Commentary

Mobile TV: Consumers Shaking Heads Over Monthly Fees

by Wayne Friedman , Staff Writer, March 11, 2009

The eternal optimism of execs in the mobile TV category continues -- even when consumers are drawing a different picture.

Mobile carriers have been making their retail consumer plans simpler for some time. Now comes a moment when this activity should be carrying over to that promising new area of mobile TV.

But paying $10, $14, or $20 a month for the likes of a MediaFlo or MobiTV won't cut it in the near term -- not with this economy still in the claws of a recession. According to virtually all surveys, consumers want their mobile phone service, and all that goes with it -- like TV/video applications -- free, or at least included in that one monthly bill.

All the more reason why TV stations are doing cartwheels over the progress they have made with their Open Mobile Video Coalition. Should stations be able to send digital signals directly to a large number of mobile users, they'll put some pressure on mobile carriers -- and perhaps other digital media platforms.

Mobile carriers at least know the score when it comes to content providers. One executive at AT&T has already been talking up advertising-revenue sharing deals, where AT&T would get a piece (10%, 15%?) of advertising revenues TV stations grab from marketers. That would keep costs down.

All this might work, except for one thing: The mobile TV ad market isn't ready yet. Currently mobile TV aggregators may have a tiny, perceived shift in sentiment on their sides -- at least among some content providers.
Time Warner, for example, wants to start a monthly-fee, cable-operator-like TV service on the Internet called, TV Everywhere for those who can't get to a cable/satellite TV distributor. Cablevision Systems Corp wants to start charging its Long Island, N.Y.-based readers of Newsday for accessing that newspaper online.

Consumers may think otherwise, especially since they've been bombarded with messages that with the Internet you can get everything pretty much for free.

Or, if not free, then cheaper -- especially in what is expected to be a slower-moving economy, after the recession has completed its run

3 comments about "Mobile TV: Consumers Shaking Heads Over Monthly Fees".

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John Murawski, March 11, 2009 at 1:04 p.m.
Mobile TV makes video content more of a commodity now than ever before. When you add mobile device distribution to web, satellite and free to air, and it's no wonder cable ops continue to insist that paying for a ubiquitoius service is a broken model. While the distribution companies are still trying to figure out the Mobile TV business model, I'm not sure consumers will embrace it if they see it as one more thing that simply nickel and dimes them to death. Verizon & AT&T have a great opportunity to sieze an avantage the cable operators are still struggling with by providing mobile video as a value add to mobile phone customers that bundle cell service with their multichannel video service in the home. In this economy it's all about added value.
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Allen Mostow from SynergySystems - TVInCars LLC - Int'l Mgt Consultants, March 12, 2009 at 3 a.m.

Small hand held portable TV's have always been somewhat of a novelty and all but ignored by broadcasters in the past. You have to target a valuable demographic (drivers of motor vehicles) with a new, free, delivery channel (real time Broadcast TV audio). Drivers Don't Watch!!! All other delivery systems of mobile hand held TV can be used and recharged in this environment as well. It's inevitably about 'mindshare' so conditioning commuters to "click to hear" the shows they're watching as they leave each morning, it maintains their focus and involvement with each day's OTA TV infotainment offerings. www.HearTVInCars.com

Bill Ganon from Connect2Sell , March 12, 2009 at 6:29 p.m.

As mobile providers consider reducing the sub revenue stream, they must look to other areas for revenue success. Premium programming is certainly one, and of course, no Mobile TV discussion can be complete without reference to advertising revenue
Much has been written about the Catch 22 of mobile advertising - you can't get meaningful reach (audience), without dropping fees, but you can't sell advertising in a meaningful way without an audience.
Rather than wring hands over this cul-de-sac conversation, I suggest that mobile advertising can and will be effectively sold - - but not as long as the old TV paradigm is in place. SPecifically :30 and :15 spots (and some :10s but ask any agency or marketer, and they'll tell you there is a scarcity of these units).
It will be effectively sold when the whole proposition for ad units becomes mobile centric. Ads shot with mobile form factors in mind, and advertising features that both take advantage of the technology options that are mulitiplying daily: clickable video ads, LBS, mobile coupons, scrolling text and more.
By definition there will be fewer ad spots so the the traditional 16 minutes/hr. must be totally ignored.
Instead, it is up to operators, content providers, and broadcasters to fundamentally reset the table with rates that are not cut/paste from TV, but an entirely discreet but defensible value proposition.
Problem is, there are still too many legacy hooks in the system and traditional revenue streams from b/cast and cable still dwarf mobile revenues.
Still, there has to be a beginning to this change and while it requires some coordination on the selling side - -I believer there are plenty of savvy, marketers willing to buy up this beachfront real estate.
Am I dreaming here? Marketers?