Mobile Television: Challenges of advanced service design


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Mobile Television: Challenges of advanced service design

  1. 1. Mobile Television Challenges of advanced service design LA Global Mobility Roundtable Marina del Rey, CA, June 1, 2007 Johannes M. Bauer, Im Sook Ha, Dan Saugstrup
  2. 2. Overview Lessons and outlook DMB in South Korea Factors shaping market evolution Platforms and solutions Value net of mobile TV
  3. 3. Value net of mobile TV <ul><li>Value-chain of mobile voice services </li></ul><ul><ul><li>Few players (equipment manufacturers, network operators, service providers) </li></ul></ul><ul><ul><li>Standardization sufficient to coordinate </li></ul></ul><ul><li>Value-net of mobile TV services </li></ul><ul><ul><li>Larger number of players </li></ul></ul><ul><ul><ul><li>Mobile operators </li></ul></ul></ul><ul><ul><ul><li>Content providers </li></ul></ul></ul><ul><ul><ul><li>Service providers </li></ul></ul></ul><ul><ul><ul><li>Application providers </li></ul></ul></ul><ul><ul><ul><li>Broadcast companies </li></ul></ul></ul><ul><ul><ul><li>Network operators (mobile and broadcast) </li></ul></ul></ul><ul><ul><ul><li>Equipment manufactures </li></ul></ul></ul><ul><ul><li>Challenges of coordination and service integration </li></ul></ul>
  4. 4. Platforms and solutions Media Forward Link Only (MediaFLO) Satellite Digital Media Broadcasting (S-DMB) Additional broadcast frequency needed (T-DMB: 170-230 MHz, 470-862 MHz, 1.452-1.492 GHz); new handsets; investment in broadcast infrastructure; increased coordination needs between players Terrestrial Digital Media Broadcasting (T-DMB) Out-of-band User-driven and user-configured solution, 2.5G, 3G, WiFi Sling Media Either Multicast, existing handsets usable, higher efficiency of bandwidth use Multimedia Broadcast Multicast Services (MBMS) Unicast, existing handsets usable, opportunity costs of bandwidth Digital Video Broadcasting Handheld (DVB-H) In-band Features Platform/Solution
  5. 5. Status of deployment U.S. (Verizon, 2007) MediaFLO South Korea (TU Media, 2005) S-DMB South Korea (six providers, 2005, limited coverage), Germany (Mobiles Fernsehen Deutschland, 2006) T-BMB Out-of-band 10 countries, including U.S., Canada, Brazil Sling Media Either Not yet commercially deployed MBMS Italy (3 Italia, TIM, Mediaset, Vodafone, all 2006), Finland (Digita/Nokia, 2006), U.S. (Modeo, HiWire Mobile TV, planned for 2007), Germany (planned for 2008), Spain, France (planned) DVB-H In-band Deployment Platform/Solution
  6. 6. Factors shaping market evolution Technology Spectral efficiency Propagation Bandwidth Policy Spectrum policy Market design Industrial policy Economics Cost/risk/profit Supplier strategy Demand Socio-cultural framework Mobile sector Performance/ evolution
  7. 7. South Korean DMB infrastructure The satellite ‘Han-Byul’ DMB Broadcasting Station S-band Gap filler S-band 2.630~2.655GHz Ku-band 12.214~12.239GHz Ku-band 13.824~13.883GHz Transmission tower VHF Ch7~Ch13 (174~216MHz) S-DMB T-DMB
  8. 8. Technology issues of mobile TV <ul><li>When making technology adoption, policy makers considered business as well as technology </li></ul><ul><ul><li>Influencing criteria such as the cost effectiveness of the infrastructure, equipment, and standards </li></ul></ul><ul><ul><li>Closely linked to and co-evolved with technology and firm strategies </li></ul></ul>Gap filler - To cover areas not reached by the S-DMB or T-DMB signals, a gap filler system of repeaters is used. Equipment <ul><li>System A (Eureka 147 standard) </li></ul><ul><li>Backward compatible </li></ul><ul><li>Allowing use of the DAB </li></ul><ul><li>(Stable and Mature technology) </li></ul><ul><li>System E </li></ul><ul><li>Uses CDM, similar to the CDMA technology </li></ul><ul><li>( Korea : competitive advantage) </li></ul>Standardization VHF band III , L-band (1-2GHz) - Multiplexed T-DMB uses only 1.5-1.7 MHz making it easier to accommodate than the 6-8MHz needed by DVB-H T-DMB Ku band (12-13GHz) , S-band (2.630-2.655) - As power output is not limited by international regulations, the S-band is well-suited for broadcasting to small handset antennas Frequency S-DMB
