MUMBAI: The Asia-Pacific mobile video services market is expected to see huge growth potential as mobile operators continue to spend millions on developing innovative services and content to arrest the declining average revenue per user (ARPU). Mobile TV, essentially an extension of mobile video services, in particular is seen as a new killer application that could potentially bring alternative source of revenues for carriers.
New analysis from global growth consulting company Frost & Sullivan, Asia Pacific Tunes Up for Mobile TV, finds that the mobile video services market—covering 12 Asia-Pacific countries ex-Japan—earned revenues of over $440 million in 2007 and estimates this to reach $1.88 billion by end-2013, at a CAGR (compound annual growth rate) of 27.4 per cent (2007-2013).
While South Korea (which accounted for 87 per cent or $383.7 million of the revenues in 2007) will remain as the biggest market for mobile video in Asia-Pacific (outside of Japan), other potential leading markets include Singapore, China, Hong Kong, Taiwan, Australia and New Zealand.
"Amid the growing interest in triple-play and mobile advertising, mobile TV has been the buzzword in the Asia-Pacific mobile and wireless market," notes Frost & Sullivan industry analyst Shaker Amin. "The recent spate of trials and the commercial launches of broadcast networks in Japan and South Korea indicate that the mobile TV fever could well catch on throughout the Asia-Pacific region."
Two of the region’s most mature mobile markets, South Korea and Japan, have introduced mobile TV broadcast services (ahead of the other Asia-Pacific countries) built on homegrown standards. South Korea spearheaded the DMB (Digital Multimedia Broadcasting) standards, launching S-DMB (Satellite Digital Multimedia Broadcasting) and T-DMB (Terrestrial Digital Multimedia Broadcasting) in 2005. While Japan launched ISDBT (Integrated Services Digital Broadcasting – Terrestrial), or 1-seg, in 2006.
South Korea is expected to hit mass adoption in mobile video services between 2008 and 2010, when the rest of Asia-Pacific joins the commercial broadcast TV service bandwagon.
Other markets that have commercially launched DVB-H mobile TV broadcast services include Vietnam’s VMC (Vietnam Multimedia Corporation) in September 2006, and Philippines’ Smart Communications in February 2007.
In the rest of the Asia-Pacific markets, digital video broadcast-handheld (DVB-H) and MediaFLO remain most commonly selected for trials. In China, T-DMB (a different version from South Korea’s) and CMMB (China Multimedia Mobile Broadcasting), both homegrown standards, are being deliberated for the country’s national mobile TV broadcast standard.
Pricing, however, remains the biggest hurdle to a wider uptake of mobile video and TV services. In 2007, the total mobile ARPU in Asia-Pacific stood at $16.8 (including Japan), largely due to the region’s lower disposal income.
Furthermore, mobile TV broadcast service (multicast) requires compatible handsets, which are not widely available throughout Asia-Pacific as yet. In markets where an impending launch is expected, mobile handset manufacturers are still in the midst of finalizing handset requirements with the major mobile operators.
"In most markets, mobile video service becomes especially expensive when a user exceeds the stipulated amount of data in a ‘flat-rate’ plan," says Amin. "Considering that this is a major restraint to greater uptake, mobile operators could follow the example of South Korean operators who have implemented an ‘eat-all-you-can’ flat-rate for data charges to encourage adoption."