Despite high expectations for mobile TV and radio services, only a small number of broadcasting technology options will be financially viable, according to the report, Evaluating the Options for Mobile TV and Radio Broadcasting in Western Europe, written by Unwired Insight.
As consumer demand for mobile TV and radio increases and broadcasting services begin to emerge during 2006, there will be strong competitive pressures on mobile operators to respond. However, according to report co-author, Dr Alastair Brydon, “There is a strong chance that mobile users will not spend a substantial amount on mobile TV and radio services, or video-on-demand and other mobile broadcasting services.”
Mobile operators in Western Europe are already evaluating several broadcasting technologies, including DAB-IP (Digital Audio Broadcasting – Internet Protocol), T-DMB (Terrestrial Digital Multimedia Broadcasting), DVB-H (Digital Video Broadcasting – Handheld) and TDtv, alongside the option of relying on enhanced 3G networks. If they opt for a dedicated broadcasting technology, they must decide whether to build their own networks or to share the cost and risk with other operators and/or broadcasters.
Financial modelling presented in the report reveals that small operators will have a very limited choice of viable options. According to Alastair Brydon, “Sharing a broadcasting network with a number of other mobile operators will be essential. With a shared network, either DAB-IP or DVB-H could yield attractive returns,” says Alastair Brydon. While DAB-IP is potentially the cheapest solution, it is only appropriate in those few markets where DAB has been deployed extensively. Furthermore, only a limited range of DAB handsets and broadcast channels may be available. DVB-H is currently attracting the most interest from mobile operators in Western Europe and is the most likely to achieve significant economies of scale on both infrastructure and handsets.
Mobile operators with a large customer base have more options than smaller operators. “While a shared DAB-IP or DVB-H network could provide a strong financial return for a large operator, some may want their own broadcasting networks, to differentiate themselves from competitors,” says Dr Mark Heath, report co-author.
Mobile operators wanting to own broadcasting networks have two viable options: building DVB-H networks or upgrading their 3G networks to TDtv. “TDtv would allow mobile operators to reuse existing cellular base stations and operate in already-licensed TDD (Time Division Duplex) spectrum, making it considerably cheaper,” says Mark Heath. “While DVB-H is also viable, operators must try to avoid high spectrum costs and the use of the more expensive L-band spectrum, which would require significantly higher take-up and revenue per service user to achieve a good return.”
Evaluating the Options for Mobile TV and Radio Broadcasting in Western Europe, evaluates the realistic deployment options for each of the mobile broadcasting technologies that are likely to be used in Western Europe. The report identifies the options most likely to be commercially viable for different operator types and circumstances, and quantifies the take-up and revenue per service user needed to achieve an adequate financial return from each.