FloTV's reality check: It's about coverage, price and devices

The delay in the digital TV transition may have dealt MediaFLO's FloTV a blow but that isn't stopping new President Bill Stone from seeing plenty of opportunity. FloTV had planned to quickly expand to 100 more markets in February but thanks to the DTV Delay Act, which postponed the transition to digital TV until June 12, those plans had to be put on hold--or at least partially on hold.

I spoke with Stone last week, my first interview with him since he joined FloTV in late January. A veteran of Verizon Wireless, Amp'd Mobile and most recently, Handango, Stone said that despite the DTV Delay Act, the company is still expanding where it can. Because Flo TV's spectrum is in channel 55, Stone said some of the broadcasters are making the transition early because it costs them to keep transmitting in analog. "If we are within the interference guidelines, we can fire up those markets," Stone said. "We are quietly working behind the scenes so that we are ready when everything goes digital."

But coverage isn't the only challenge facing FloTV. I questioned Stone about the price; Verizon and AT&T both sell the service bundled with other data services. He said FloTV offered through other distribution partners such as Audiovox (which plans to use FloTV to deliver live TV in vehicles) may offer consumers a different pricing scenario. "We need to make sure we have the price points right to fit the value of the content," Stone said, without revealing too many details. However, don't expect a pure ad-supported model. "I don't see a model for a free service," he said.

Once FloTV is able to expand into the additional 100 markets, Stone says there will likely be more Media FLO devices on the market. Scale is everything and more markets equates to more distribution partners, more devices and more subscribers. "For us, the network is all about scale. Once you have the network built, you can get as many customers as you need without expanding capacity," Stone said.

DTV roadblocks aside, Stone's vision for FloTV seems clear: Increase coverage, build distribution, adjust the price point and grow device selection. If he can accomplish all those things, I suspect we will finally see the momentum in mobile TV that we've been patiently waiting for. -- Sue [1]