Valentine’s day looked more like Christmas yesterday for the mobile phone industry in general and the DVB-H providers in particular with the release of a report from Strategy Analytics that forecast sales revenue for TV-enabled cell phones will soar to over $30B by 2010. The report went on to predict the DVB-H technology will dominate the delivery network claiming 40% of the market by the end of the decade-up from a forecasted 19% in 2006.

Steve Sechrist
Senior Analyst and Editor
of Projection Monthly &
Microdisplay Report

This news was especially pleasing to the likes of Nokia, Motorola, Sony Ericsson and Siemens, all in the DVB-H technology camp. These manufacturers, along with chip suppliers and service providers doing the network build-out, are betting big money on the technology in head-to-head competition for next-generation mobile video services.

DVB-H (Digital Video Broadcast-Handheld), a mobile version of the terrestrial digital TV standard adopted by the EU, is just one of several cell-phone TV enabling technologies. It competes with DMB (Digital Multimedia Broadcast) based primarily in Asia (using the Eureka 147 digital radio broadcasting standard) and proprietary systems like Qualcomm’s MediaFlo, now tied up with Verizon Wireless here in the US.

If regional bias is any indication of technology acceptance, Strategy Analytics said Japan and Korea dominate the TV phone market today and those two countries will claim 80% of the 8M TV phone units forecast to ship in 2006. A shift in the balance is expected to start later this year with 1M units going to Europe, and with the US and China coming on strong in 2007.

EE Times reports that a number of mobile-TV trials based on DVB-H are already under way in many European countries, the United States and Australia. Based on early results, (a) consumers seem to like TV on their mobile handsets and (b) they might like it enough to pay for it. Maybe.

Maybe is right - in a January report on mobile TV services in Germany, Strategy Analytics said both content and network performance received failing grades from consumers on current technology offerings. These included T-Mobile’s Handy TV and Vodafone Live! Mobile TV. Users were unimpressed with the experience delivered by both services, citing sub-optimal network speeds and service reliability. Out of more than 50 test users, more than half experienced network-related problems over three consecutive nights of testing.

While these are preliminary findings, the report went on to say that identifying the types of “premium” content on mobile devices that users are willing to pay for is perhaps the toughest challenge that operators and service providers face.

Since all this growth is predicated on market acceptance of the technology, it may serve the service providers well to look beyond the analysts’ assumptions, which rely on comparing adoption rates with the HDTV market. With the HDTV market, sports programming is driving adoption, and analysts think video streaming of sports feeds is likely to drive sales of high-profit mobile subscription services, too.. Other popular content could be real-time weather and traffic updates. Bottom line, whatever the delivery network becomes, the ultimate success will be driven by network reliability and value-added content that users are willing to pay for. Stay tuned for more developments.