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Mobile500 Eyes Fall Launch for National Mobile DTV Service

The Mobile500 Alliance, which is backed by broadcasters owning over 420 stations, is planning launch a national mobile DTV offering that will ultimately include 15 to 20 channels sometime in the fourth quarter of 2011 and is actively seeking investors and content partners for the effort. The service will include a mix of local and national offerings, as well as free and pay services covering a number of popular genres.

Over 70 stations around the country are already broadcasting mobile DTV signals and the Mobile500 Alliance believes their business plan for the launch of a bouquet of national and local channels will help jump start the technology, both with consumers and consumer electronics manufacturers, noted Colleen Brown, president and CEO of Fisher Communications and president of the board of the Mobile500.

"We think the more mobile content is out there, the more driven the consumer will be to make sure there is a mobile DTV antenna in....whatever device they're purchasing," Brown explained in an interview.

During NAB, the members of the Alliance voted unanimously to approve the plan, "which calls for the creation of a new company, NMS or National Mobile System," Brown added. "The service is planned as a totally open standard based architecture. We expect to provide service to a variety of distribution and content partners who will market service to customers either as a standalone service or in conjunction with broader services and data services they are already offering."

The group will be asking members to "either contribute spectrum or create channels for the national services" in exchange for equity in NMS and "they will be awarded equity for creating their own local mobile DTV service in their market as well as contributing a certain amount of spectrum," Brown noted.

The Mobile500 is also talking to private equity groups and other strategic partners to provide investments, technology or content.

Response from both private equity groups and potential content partners has been very strong, noted the group's executive director John Lawson.

But given the tight timetable for the launch, he expects that they will have a more restricted content line-up at launch, with the number of channels growing over time to 15 to 20.

The Mobile500 would like to line up a deal with a telco partner, which would help get mobile DTV devices into the market, provide subscriber management services and would provide them with a cellular data service for interactive features.

Such an alliance could potentially be helpful to the telco as well, since the one-to-many structure of broadcast signals would help reduce the heavy demands that popular video content is placing on cellular networks.

But the Mobile500 is not basing its launch plans on that happening and is planning to go forward without a deal.

In a May 31 filing with the FCC, broadcaster-backed consortium also raised a number of concerns about the impact of the proposed AT&T and T-Mobile merger on mobile DTV technologies.

The filing argue that the merger would "give the merged firm the ability and incentive to foreclose the emerging competition from broadcast mobile DTV" giving it "sufficient market power to prevent handset manufacturers from making devices with the microchips required to receive broadcast mobile DTV signals." This would increase "the possibility that it would enter commercial relationships that will prevent device manufacturers from deploying broadcast mobile DTV enabled devices, foreclosing the competition that Mobile500 might otherwise provide."

The filing also noted that the merged firm "would have the ability and incentive" to avoid entering into deals with mobile DTV providers for a cellular data service that would connect mobile DTV devices to the internet, a feature that will be important for the ultimately success of the technology.

To overcome those problems, the group has asked the FCC to "require the merged firm to reach a commercial agreement through good faith negotiations" to offer mobile DTV capable device, with the goal of having 50% of all device sold being mobile DTV capable by the fourth quarter of 2011.

The filing also asked that the merged firm provide a backchannel to any nationwide broadcast mobile DTV network and that it provide usage data "unimpeded back to the content distributor."

"Usage data and audience measurement data is absolutely critical for the business model we want," Lawson noted. "We want it acknowledged through this proceeding by AT&T that audience data belongs to the content distributor" and that this data should be provided to the content distributor.