Mobile TV is a minefield for everybody involved

The big media companies want to have their cake and eat it, too, when it comes to mobile video, and this, I think, will not go over well with consumers. According to Online Media Daily, panelists at the Media Summit New York last week discussed their “preference” for a dual revenue stream model in the mobile video space. Like cable, NBCU and Disney want subscriber fees AND advertising revenues in distributing their content via mobile devices. You want mobile video, you pay a fee to your carrier and then sit through advertising.

No thanks, folks.

NBCU is a place where we make money from distribution partners and advertisers,” said Chip Canter, vice president, wireless platform development at NBC Universal Digital Distribution. “What we’re trying to do is drive dual-revenue stream models: fees for distribution and supplement that with advertising.”

…Tim Connolly, vice president for mobile distribution, ABC, Disney and ESPN Media Networks, explained that Disney isn’t about to offer cable programming for free (ad-supported only) on mobile when it charges cable operators a licensing fee for the same content. “The ad infrastructure in mobile is incredibly immature,” he said. “It’s not anywhere near the point of making it freely available today because the ad structure isn’t there to support it.”

I think all of these people underestimate consumers, who have the power to say “no,” because there are so many other ways to access network “content.” Mobile TV applications, like Verizon’s V‑Cast, are pretty cool, but they’re not cheap. Until people can view mobile TV via their living room sets, I just don’t see this taking off like the networks hope it will. And if there will be ways (Bluetooth?) to move your mobile signal to the “big” TV, who’s going to pay for cable?

And all of these companies are going to have to deal with the clout of Mobile Digital Television (MDTV), which is coming downstream. Media companies with licenses to broadcast digital programming to mobile devices would love to have subscriber fees, but the medium wasn’t created for that. Because it’s free, however, the value proposition for advertising is much more acceptable to consumers, and this is where the money will come from.

I believe the networks need to work with their affiliates to provide cable programming (they all own cable programming) to mobile devices for free, simply because it will be a powerful, new advertising vehicle. If local stations can only broadcast local programming and their own signals, it’s not going to be a profitable venture for anybody. If the nets absolutely insist on subscriber fees, that might be all right as well, but those fees aren’t going to amount to much, especially in the beginning. It’ll take awhile to establish measurement paradigms and the static advertising platform that businesses will need. And if consumers want to move their MDTV to the living room set, the signal will be high-quality and digital, much more suited to a bigger screen.

This is a minefield for everybody involved, and the networks should tread lightly. The dual path may well survive, but it’s very unlikely it’ll be in the form the networks want. Advertising, for example, may be “supplemental” to the nets, but it’s damned irritating to end users. Will a viewer in the supermarket really want to sit through a 5‑minute commercial pod?

Of course, if the networks continue to insist on this “dual path,” then certainly they will one day demand subscriber fees from their affiliates as well. What will happen then? Stay tuned.

Comments

  1. You’re spot on — nobody will tolerate advertising after they’ve paid a premium to watch Daily Show clips they could watch for free online. In the US one of the problems is the cell phone business model — unlike Asia, where people buy devices independently of services, we buy the device from the carrier. They’re not going to offer features — i.e. broadcast TV receiver — that let subscribers get something for free that carriers want to sell to them. It will be interesting to see what happens after the ATSC mobile TV starts rolling out.

Trackbacks

  1. […] Terry Heaton’s PoMo Blog » Blog Archive » Mobile TV is a minefield for everybody involved “The big media companies want to have their cake and eat it, too, when it comes to mobile video, and this, I think, will not go over well with consumers. According to Online Media Daily, panelists at the Media Summit New York last week discussed their “preference” for a dual revenue stream model in the mobile video space. Like cable, NBCU and Disney want subscriber fees AND advertising revenues in distributing their content via mobile devices. You want mobile video, you pay a fee to your carrier and then sit through advertising. No thanks, folks.” (tags: tidbits+fodder business problems tv mobile) […]

Speak Your Mind

*

This site uses Akismet to reduce spam. Learn how your comment data is processed.