2012 – Global Mobile Broadcast TV subscribers to exceed 150 million
“Currently there are about 4.4 million mobile broadcast TV subscribers globally and at that, split just between a handful of countries. This subscriber base will grow to 65.6 million in 2010 and more than double to an estimated 155.6 million by 2012 - a compound annual growth rate (CAGR) of 66.2%,” says Chris Khouri, associate media and broadcasting analyst with Datamonitor and author of the study. “However, consumer education, technological fragmentation and content adaptation will have to be addressed first before mass-adoption can take place.”
Datamonitor expects the Asia-Pacific region to have 76.3 million subscribers by 2012. Europe will have the second largest subscriber base with an estimated 42.7 million subscribers by 2012 with a CAGR of 102% from 2006. This high growth rate is directly attributable to the predicted pan-European push for mobile broadcast TV between 2009 and 2012. North America, dominated by the United States, is expected to have a subscriber base of 35.6 million.
Mobile broadcast TV is not seen as a significant revenue generation stream at first
Pricing models for mobile broadcast TV vary by region with some service providers opting for a free-to-air service. Most mobile operators, however, would be looking to charge between the regions of $8-12 per month for a mobile broadcast TV service. This model is particularly dependent upon national mobile consumption dynamics. In most Western European and North American regions, subscription models are expected to be the dominant business model at first. Datamonitor does not expect mobile broadcast solutions to be a significant revenue generator until consumers see value in adopting the service.
The movement towards advertising models for revenue generation for mobile broadcast TV has an unquestionably long way to go. The catalyst for this shift is ensuring that both a return on initial investment has been met and that there is a large enough subscriber base to warrant the transition. Once there is a transition, however, Datamonitor considers that the potential benefits of switching to advertising revenue models will be with leveraging operational costs and reducing costs to consumers.
Benefits and challenges for mobile broadcast TV adoption
A primary motivation for content producers to invest in mobile broadcast TV services is to expand audience reach. Mobile network operators (MNOs) stand to gain advantage by adding value to their service network. Essentially, the goal for both players is to boost the attractiveness of a service offering in order to reduce churn to alternative entertainment channels.
Furthermore, there are significant opportunities for technology vendors and systems integrators. Considering the complexity of the ecosystem with competing technologies and formats, there will be an increasing need for mobile network operators (MNOs) and content producers to ensure that their digital assets are managed and transported efficiently and effectively.
Despite these opportunities, there are notable barriers to mass-adoption of mobile broadcast TV services. Content such, as advertising, will have to adapt to the constraints of the mobile device as well as the transforming usage habits of an ‘on-the-go’ consumer. The current fragmentation of bearer technologies (such as DAB-IP, DMB, DVB-H or MediaFLO) will create complexities in implementation. Datamonitor considers that interoperability will play an increasing role for handset manufacturers in order to expand market penetration in multiple regions.
Consumer education is expected to be one of the biggest barriers for mass-adoption.
“In most cases, consumers need to ‘see it to believe it’ in order to see value in subscribing to a mobile broadcast TV service. Strong and innovative marketing campaigns, such as viral marketing or traveling exhibitions, will considerably aide in the mass-adoption of mobile broadcast TV services.”
Datamonitor plc (DTM.L) is the world’s leading provider of online data, analytic and forecasting platforms for key vertical sectors. We help our clients, 5,000 of the world’s leading companies profit from better, more timely decisions. Through our proprietary databases and wealth of expertise, we provide clients with unbiased expert analysis and in-depth forecasts for seven industry sectors: Automotive & Logistics, Consumer Markets, Energy, Financial Services, Healthcare, Retail and Technology. Datamonitor maintains its headquarters in London and has regional offices in Frankfurt, New York, San Francisco and Sydney. See www.datamonitor.com for further details.