ICO to partner with Alcatel-Lucent on DVB-SH

ICO Global Communications announced it will be launching a $500 million satellite into space April 14th that will eventually provide broadcast mobile TV service nationwide using digital video broadcast-satellite handheld (DVB-SH) technology.
“It is the largest commercial satellite ever lifted into space by (Atlas V booster),” CEO Tim Bryan said at a media event Tuesday afternoon. “We’ve worked for three years; spent $500 million to put this satellite program in space.”
DVB-SH, a variant of DVB-H that relies on satellite for delivery, is largely unproven (only satellite radio can be pointed to as a similar commercially launched service) for mobile TV services. The Craig McCaw-backed company pointed to spectral efficiency as one of the greatest characteristics of the technology, which it plans to first trial in Las Vegas and Raleigh, N.C., around June or July.
“We know DVB-SH is better. We’ve got the real world experience to back it up,” Bryan said.
John Leonard, president of applications and business at Alcatel-Lucent, said trials have produced a spectral efficiency that’s twice as efficient as DVB-H. ICO has signed on with Alcatel-Lucent to provide software that will manage content, the programming guide and interactive components for multiple screens. Its software will work with multiple technologies, “independent of the delivery vehicle, the delivery access for that content,” he said.
It’s also focused on providing an identical experience across all platforms.
“You don’t want the user to re-learn how to search for content, how to access content every time they change a device,” Leonard said. “The way you access content should be consistent” through a “common content management system and a common interactivity management system.”
Both companies are also claiming DVB-SH is more spectrally efficient than MediaFLO however MediaFLO USA Inc. is focused on broadcasting TV to handsets while ICO is going after in-car TV screens and larger portable screens. Bryan said there will be opportunity for the company to extend its offering to cellphones, but didn’t give specifics and the perception he left behind was that it might never happen.
On the programming side, Alcatel-Lucent’s model provides quite a different approach than MediaFLO has crafted with carriers. The Qualcomm Inc. subsidiary does most of the content deals (excluding pairs of exclusive channels recently announced with Verizon Wireless and AT&T Mobility) while Alcatel-Lucent’s approach will let carriers pick and choose their content at will.
Moreover, Leonard argued that MediaFLO leaves less room for innovative business models to emerge. “MediaFLO is a pre-defined business model in the way it operates,” he said.
Indeed, he believes business models will determine whether mobile TV will stay afloat (and grow) or sink into an abyss. “What we need to define as an industry is a business model,” he added. “Until we get that right obviously we’ll be a relatively small base of users.”
Beyond business models, ICO’s Bryan said nationwide coverage will have to be in place for any mobile TV provider to stick.
“Competition and services in the video field are highly prized,” he said.
Following both companies presentations, a financial analyst asked the executives to explain how the venture is more than a research and development project that was “mouse-trapped.”
“This is not an experiment. This is a product. This is a solution,” Leonard said. “It’s going to take time for the market to develop.”
Bryan concluded by saying the addressable market is at least as great as satellite radio services in the U.S., which has surpassed 17 million subscribers thus far.
“We see the size of that market being at least that size, many millions of customers,” he said.