The ripples are still making their way across the lake in the wake of Cingular Wireless L.L.C.’s surprise announcement that it will offer mobile broadcast TV through Qualcomm Inc.’s MediaFLO USA Inc. network. The nation’s largest wireless carrier somewhat stole the thunder from its European counterparts at last week’s 3GSM World Congress in Barcelona, Spain, when it revealed plans to collaborate with its longtime rival Qualcomm for the nascent mobile TV market.
Many were expecting AT&T Inc.’s Cingular to announce its mobile TV plans soon since Verizon Wireless, the nation’s No. 2 wireless carrier, is gearing up to launch commercial mobile TV services on the MediaFLO network by the end of March.
A stalwart in the GSM community, many expected Cingular-as well as T-Mobile USA Inc., the other major GSM-based carrier in the United States-to offer mobile TV using DVB-H technology from either Crown Castle International Inc.’s Modeo or Aloha Partners’ Hiwire. Much like GSM, DVB-H is a technology standard that traces its roots to Europe and enjoys broad support there.
Meanwhile, CDMA carriers like Verizon Wireless and Sprint Nextel Corp. were expected to go with Qualcomm’s mobile TV offering. With Cingular now on board, MediaFLO has snatched up a majority of the market share for mobile broadcast television in the United States.
“This isn’t competition because it’s a totally new technology that’s specifically for broadcast video to a wireless device, so in that respect the competitive issue is muted, if you will, at least as far as this application goes,” Cingular spokesman Mark Siegel said. “Our whole philosophy-whether it’s with handsets or with content or with modes of access to content-we want to make the widest array of choices
available for people. Not only what they experience, but the way they choose to experience it.”
MediaFLO President Gina Lombardi also downplayed the partnership as nothing new.
“We’ve been working with Cingular/AT&T for several years as they’ve deployed the 3G network of W-CDMA and HSDPA. So this is the likely next step if they want to utilize mobile television,” she said.
Cingular has revealed no details about its planned mobile TV handsets, pricing plans or content. However, Cingular said it would continue offering its customers exclusive content not available through other carriers-a notable comment since Verizon will be using the same MediaFLO network as Cingular.
The lead time to get a handset developed, tested and out to market typically takes six to 12 months, and Cingular is expected to offer devices that incorporate HSDPA capabilities alongside the MediaFLO chip. Aside from Qualcomm, chipset vendor Newport Media also plans to develop chips for the MediaFLO service.
As for choosing MediaFLO over a DVB-H provider, Cingular said it made its decision after thoroughly testing both technologies. It concluded that MediaFLO has the greatest promise to deliver broadcast video to its customers. “We looked at a number of factors and we thought this would serve our customers best,” Siegel added.
It’s yet to be seen what this deal means for Verizon Wireless. Numerous reports indicate that the carrier has an exclusive deal with MediaFLO through September; however, neither company would confirm that. Analysts say Verizon’s exclusive mobile broadcast TV offering will be too short-lived to make any significant impact on its competitors. The carrier didn’t return calls for comment.
DVB-H in the U.S.
The deal also throws concern toward DVB-H providers Modeo and Hiwire. Have they now entered a pitched battle phase where they will be forced to compete for the two remaining tier-one U.S. carriers, Sprint Nextel and T-Mobile USA? Both companies believe there will be room down the road for both MediaFLO and DVB-H to flourish, adding that there may even be an opportunity for hybrid devices that would support both MediaFLO and DVB-H technology.
For their part, both Hiwire and Modeo say they are not interested in battling for market share at this stage of the game; rather, they’re focused on continuing to prove market demand exists.
“At this stage of development we are in a category-creation stage, not a market-share fight. We don’t want to have a battle between us and Modeo and MediaFLO,” Hiwire President and COO Scott Wills said. “I think it’s important to realize that you don’t have to be the first in the marketplace to realize potential.” Wills referenced the early days of cable and satellite television, as well as wireless, where companies that were first to market did not necessarily remain on top.
Modeo chimed in with a similar reaction. “There’s always been many points of retail distribution, wireless operators are one,” Modeo spokesman Blake Lewis said. “When you look at the nascent state of the industry, there’s certainly so many directions it can go in. We’re encouraged by the fact that AT&T has adopted an outsourced multicast solution. It’s yet another point of validation that we’re on the right track.”
In the past, Modeo executives have pointed out that cellphones are not the only devices that could receive mobile TV signals. Laptops, portable gaming devices and even digital music players could potentially expand the market for mobile TV.
MediaFLO was a bit less conciliatory in its remarks. “I don’t really understand their strategies,” Lombardi said of the DVB-H providers. “My strategy is focused on the wireless carrier and that distribution channel. I do know that people in the United States are very passionate about television . and since you bring your mobile phone every place with you, with your keys and your wallet, there could be expansions in other areas that they could endeavor in.”
It’s interesting to note that, while promoting MediaFLO, Qualcomm appears to be hedging its bets by supporting other mobile TV technologies in its chips. Indeed, the company last year introduced a universal mobile TV chip that supports its Forward Link Only (FLO) technology as well as Digital Video Broadcasting-Handheld (DVB-H) and Integrated Services Digital Broadcasting-Terrestrial (ISDB-T). ISDB-T has been touted in Japan for mobile TV broadcasts.
Channel lineup, differentiation
Although the content MediaFLO delivers over its network will be consistent across the board, carriers can pick and choose which content they’d like to incorporate alongside their existing 3G multimedia services. “This is no way supplants or replaces things like Cingular Video or MobiTV; those are still important to us and this complements and supplements, it does not replace those,” Siegel said.
Verizon has announced its initial launch will include programming from CBS, Comedy Central, Fox, MTV, NBC News, NBC Entertainment and Nickelodeon, with more channels to be introduced in the future. “We think that we have the best content providers as partners here and we think that their offerings are going to be pretty compelling to the consumers,” Lombardi said.
MediaFLO also announced that it will launch advanced features in the second half of 2007, after Verizon’s rollout but before Cingular’s service launches. The new features will, among other things, enable carriers to provide their customers with data streams such as stock portfolio numbers or sports scores, delivered quickly to the handset. “We can real-time populate handsets or real-time weather reports or clips of an alert telling you that ‘hey a tornado’s coming or a hurricane’s coming,'” Lombardi said.
“We’re focusing on live (TV) right now because that’s what our consumer research has shared with us,” she said. “On average we see consumers using the MediaFLO service anywhere from 30 to 60 minutes a day, so I mean people are really watching the service.”
Siegel said Cingular is excited about the enhanced prospects. “We want to be very aggressive and remain on the leading edge, but also very, very careful and thoughtful and nuanced in the way we approach this kind of thing so the customer experience is the best it can possibly be. Because what you don’t want to do is disappoint customers.”
As for the remaining tier-one carriers, none has announced plans for mobile broadcast TV. A Sprint Nextel spokeswoman said the carrier completed its trial with MediaFLO in January and has decided to not partner with the mobile TV provider, but might consider doing so in the future. T-Mobile USA is testing mobile TV services from both Qualcomm and DVB-H vendor Hiwire. And soon, Alltel Corp. will be trialing MediaFLO’s service.
