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| Diana Jovin |
Diana Jovin, VP corporate marketing and business development at Telegent, discusses the alternatives for operators looking to launch this high cost service to its low cost target audience.
There are 51.6 million smartphone subscribers in the European Union, according to ComScore. This provides a huge opportunity for mobile service providers to deliver premium data services. However, many of these subscribers are young people who are not able to afford the big bills often associated with data-hungry, services such as video.
The success of smartphones can, in part, be attributed to the fact they provide access to the mobile internet, giving access to familiar content from the web on the go. But while the devices are becoming more affordable, and people are using them to access the sites they know and love, many young people (who are likely to adopt new mobile services) do not have smartphones with unlimited data packages, which makes them reluctant to pay for content.
Premium services
In Europe, these services (in particular video-based services such as mobile TV), tend to be offered as ‘premium’ services on smartphones, if at all. The availability of mobile TV in the European market contrasts sharply with developing markets, such as Africa, Asia Pacific and Latin America, where mobile TV is proving extremely popular.
Handset manufacturers are embedding a mobile TV feature into a range of devices that range from high end Android smartphones to low cost feature phones, where mobile TV is offered as a standard feature alongside SMS and voice.
To date, European operators and consumers have been understandably held back by regulatory and standards confusion, unproven technologies and the costs associated with building and operating mobile specific TV platforms. All of these issues can be avoided by using the existing broadcast TV infrastructure and building the receiver technology into the handset.
No big surprise
This should not come as a great surprise since free access to a wide range of quality programming is what has underpinned the traditional broadcast industry for decades. It is also a model that has an established and viable business model, even if it is one that may be unfamiliar in the mobile sector.
In a recent study we conducted with YouGov, we discovered there is a significant opportunity for free to air mobile television in Europe. Altogether, 58% of the British online research sample identified at least one environment, such as while on a train/, bus, tube, queuing, or in the home or at work, in which they would be likely to use a free to air mobile TV service.
The potential magnifies among the younger demographic groups, with 80% of 18-24 year olds and 76% of 25-34 year olds suggesting this is a key demographic for mobile TV services.
€24 billion market
With McKinsey Research predicting the mobile television industry in Europe could become a €24 billion market and reach more than 190 million users by 2015, there is a clear opportunity for operators and manufacturers. But in order to make good on this potential, broadcasters must offer more free to air content for mobile phones, and broadcasters, mobile operators, and handset manufacturers must lower their prices to maximise the technology's rate of adoption.
This is particularly true for young people who are not used to paying for data charges or content, who tend to have less disposable income than adults, and may not have expensive smartphone and are generally on pre-pay data plans so rarely benefit from flat rates.
Free to air mobile TV has an inherent advantage; it removes all the barriers to adoption by providing users with access to a service they are already familiar with. The only thing different is the viewing platform. It’s a model that gets consumers used to watching TV on their phone and provides an opportunity to introduce premium services once the usage patterns are established.
Telegent Systems is a fabless CMOS semiconductor company providing high performance, single chip solutions enabling worldwide live, free to air broadcast TV reception in mobile handsets, laptops and netbooks, and other portable devices. http://www.telegentsystems.com/