Indian public broadcaster Doordarshan has said publicly this week that it will search for a private-public partnership to bring its 8 MHz of mobile TV spectrum to the market. This will almost certainly have the effect of slowing down the introduction of Mobile TV in India.
Doordarshan had given the impression that it wanted to accelerate its Mobile TV system, and even now is saying that it will seek a roll out in 17 cities, each with over 1 million population (so that’s 1.7% of the population)
But Doordarshan (DD) said that its contribution will be to provide TV towers and spectrum, which means that the cost of the entire DVB-H network is going to be pushed onto a partner that doesn’t even get the benefit of owning the network. The idea is that a 5 year deal would be signed. In the current environment of business model uncertainty over Mobile TV platforms around the world, where none of them are yet profitable, it is unlikely anyone could be sure of getting their money back in that time frame, especially when it is giving DD a hefty share of the revenue.
This less ambitious approach to Mobile TV is probably due to the fact that regulator TRAI, which has said that it will auction another 8MHz of UHF for terrestrial Mobile TV and a similar amount of S-Band spectrum for satellite based Mobile TV, has not moved forward. The deal to go to auction was announced in December 2007 and not a single word has come from TRAI since.
However this month TRAI has found itself a new Chairman in J Sarma, formerly Chairman of India’s Telecom Commission and a member of the Telecom Disputes Settlement and Appellate Tribunal. Sarma has criticized TRAI for its lack of transparency in the past and his first jobs will be to manage the more significant 3G and WiMax auctions as well as to come up with a policy so the country is not swamped with DTH licenses.
He may decide NOT to auction that Mobile TV spectrum at all, but to allocate it based on the ability to deliver services ‘ a growing trend among some regulators ‘ or to charge based on service performance over time. Either way it looks unlikely that rivals will bring Mobile TV to market in India now much before 2011, so suddenly DD feels that it is in a strong position.
We have to remember that this is a market that is growing faster in numerical terms than any other market in the world, and where Nokia currently holds an 80% market share. Nokia really has to maintain ALL the edge it can in India and if it was not for the fact that Nokia is going through divestments due to the economic conditions, you might expect it to step forward and run the Mobile TV service in partnership with DD.
But Nokia is making divestments and one of them is the server element of its Mobile TV system. Back in April it sold its Nokia Mobile Broadcast Solutions unit to India IT Services firm Wipro, transferring 40 employees.
Quite rightly Wipro has realized that suddenly in India and the surrounding regions, this will be a hotbed of Mobile TV implementation, but also Nokia must have realized how little revenue such a unit would bring in, compared to its existing global revenues, and it was almost certainly loss making.
It could be that Wipro is putting together a team to be part of the DD private-public partnership, but this seems unlikely to us.
Doordarshan has had a long term Mobile TV pilot in Delhi and this used DVB-H technology from Nokia. TRAI was thinking in terms of offering new licenses as technology neutral, but the new Chairman may revisit that decision.
The big problem for Nokia here is that it has doggedly refused to offer cheap DVB-H phones anywhere in the world, and its previous thinking has been that DVB-H would be a selling point of its top end phones like its N96 and N97. India would need a home grown $35 to $50 phone to bear the brunt of DVB-H uptake, and if Nokia was to produce something like that, the rest of the world would cry foul and demand that Nokia make one for other fledgling DVB-H Mobile TV offerings.
The DD plan talks about a 16 channel service launching in the major cities with the private partner choosing and negotiating for 12 of these channels on a revenue sharing basis. The private partner will also be responsible for content aggregation, marketing, operation and maintenance. Everything really.
This will end up like DVB-H in France, meant to be ready in 2007, it might come to market in 2010, three to four years late. A similar delay in India would mean that the big impetus that India would give to Mobile TV handset volumes would perhaps not happen until 2013.