception.