Original URL: http://www.theregister.co.uk/2006/07/06/mobile_tv_wars/
Wanna know how to win the mobile TV war?
Open standards and competition, Nokia says
Comment The Nokia representatives at the World Cup media gathering called this week by Texas Instruments, wanted us to take one thing away, that the mobile TV market will be won by open standards and a competitive eco-system.
The meeting was called to use the German co-operatively built DVB-H mobile TV system as a show piece for the technology, but also as a showpiece for the model that its suppliers hope will influence the rest of Europe.
We know that Nokia wanted us to take that message away because throughout the evening Harri Mannisto, director of the Nokia multimedia division that controls mobile TV offerings, said as much as something like 20 times.
Open standards, unlike other offerings in the mobile TV space, would create competition, and competition would create a novel and innovative market place.
The fight is still going on to preserve DVB-H as the centre of all things. Mobile TV, and Nokia, with its partner Texas Instruments is still waging war on the likes of arch-rival Qualcomm with its MediaFLO, and on T-DMB, hailing mostly out of Korea.
"This is the first country where this model has been seen," said Mannisto, calling what had happened in Germany a 5:5:2 model. The reference was clearly analogous to the football World Cup where the popular 4:4:2 formation is most often used.
"In Vodafone, O2, TMobile, E-Plus and KPN we have five operators. There are five terminal vendors (of which we are one)," he added, but declined mentioning all the others, "and two system vendors".
The point was the same point. All of these companies can work together with a single standard, each proving their interoperability which means that as the market goes forward, price advances and innovation go straight into the market. The market is not held back by the lack of imagination of a single vendor.
Given that T-DMB is also recognised as a European ETSI standard, presumably this same approach could apply to T-DMB, and most of the barbs in these comments were reserved almost entirely for Qualcomm.
It is remarkable how on message the Nokia guys are about Qualcomm these days, almost as if it were the "new" enemy. So if one former CEO, Jorma Ollila always pinpointed Microsoft as the "danger" during his tenure, then perhaps Olli-Pekka Kallasvuo has expanded the enemy camp to include Qualcomm.
In his summing up as he announced the ending of the deal with Sanyo last week to make CDMA phones, Olli-Pekka Kallasvuo said one reason was the fact that the CDMA customers are a declining force and that this market was no longer to be considered a growth market, and that was the exact message that the Nokia representatives here carried with them.
So does that mean that Nokia and the Mobile DTV Alliance, the US club formed as a kind of US anti-Qualcomm mobile TV initiative a few months ago, have given up on Verizon. Is it a CDMA haven that Qualcomm can just dominate at its will?
"We have given up on nothing in the US market," says Mannisto, "but the US market is a very strange one, and we expect DVB-H to be side by side in the US market."
An analyst from Informa had said much the same thing minutes earlier, the US to be split into two between the standard and non-standard worlds of DVB-H and MediaFLO.
It is a common perception.
But Crown Castle in the US, the only member of the Mobile DTV alliance that is in any danger of having a genuine DVB-H network, is miles behind its planned roll-out. It had hoped to name its mobile operator partners by the end of 2005 and here in the second half of 2006 it has still to name one.
What is stopping Cingular from throwing in its lot with Crown Castle's Modeo, which it turns out has only built out the trial site in Pittsburgh and one new market in New York, and has yet to unleash its DVB-H service on the 30 markets that it promised this year?
The answer lies, we suspect, in the spectrum that Modeo has adopted, the 1.67 GHz slice that is perfectly feasible for putting up a DVB-H service, but which has some distinct disadvantages. It propagates not half as well as the 716 MHz to 722 MHz UHF spectrum that Qualcomm owns, and there are almost no DVB-H trials around the world in that spectrum.
The bulk markets are eventually all expected to be in existing VHF, UHF and L-Band plus the big digital dividend that will be released when Europe and the US analog TV vacates the bulk of the UHF spectrum. For the US this is in April 2009, for the bulk of Europe there are varying dates between now and 2012.
But recent self proclaimed DVB-H market entry Aloha and Partners, working with SES Americom, which have between them formed Hi-Wire, in neighboring 700 MHz range to MediaFLO, are probably much more to the liking of both the Mobile DTV Alliance, and to operators like Cingular, who don't want to be hobbled by a network that builds out more slowly and has bigger network costs associated with it.
A conspiracy theory was doing the rounds at this German event that Cingular is holding all the DVB-H players to ransom, trying to force Modeo to vacate its own 1.67 MHz spectrum and throw its lot in with HiWire. This is fuelled not least by the fact that no one present truly believes that HiWire is in the business of building out its own network.
Aloha was formed to be a spectrum trader and has never before considered entering the operator business. Aloha Partners was set up, with the backing of several investors with backgrounds in telecoms infrastructure, to acquire the initial tranche of 700MHz spectrum auctioned in the US. It gained 12MHz of spectrum, double the amount bought by the other auction winner, Qualcomm.
Using DVB-H this could be used to offer something like 25 to 32 TV channels with plenty of room left over for audio and clipcasting, and would make a formidable opponent for Qualcomm in its own backyard. And such a transaction could probably be funded by the reduction in cost of a network build in the US, perhaps a gain several hundred million dollars, using this spectrum rather than 1.67 GHz.
One thing this would allow, and we have said this in the past, is that Verizon could work with both Qualcomm and with DVB-H, on the same handsets, with slightly different software. That way Verizon could back ALL the horses in the race at once, and be sure to be riding a winner.
Such a position would be sure to hurry Cingular into signing up its own "exclusive" deal with DVB-H providers, to ensure that such a Verizon eventuality did not occur.
MediFLO, being a system from a single vendor Qualcomm, means that it has more leverage in getting a deal cut with customers like Verizon. It can fund the deal out of next generation CDMA price reductions for Verizon, but this kind of loyalty can only last as long as any given network upgrade lasts. Similarly, Nokia or others might offer the same to WCDMA networks.
So this is the kind of politics that the Mobile DTV Alliance is up against and its messianic mission of "open standards" and a competitive eco-system may well work on in the long run, but it carries little weight if it cannot affect "this quarters numbers" when applied to a major US cellco.
For the meantime the DVB-H camp will content itself with keeping MediaFLO outside of Europe. But surely it is already here, with the trial that BSkyB is running in the UK?
"Yes but BSkyB is trialing more than one technology and it's not made its technology choice yet and we don’t think it will choose MedaiFLO," said one attendee at the conference that preferred to remain nameless.
So, apparently, the MDTV Alliance is parlaying with BSkyB and dragging it around on similar jaunts to DVB-H sites, and still hopes to pull that one out of the bag. BSkyB is almost certain to be a bidder in the UK Ofcom auction for 1.4 GHz spectrum coming next April where a full 40 MHz is up for grabs.
But at the meeting there was some news of sorts that shows the strengthening hand of the Mobile DTV Alliance, and present to announce seven new members was the Texas Instruments employed chairman of the Alliance, Yoram Solomon.
These are made up of six new contributor members, Freescale, Harris, Mediaphy, MobiTV, Philips and Silicon and Software Systems (S3). LSI Logic has also joined at the Associate Level.
There's growing weight here. Freescale virtually missed the DVB-H boat, but has partnerships with Frontier, Philips of course has its own DVB-H solution, Harris is agnostic about transmitter technology and the various mobile TV protocols, while MobiTV wants to make the step up from Java applets for unicast video and acting as a content aggregator, to the main show. MobiTV has already made friends with IP Wireless which offers TDtv, a Time Division Duplexing version of the MBMS multicasting protocol.
MBMS was taboo at this event and barely mentioned, but the truth is that most of the bigger European operators are not investing as such in DVB-H, only partnering with broadcasters and handset makers that are. They want to keep their powder dry for the year or so that it will take for MBMS to come to the fore and offer them a viable alternative to DVB-H and other datacasting services. That would be an option that the operators can own lock stock and barrel, and which won'’t need investment in new spectrum.
So MobiTV has at least spread itself to cover all mobile TV eventualities, and it is quite likely that Texas Instruments has done the same.
There is less religious fervor about TI than about Nokia. Nokia has a lot riding on DVB-H and has part pioneered it, TI's Hollywood chip already supports DVB-H and Japan's ISDB-T, but TI was at pains to point out that it would be just a software change for the chip to support other protocols.
When asked about supported the Qualcomm MediaFLO one TI spokesman went white, but still mentioned it as a remote possibility, if it ever it totally dominated the market. We're pretty sure he turned around and said "Over my dead body," to himself afterwards, but he wanted us to know that TI designs are that flexible.
S3 was present at the event and with Packet Video, provided all of the demonstration software implementations, with Packet Video offering handset decoding and S3 writing the ESG (electronic services guide) and middleware. Irish S3 like MobiTV, is non-religious and is everybody's friend and has a foot in almost every mobile TV camp.
But despite the Mobile DTV Alliance show of what is a strengthening force, and it says it will shortly move to certification and interoperability testing, it still has no operator backed DVB-H service in the US, and it is no clearer to having a coherent business model than it was when it was launched.
Mobile TV watchers know that although Korea was first to market with mobile TV, that it has almost stalled over the lack of consensus over a business model, with T-DMB a free to air advertising driven service, mandated as such by the Korean regulator, and the earlier and far more successful S-DMB able to offer a paid subscription service.
But here in Europe, with people already watching the world soccer cup on Mobile DVB-H TV, will this same dichotomy of business models harm the eco-system?
"We see the advertising side more as program sponsorship," TI"s Solomon said. "That's what we are hearing anyway."
"The German system is based on a shared broadcast operator and a shared network," says Nokia's Mannisto. "And that allows all of the channel providers to offer their own business models," and he repeats his mantra about open standards and a competitive eco-system (that was about the tenth time).
"We know that the rest of Europe is watching very carefully how the German experiment works (It's 5:5:2 formation) and we believe that many European countries will adopt this same approach."
But the truth is that Qualcomm is beset by the same difficulties and has come up with the same solution, it will build its MediaFLO network in the US and let its operators decide on their business model, so here DVB-H is offering no real advantage.
The discussion then drifted to how mobile TV devices would be used and where and what form of content would be best suited to it. The entire discussion is really down to whether or not shortened specialised "mobisode" content is the way forward, or will people watch longer programming. Nokia research shows that in DVB-H trials people watch both including longer form content, but privately all of the speakers agreed that the way forward is by bringing Digital Video Recorders to the phone, and Nokia showed off its N92 Multimedia device with DVB-H which has 2GB of flash swappable memory.
Where are the hard disks? "The N91 had a 5 GB hard drive, but that's too big to fit into this device. But we have many DVB-H devices coming out soon, and some are sure to have hard drives in them," confesses Mannisto, confirming the idea that the phone will become a place to "carry" video content as much as to view it, an opinion first voiced by TI at 3GSM this year.
By placing enough storage and a DVR application into the mix, it means that mobile TV users will be able to watch an episode of 24, throughout the day, snacking on 10 minutes at a time, which begs the question about business model.
The broadcasting industry and its advertising partners have already been sent into retreat through the invention of the DVR in set tops and big TV, and no advertiser will make a huge commitment to mobile TV if most of the devices can fast forward through their adverts. So program sponsorship and paid subscriptions does seem most likely.
One of the notions that has dogged the World Cup DVB-H coverage has been the quality of the picture, and we can testify that the semi-final between Germany and Italy, although watchable on the N92, was far from perfect and far from the quality that we know DVB-H can achieve.
"That's a question for T-Systems and how it has implemented DVBH here," said Solomon.
But we found that this demonstration system set up in haste for the World Cup had just a single transmitter per city and some suggested that it was using 16QAM rather than QPSK as a modulation. It was still a street better than unicast TV on a mobile, but there are some miles to go before mobile TV works to the same standards everywhere.
TI also took the opportunity to show a T-Mobile branded mini DLP projector, battery driven that projected a DVB-H image the size of a TV on a nearby wall, with really quite stunning visual quality.
"We hope that within one generation we will be able to put this inside a phone, and make it one integrated device," said TI, and of the 50 or so media and analyst members present, more time was spent poring over the single projector than the 10 or so N92s that were on hand.
"Remember," summarised Nokia's Mannisto, "this technology delivers 6GB in an hour to what could be 2bn people. With open standards and a competitive eco-system there are hundreds of ways that data delivery resource can be harnessed.”
Copyright © 2006, Faultline
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