Going Mobile: Wireless TV Market in the UK Takes Off

You’re in Heathrow waiting for your flight to board or you’re on the train home. You’ve been working non-stop all day, and there’s a little time to relax. Wondering what’s happening with your favorite TV drama or who won the cricket match? It’s time to check out what’s on the newest and smallest screen: your 3G handset. For millions of people in the United Kingdom, getting access to news, information, entertainment, and sports clips is easy. What’s more, they’re being encouraged to use it via billboards, ads in newspapers, and SMS messages from operators, all tirelessly promoting the mobile media revolution.

Just how hot is mobile TV?
Streaming media to mobile handsets is not a new concept (see this February 2004 article). Television streaming to handsets has been available commercially in South Korea since 2002 when SK Telecom introduced its multimedia 3G service. KT launched its FreeTel service in 2004 and a dozen other providers have pilots run in the past two years, but recently the concept is getting a lot of attention, especially in the UK.

A number of factors are converging to bring mobile TV into the spotlight in Europe. First, there’s the growth in adoption of 3G. According to figures published by Informa Telecom and Media’s at the end of January 2006, Western Europe saw 4 million new Wideband Code-Division Multiple Access (WCDMA) subscribers in 4Q 2005, equivalent to 32.3% of the region's 12.39 million total net adds for the period. Taken in concert with figures in previous quarters and for 2004, the data are the strongest indication yet that 3G is finally gaining momentum.

With 7.7% of its 41 million mobile subscribers carrying a 3G handset and paying a premium for 3G network access, the UK represents the largest 3G market in Europe. In terms of percent penetration, the U.K. tops Germany and the U.S., which have 3.2% and 1.9%, respectively.

Another interesting trend has recently been documented by M:Metrics, a market research company that measures the consumption of mobile content and applications and benchmarks the performance of mobile operators. Considering all the functions available to them, subscribers to 3G services in the UK or Germany are five times more likely than their counterparts on 2G networks to use the multimedia features of their handsets. Consider, for example, that 18.9% of UK-based 3G subscribers are sending video from their handsets to another subscriber and nearly 13% are watching short video clips on their handsets.

It’s no surprise that 3G network operators such as Vodafone, 3 UK, Orange UK, T-Mobile, and O2 are fighting over this emerging market. The first step is to conduct trials. Among the most widely publicized trials is one in the Oxford region that issued its interim results in mid-January 2006. O2 and Arqiva are studying the usage of 375 subscribers who are given live 24-hour access to 16 TV channels via modified Nokia 7700 smartphone handsets. Eighty-three percent of trial participants are satisfied with the end-to-end service provided, according to the study. In addition, 76% of participants indicated that they would take up the service within 12 months.

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