Is 2010 the break-out year for mobile TV?

Is this the year for mobile TV? For veterans of the wireless industry, that question might sound like a blast from the past: After all, it was in 2004 that Qualcomm set aside roughly $800 million to build a nationwide network in the 700 MHz band that would be dedicated to broadcasting TV to mobile devices.

However, the intervening years have been unkind to mobile TV proponents. Companies including Crown Castle and Aloha Partners' Hiwire have exited the space, and Verizon Wireless and AT&T Mobility have let the service languish in the nether regions of their offerings catalog (relatively few phones support the service years after its commercial introduction).

Verizon, AT&T and Qualcomm all decline to discuss mobile TV subscriber numbers, but with the service costing between $10 per month (with AT&T) and $13-$15 per month (with Verizon) the general consensus is that demand is low and subscriber numbers paltry. Indeed, Qualcomm disclosed in a recent Securities and Exchange Commission filing that its Flo TV subsidiary (part of its QSI business) posted revenues in the first quarter of fiscal 2010 of just $2 million, down from the $6 million it posted in the year-ago quarter. The company recorded a loss before taxes of $107 million, up from $98 million in the year-ago quarter.

But the introduction of the ATSC M/H standard appears to have helped rejuvenate the space. The standard allows local TV broadcasters to add a mobile component to the signal they are already transmitting to stationary TV sets. The effort has so far generated a notable amount of interest, with a range of companies at last month's Consumer Electronics Show demonstrating prototypes or commercial products sporting the protocol.

And it looks like Qualcomm has no intention of fading quietly into mobile TV history. Last year, the company unveiled its direct-to-consumer mobile TV ambitions--an action possibly motivated by the coupling of sluggish mobile TV sales at the nation's two largest carriers with the nascent but growing threat of free mobile TV from local broadcasters.

I spoke with some of the executives from Qualcomm's Flo TV subsidiary during CES in Las Vegas. They sought to frame the company's direct-to-consumer strategy as a natural evolution of a relatively successful mobile TV effort, rather than a last-gasp play by a company desperate to turn around its fortunes.

Regardless of the motivation, it looks like Qualcomm is going all in. The company purchased three TV spots during Sunday's Super Bowl that, according to the Associated Press, may have cost upwards of $8.4 million.

Qualcomm's hope is that its Flo TV service gets embedded into all sorts of gizmos, from computers to automobiles. So far, though, Flo TV is available via a dedicated handheld that goes for the astounding price of $250. The company also recently announced a mobile TV-capable jacket for iPhones, though pricing has yet to be announced. More gadgets (beyond existing cell phones) are coming, executives promised.

Qualcomm's marketing push, combined with the noise around the ATSC M/H standard, could well spark the widespread consumer interest in mobile TV that's needed to set the space on fire. It's unclear whether that will actually happen.

What's interesting, though, is that the impetus for Qualcomm's decision to invest $800 million in mobile TV was to offload data-heavy video content from the cellular network and onto a dedicated broadcast network. That reasoning seems especially prescient today, in light of the data crush threatening to overload some operators' networks. --Mike