US Mobile TV Initiative May Point to Opportunity in Emerging Markets

A consortium of television networks announced recently the launch of a free mobile television service in Washington, DC. The “mobile DTV” service, supported by the local CBS, NBC, PBS, Fox and Ion affiliates, will provide free access to local television broadcasts for anyone with a device equipped with a special receiver. Receivers can be built into cell phones, laptops, GPS or other mobile devices, and viewers will not need a data plan or Internet connectivity. Not surprisingly, mobile carriers are unenthusiastic about the new service, preferring to capture revenues from subscription-based, on-demand mobile content through their own networks. Nevertheless, equipment makers like Dell, LG and Samsung are building the DTV receivers into netbooks and handsets in anticipation of wider availability this fall. By year end, broadcasters will expand the service to two dozen other US cities – home to almost 40% of the US population.

Mobile TV could be considered the killer app that hasn’t killed anyone (yet), Early attempts to deliver TV content sputtered due to a poor viewing experience or resistance to high subscription fees, but new technologies and alternative service models such as DTV are gaining momentum thanks to the transition to digital transmissions in both mature and emerging markets. Indeed, Cisco and research firm ABI predict robust growth in mobile data traffic globally, with anticipated viewership jumping to 500 million by 2013.

Dell, LG and Samsung are smart to stay ahead of their rivals on this technology. They can maximize the opportunity by working with market-leading broadcasters in select emerging markets to extend the service to these countries. There is ample evidence that demand for all kinds of mobile content is growing rapidly in key developing countries like India and China, and a free service will have great appeal to cost-conscious consumers. Cisco estimates mobile TV viewers in the Asia-Pacific region (excluding Japan) will exceed viewers in Western Europe or North America within four years. Frequent power outages may also cause developing-country consumers to see a higher perceived value in such a service. Imagine the crowd around the netbook when a blackout interrupts the big cricket match.