Mobile TV and video may be a future killer application, but how will it be delivered?

By Dr Mark Heath - Sound Partners Research
www.wireless-reports.com
 

TV is a powerful force in the consumer market, as demonstrated by its almost ubiquitous presence in households and by levels of usage that are orders of magnitude higher than for mobile phones. As mobile operators attempt to identify compelling services beyond voice telephony, mobile TV and video services may be a big part of their future success.

However, there are major questions on how these services will be delivered. What can 3G support? Will broadcasting technologies be necessary? With the emergence of a complex range of technology options, such as DVB-H, DMB, MBMS and MediaFLO, which one(s) will win?

Mobile TV could be a killer application for 3G

TV is a powerful force in the consumer market, which mobile operators can harness to drive growth in 3G handsets and services. Figure 1 shows how much greater TV usage is than mobile phone use (in terms of duration); in the UK, for example, TV use is nearly 50 times greater than mobile phone use. Even in the USA, where mobile phone usage is significantly higher than in Western Europe, TV usage is over 12 times greater than mobile phone usage.

Figure 1: Comparison of time spent using TV, radio, home Internet and mobile phone services per person per day in the USA and the UK

In South Korea, strong TV and video services have driven the fastest 3G take-up in the world. Japan and South Korea were the first markets in which 3G services were launched, but experienced very different levels of take-up. It took nearly three years for 3G to represent 12% of NTT DoCoMo's customer base in Japan. A significant factor is this slow initial take-up was the inability to differentiate its 3G consumer service from its highly successful 2.5G i-mode service. In comparison, South Korea has seen very strong 3G take-up, due largely to a sharp focus on new TV and video services, backed by strong marketing and aggressive pricing to make the service relatively affordable. Launched more than a year later than Japanese 3G services, SK Telecom's 3G service was adopted by 29% of its customers within two years.

Basic 3G networks allow mobile operators to deliver mobile TV and video services, using existing spectrum, networks and handsets, to existing customers, and is likely to be the dominant solution for at least the next three years. With the success seen in South Korea, and the need for mobile operators to drive new data revenues beyond voice, many mobile operators are already pursuing the mobile TV opportunity. They are adopting diverse approaches to service content and format, pricing and marketing.

Conventional delivery of video may consume substantial 3G network traffic

With under-utilised 3G networks, several mobile operators are offering streamed TV and video content at highly attractive prices. However, compared to many other mobile services, conventional 3G delivery of TV and video services can consume substantial bandwidth, even with relatively low usage levels, as shown in Figure 2.

Figure 2. Comparison of downlink data consumption of TV and video services with voice telephony and other mobile data services

Mobile operators need to take extreme care to manage the usage and pricing of mobile TV and video services. For example, just five minutes per day of TV and video viewing (less than 3% of typical conventional TV viewing) streamed at 128kbit/s would consume the same downlink network traffic as 2000 minutes of voice telephony per month. In the short term, the small number of users and substantial unused capacity of 3G networks will allow operators to stimulate heavy usage of video services at affordable prices. However, if these services prove to be popular, 3G networks could become swamped. For example, severe network congestion arose from the initial promotions of 3G services in South Korea, which offered unlimited usage of TV and video-on-demand services. W-CDMA networks could become inundated as soon as 2007, as users migrate to 3G.

Furthermore, heavy usage of affordably priced video services (e.g. services provided for a fixed monthly fee) could harm service profitability, causing the revenue per Mbyte achieved by operators to fall to 10% of its current levels.  Figure 3, which shows revenue per Mbyte for a range of usage levels and monthly prices, demonstrates that a small increase in average daily usage of video services can cause a severe decline in revenue per Mbyte. Some operators may choose to control usage by offering relatively limited video content, such as short video clips, rather than streaming TV, but the appeal of such services may be limited.

Figure 3: Effect of daily TV and video usage and monthly pricing on revenue per Mbyte for a 3G mobile TV service

For those operators that choose to put mobile TV and video at the heart of their 3G portfolios, broadcasting technology will be essential to support the full range of usage scenarios, such as extended viewing periods and simultaneous viewing of high-profile events by large numbers of users.

Mobile operators face a multitude of broadcasting technology options, but 3G itself may have the best broadcasting solution

Mobile operators face a puzzling array of broadcasting technology options. Each broadcasting technology has its own strengths, weaknesses and challenges, and mobile operators need to assess the broadcasting technology against a number of criteria.

The main broadcasting options in Western Europe and the USA are:

• DVB-H, an emerging European standard for providing digital TV reception to mobile devices

• DMB - a development of the well-established DAB standard that can offer mobile TV based on existing DAB broadcasting infrastructure

• MediaFLO - a proprietary technology developed by Qualcomm, targeted at mobile operators.

While most discussion of mobile broadcasting technology revolves around these technologies, all have a number of disadvantages for mobile operators, including lack of licensed spectrum, the massive cost of building a new network and a potential loss of control of mobile TV services. For example, in the UK, the industry regulator Ofcom has indicated that spectrum may not be available for DVB-H before 2012.

In the short term, 3G itself could provide the most attractive broadcasting solution for mobile operators, using the little known 3G MBMS standard, which could be available from 2007. MBMS uses relatively small changes to the underlying 3G standard to enable broadcasting to any number of MBMS-capable handsets within a 3G network. Rather than establishing a dedicated, point-to-point connection to every handset, MBMS requires just a single broadcast channel in each cell. This can have a substantial impact on network capacity, as illustrated in Figure 4, which shows the network capacity consumed by a potential 3G service mix, including TV and video, with and without MBMS.

Figure 4. 3G network capacity consumption, with and without MBMS video broadcasting channel, in 2010

A major benefit of MBMS is that it is built into an existing 3G network and achieves the same level of coverage without additional spectrum, licensing or base station construction. However, MBMS does require operators to set aside capacity that could otherwise be used for conventional voice or data services. Hence it can only be justified if mobile operators can attract mainstream audiences to each MBMS broadcasting channel. Some operators may consider deploying IMT-2000 extension band spectrum (when this is licensed) to support MBMS channels. A further benefit of MBMS is that it could give mobile operators stronger control of the mobile TV and video market than alternatives, such as DVB-H, which are likely to be more heavily influenced by broadcasters.

As mobile operators try to define the role of 3G and other alternative technologies, their future technology evolution plans may be more strongly guided by the requirements of mobile TV and video that perhaps any other service.

This article is based on a new report from Sound Partners Research, Making a Success of Mobile TV and Video published by Analysys. Click here for more information.