Technology | Media | Telecommunications

Saturday, September 26, 2009

Mobile TV Needs a Viable Business Model


Are U.S. consumers really interested in watching television on a mobile device? eMarketer reports that according to data from Mediamark Research & Intelligence (MRI), more than one-fifth of U.S. mobile phone or PDA users are interested in watching live TV on their mobile device.

However, the overall market study results are very mixed and inconclusive.

Respondents to the research firm's latest market study were even more likely to be interested in watching mobile TV if they indicated that they viewed their mobile device as a source of entertainment -- 46.9 percent of such consumers said so.

When it came to paying for mobile TV services, however, consumers were markedly less enthusiastic. Only 13.5 percent of all respondents said they would pay a subscription fee for mobile TV, and even among respondents who said mobile was a source of entertainment, the figure was just 34.5 percent.

In addition, more than 70 percent of respondents found ads on mobile phones and PDAs annoying, though some were willing to view them in exchange for lower monthly costs.

The report from Infonetics Research predicts 397 million mobile video phones will be sold worldwide in 2013. But the research firm is likewise not optimistic about adoption of pay-TV services.

"A combination of poor macroeconomic conditions, sub par 3G network coverage for streamed video services, and pricing that puts mobile video services out of reach for many consumers is contributing to the lackluster growth of mobile video services around the world," said Jeff Heynen, directing analyst at Infonetics Research.

"While mobile video services are expected to eventually grow significantly, until operators can combine broadcast, on-demand, and side-loading, revenue will remain a drop in the bucket of overall mobile service revenue."

Pyramid Research put paid mobile video subscribers at just 2.5 percent of total mobile subscribers worldwide in 2008. That figure is expected to increase to 8.5 percent by 2014.

Given the time and effort already expended in promoting these offerings, this is clearly an underachieving mobile service business model.