Broadcasters bullish on OMVC

I was at the National Association of Broadcasters conference in Las Vegas earlier this week, attending iHollywood Forum's co-located Mobile Entertainment Summit conference, where I was struck by how many people on panels and in the audience seemed to think mobile TV will be the new "killer app" for broadcasters.  

The basis for these claims was an announcement earlier this week at NAB by the Open Mobile Video Coalition. The OMVC said they plan to test digital mobile TV services this year in Seattle, Atlanta and Washington, D.C., and that 70 TV stations, including affiliates of NBC, CBS and Fox have signed on to eventually deliver live broadcasts in 28 markets. They plan to offer the service free to consumers. It will be advertiser supported, similar to traditional broadcast TV.

But I see a couple of snags in this plan. The OMVC and its broadcast partners plan to broadcast their service and have it received on mobile devices, such as cell phones, that will be outfitted with a chip to receive the digital TV signal.  But we know that in the U.S. market, wireless carriers still have enormous control over the handsets that they sell to their customers. They determine the chips, the platform and the services that are incorporated into every handset. Will they sanction a digital TV chip for a service that would compete with their own mobile TV services? I don't think so.

In fact, when asked about OMVC's announcement, Sprint's Mathew Oommen, vice president of product and technology development, told the audience at MES the operator would have to evaluate OMVC's business model before deciding whether to support it. "We have to make money," Oomen said. 

And exactly how OMVC's service will make money isn't clear to me. They say the service will be free and based on advertising revenue. But for the ad-subsidized model to work, the broadcasters will have to get a large audience for their service. I'm not convinced there is enough consumer demand for mobile TV to justify an ad-supported service. After all, Sprint and others have been offering a mobile TV service for several years now and most have seen lackluster customer response. Analyst firm comScore believes that as of February there were only 10.4 million mobile video users. For more in-depth analysis of the ad-supported mobile video market, check out FierceMobileContent's special report on this topic here.

The OMVC has a large task ahead of it. Not only must it trial its technology, but it has to get device makers to put the digital TV chips in their devices, get those devices to market and convince consumers to purchase the devices. I think it may be quite some time before this supposed "killer app" sees any commercial success. -Sue