  9. 9. Policy toward mobile TV (1) <ul><li>Licensing Policy </li></ul><ul><li>Korean Broadcasting Commission KBC adopted RFP (Request for Proposal) for provider selection </li></ul><ul><li>For T-DMB in Korea, there are three T-DMB service providers (KBS, MBC, SBS) and three non-terrestrial service providers (CBS, YTN DMB, KMMB) </li></ul><ul><li>TU Media took a license as the first S-DMB service provider (in Dec. 2004) </li></ul><ul><ul><li>Before licensing, TU Media had already invested substantial capital in launching a satellite ($97 million), the installation of gap fillers ($230 million) and the establishment if a DMB broadcasting center($ 60million) </li></ul></ul><ul><ul><li>The circumstances of policy in which government should support to DMB service were created </li></ul></ul><ul><ul><li> Korean DMB was developed by a leading mobile provider’s technology-push to market rather than by market-pull </li></ul></ul>Source : MIC Commercial service May 2005 Commercial service Dec 2005 Service provider selected (1 provider) Dec 2004 Service provider selected (6 providers) Mar 2005 Call service provider application Nov 2004 End of application acceptance period Feb 2005 Launching of the satellite for S-DMB service Mar 2004 Call for service provider application Jan 2005 Description Date Description Date S-DMB T-DMB
  10. 10. Policy toward mobile TV (2) <ul><li>Retransmission of terrestrial TV programs via S-DMB </li></ul><ul><li>S-DMB provider has insisted on retransmission (consumer needs, fair competition with T-DMB, …) </li></ul><ul><li>KBC left the issue to contractual agreements between providers </li></ul><ul><li>Terrestrial TV broadcasters have not signed retransmission contracts </li></ul><ul><li>At least initially, advertising revenues would be too fragile and volatile to cover the costs of gap fillers and other start-up expenses </li></ul><ul><li>Users wanted to maintain T-DMB as a free service, also VHF channels are regarded as a public asset </li></ul><ul><li>Up until now, KBC has had difficulties in finding solutions to the T-DMB cost problem </li></ul><ul><li>Pay service to T-DMB </li></ul><ul><li>The profit structure of the industry could be changed according to </li></ul><ul><li>how policies for competition are designed </li></ul>
  11. 11. Business aspects of mobile TV <ul><li>Business issues </li></ul>Public Policy regime Technology development <ul><li>Competition in business environment will change due to future technology development and </li></ul><ul><li>public policy regime </li></ul><ul><ul><li>T-DMB: pricing policy (Free rate  Monthly flat fee, per channel fees, or charges for specific contents) </li></ul></ul><ul><ul><li>S-DMB: Public policy (Contents  Allowing retransmission of terrestrial TV programs) </li></ul></ul>Regional coverage  Nationwide ( 08, 2007) Nationwide Coverage A lower number of channels A higher number of channels Channels Free $13/month Rate Demand (Consumer perspective) Supply Business aspects As T-DMB will mainly have to invest in a gap filler infrastructure, its costs are lower $ 50-80 million T-DMB $500-800 million Cost structure S-DMB
  12. 12. The Korean experience <ul><li>In addition to high initial cost, market demand has fallen short of expectations </li></ul><ul><ul><li>At the end of 2006, S-DMB reached an estimated one million subscribers. But due to initial investment cost and high fixed cost still loss-making </li></ul></ul><ul><ul><li>Below 50% of short-term break-even goals of 2.2 million subscribers </li></ul></ul><ul><li>Optimistic predictions </li></ul><ul><ul><li>6.6 million S-DMB subscribers by 2010 (TU Media) </li></ul></ul><ul><ul><li>10 million T-DMB subscribers by 2010 (ETRI) </li></ul></ul><ul><ul><li>However, there are many issues awaiting solution </li></ul></ul><ul><li>Policy issues and conflicts waiting to be addressed by government </li></ul><ul><ul><li>Pay service for T-DMB </li></ul></ul><ul><ul><li>Retransmission for S-DMB </li></ul></ul><ul><ul><li>These issues will be repeated when Korea introduces other convergence services, already visible in IPTV and Wibro </li></ul></ul><ul><ul><li>Solutions to these issues could lead to major changes to DMB business environment in the future </li></ul></ul>
  13. 13. Lessons and outlook <ul><li>Important technical and economic differences between platforms/solutions </li></ul><ul><li>Factors shaping market evolution </li></ul><ul><ul><li>Frequency allocations (in-band, out-of-band) </li></ul></ul><ul><ul><li>Eligibility for a mobile TV license </li></ul></ul><ul><ul><li>Rules governing competition among providers </li></ul></ul><ul><ul><li>Revenue model (pay, ad-financed, hybrids) </li></ul></ul><ul><ul><li>Ability of providers to bundle with other services </li></ul></ul><ul><ul><li>Competition by substitute services (e.g. vodcasting) </li></ul></ul><ul><li>Policy and market rules should eliminate bottlenecks and facilitate experimentation </li></ul>