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Unicasts to Mobile Phones are Not Scalable

Mobile broadcasting -- as opposed to streaming "unicast" services -- is expected to rapidly become the model of choice for distribution of live television and movies to mobile devices in the United States. Moreover, U.S. service providers continue to offer pricing that only attracts the most enthusiastic early-adopters.

By the end of 2007 approximately four million subscribers will receive entertainment and information on their wireless handsets via mobile broadcast technologies such as DVB-H and MediaFLO.

Senior analyst Ken Hyers reports that recent conversations with major carriers confirmed what ABI Research expected: "The presence of as few as five users simultaneously receiving unicast content from a single cellular base station carrier band can seriously degrade data access for those subscribers. This is further confirmation that broadcast is the only way to get mass market uptake of these services. Already, the market is bearing out that broadcast is the essential method for offering these services."

A recent ABI Research study, "Broadcast and Unicast Mobile TV Services" forecasts that in 2011, mobile TV services will have some 514 million subscribers worldwide. Of that total, the research indicates, 460 million will be subscribers to broadcast services. Broadcast services will have 1.5 million subscribers by the end of 2006. In the US market, most subscribers will be enabled by the wireless carriers' broadcast network partners, including MediaFLO (a subsidiary of Qualcomm), Aloha's Hiwire network, and Crown Castle's Modeo service.

Though ABI Research believes that these services will debut for a $10 a month subscription fee, advertising will become an increasingly important source of revenue for mobile broadcast video, and will serve to subsidize high-quality programming. Also, the marketing strategy appears to follow the typical scarcity model: initially price the service high, and when slow adoption has reached zero-growth, then implement plan 'B' in the hope of stimulating demand.

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