Video to the mobile phone

Video to the mobile phone has been tried for a number of years now.

That is broadcast TV, download, streaming or on demand with mixed technical success and largely commercial failure for one reason or another.

Products and services have to fulfil a customer's need (at a price point) to be successful. So is there a need and at what price?

Mobile phone manufacturers have a strategy that is forcing the issue and creating hype around the technology but who is going to make money?

First the mobile phone manufacturers strategy. Make a mobile phone. Then make smaller phones, make it in different shapes and colours, then add polyphonic ring tones to the next generation, two band, tri-band, mp3 players, cameras, more storage, more computing power etc. With each generation, a new function gradually makes the older phones less desirable and obsolete, causing the consumer to up grade.

Network operators have fed this beast by using new phones to tempt people from other operators and upgrades to keep them. Who wins out of this Nokia Samsung, Erickson and the others keep their factories in operation so they are. Network operators? Probably not as customers shuffel around the networks they probably tend to maintain a status quo. The consumers? Maybe if they value the phone and its functions above the higher services charges the operators have to maintain, in order to pay the manufacturers.

Anyway, adding features to a phone was totally in the hands of the manufacturer. For example adding a camera to a phone didn’t require the network operator or anyone else to change their operation or service. Neither did adding an MP3 player. That is not to say that business did not see the opportunity to sell downloads and data services around these. However, put video on a phone and you are faced with some significant technical, operational and commercial differences.

First the bandwidth required is much higher if you are going to do anything more that preloaded video. Secondly you are going to need content that people want to watch.

As well as being obvious they don’t sound too hard and they are not, except in one area and that is the commercial area of who pays, how much and to whom?

Obviously the mobile video network needs to be paid for. That is technically possible as the many trials have proven. Payment comes from usage – the more you use the more you pay – but to complicate this simple model put yourself in the position of a TV broadcaster who wants to put there channel on mobile. They could pay through revenues they get for advertising around their programmes. Well that would be OK if the current research didn’t show that 2 to 3 minutes is about as long a programme people want to watch on their phone. Put adverts in front or interrupt the video with an ad and the consumer doesn’t watch. Bigger screens like those on the PSP and iPhone will push up the viewing time (as long as the batteries last)

Make the consumer pay-per-view or subscription. If Wimbledon tennis on and you’re a fan then you might, for a fortnight, but the rest of the time? Event specific subscriptions may have a place, but will you be able to see the ball on such a small screen?

So as we look at who pays for the network and why, we have crossed over into the second problem of content. BSkyB has paid for the Premier football rights, in order to attract customers to their satellite services. They are not going to be pleased if you can see every goal on your mobile for a few pennies that cover the network costs. They or the Premier league will also want their value recognised and rewarded. And its not just a case of taking Sky’s pictures and putting it on mobile. The picture needs to be zoomed in so you can see the action – possibly graphics need to be created so the off-ball actions can be seen – and therefore the costs just went up for Sky.

User generated content where your friends in night club send 20 seconds of video to your mobile phone to show you what a great time they are having is a low cost from of content that has a place in the market. Its very network heavy in terms of bandwidth as the point to point transmission can be almost the same as a point to multipoint of a broadcast.

The result is the mobile phone manufacturers can’t get video to the mobile off the ground globally as they might like - there are some parts of the world that have started. Some manufacturers have diversified to resolve all the issues with launching a mobile TV service to the extent that Nokia can supply all the technology for encoding, managing and transmitting mobile video content. They just can’t get the content that people want and they haven’t resolved the commercial model for how anyone (other then them) make money at it.

The next step for manufacturers, like Nokia, maybe to launch their own mobile video service, buy content rights and put their money where their mouth is.