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MCVPlans 2012 Mobile DTV Consumer Launch

The Mobile Content Venture has confirmed that it will meet
its goal of launching mobile digital TV signals at broadcast stations covering
50% of the U.S. by the end of this year and that the group is planning a consumer
launch of mobile DTV services in 2012, reports Erik Moreno, co-general manager
of MCV and senior VP of the Fox Networks Group.

Moreno also stresses that they had also developed new
technologies for improved consumer devices that will offer improved reception
for VHF stations and that they had successfully gained major commitments from
consumer electronics (CE) manufacturers to bring mobile DTV capable devices to
market in 2012.

"MCV has gone ahead and categorically broken the chicken and
the egg problem by reaching our goal of lighting up stations covering 50% of
the country by the end of the year," a move that has convinced a number of CE
manufacturers to develop new devices, Moreno says.

Moreno also supplied data showing that all the top 6 DMAs
will have mobile DTV services by the end of 2011, and that 22 of the top 25
DMAs will have services. A number of the top DMAs will also have multiple
channels available from Fox, NBC, ION, Telemundo and PBS.

Moreno also argued at length that the FCC's insistence on auctioning
spectrum for additional IP-based network deployment "is not the right approach"
and that mobile DTV platforms offered a more feasible way of satisfying burgeoning
consumer demand for broadband data and video.

"We are part of the long-term solution to the explosion of
mobile internet traffic," he contended.

MCV is a joint venture between three networks, Fox, NBC, and
ION and the Pearl Group, which is made up of a number of large station groups
covering about 75% of the country.

Moreno delivered an off the record speech last week to broadcasters
at the B&C News Technology Summit in Dallas but agreed to allow B&C to
report the contents of the speech during a lengthy on the record interview.

Moreno declined to discuss exact dates for the 2012 consumer
launches or specific devices, but noted that they were planning a "kind of
rolling thunder," with different devices launching at different times, he notes

"We will have some very interesting announcements in the coming
months with regards to partners for devices and distributors," he says.

The group is targeting a number of different kinds of
devices, including smart phones, devices for vehicles and tablets.

Tablets are expected to play a particularly large role in
their plans because they are a perfect vehicle for consuming video and because tablet
purchases are generally not tied to mobile carrier contracts in the way that smart
phones are.

Moreno notes that a deal with telcos and mobile carriers
would ultimately be very important for the success of mobile DTV because those
carriers would provide a "return path" over their IP networks needed for on
demand content and other services.

Carriers will also be critical to convincing CE
manufacturers to produce smart phones with chips capable of receiving mobile
DTV signals.

While Moreno admits they would not have a deal with a carrier
at launch, he stressed that such an alliance is now less important that it
seemed when the mobile DTV technology was first being developing several years

"I don't need a deal with the carriers when it comes to tablets,"
he notes in an interview. "Yes the carriers are very important for smart phones
but Apple has already sold over 40 million iPads and I expect the Kindle Fire
to be a huge success at Christmas. So I think there has been too much of a
fixation on the carriers. They are the lynchpin in the smart phone devices but
my guess is that we will hit them last."

Moreno also notes that they had been working with CE
manufacturers to develop technology for compact antennas for the reception of
mobile DTV signals.

"There had been an argument that you would need a 24-inch or
16-inch whip-antenna for a high VHF station, which is unsightly and
unacceptable for a consumer device," he says. "I can't declare complete victory
in that problem but I can say that with the successes we've seen, we are
optimistic that we have developed a very elegant solution."

In the interview and during his speech to broadcasters last
week, Moreno stressed the importance of timing in the success of their plans
and argued that the confluence of several factors will work in broadcaster's
favor, making 2012 "the right time for the launch of a consumer service."

Besides the growing popularity of tablets, which are a
perfect vehicle for mobile video consumption and have made carriers less
important for their initial rollouts, Moreno also notes that "we at the cusp of
massive growth in data traffic, which is going to be a massive problem for
carriers," which will make mobile DTV services an necessary complement to
traditional cellular data networks.

During his speech last week, Moreno noted that the number of
smart phones has exploded from 67 million in 2010 to 84 million in 2011 and are
expected to hit 118 million in 2013, according to Morgan Stanley. During the
same time frame, the number of tablets is expected to more than quadruple from
10 million in 2010 to an estimated 44 million in 2013.

These devices are also incredibly data and video hungry,
with the average smart phone consuming 24 times the monthly data usage of a
regular handset and tablets consuming 122 times more data.

As a result, Moreno cited statistics from Cisco projecting
that North American data traffic will grow 82% a year from 49,000 terabytes in
2010 to 986,000 terabytes in 2015.

That explosion of traffic has pushed carriers to impose usage
caps. Moreno noted that AT&T's 2 gigabyte per month plan allows users only
33.3 millions of YouTube quality video and only 2.2 minute of HD quality fare.

Expanding existing cellular networks to satisfy that pent up
consumer demand would be hugely expensive and might not even be possible, he

"IP networks simply do not have the capacity to service the
peak demand represented by live mobile video," he noted in his speech. "I will
tell you categorically, and with great certainty, that the FCC's insistence on
auctioning spectrum for additional IP-based network deployment-be they 4G, 5G
or 6G-is not the right approach."

While carriers are spending tens of billions of dollars to
roll-out 4G networks, Moreno also stressed that it was only costing stations
$75,000 to $150,000 to launch mobile DTV services. "The rough math for the cost
of launching six stations in the top 200 DMAs covering over 90 percent of the
U.S. produce an investment of about $120 million," he noted in an interview.

As a result, he argues that the mobile DTV services will
play a significant role in easing network constraints by handling the most
popular video content over their one-to-many network architecture.

While Moreno acknowledges that stations were worried that
the loss of spectrum might make it harder to launch mobile DTV services, he
stresses in the interview that "we are making real investments and real
marketing dollars behind his launch and we think we can make a very good and
convincing case to the FCC."

"This country needs a broadcast-based network, optimized for
video, operating in parallel to existing IP-networks," he noted in his speech.