12 February, 2008 00:02
M:Metrics reckoned that the growth in audience for mobile TV, over a three month average from January 2007 to November 2007 was on average 36%. But it also found that the number of ex-users was growing at an average of 68% across the five markets surveyed (US, UK, Germany, Italy, Spain, France).
Disenchanted mobile TV watchers seemed to be most prevalent in Spain, Germany and France, where there were 159%, 74% and 147% average growth in ex-users. Italy was showing the lowest churn at 37%, with the US at 49% and the UK at 55%.
Yet overall all user growth was also highest in France and Germany, suggesting that although customers are attracted to the proposition, the service experience is turning them off. The USA bucked this trend, showing high overall growth as well as lower churn. Italy and the UK showed both lower levels of growth and churn, suggesting a certain maturity in the market – certainly in Italy’s case. Spain meanwhile showed by far the lowest growth, as well as fairly high churn.
So what’s the cause of this apparent dissatisfaction with mobile TV – and remember this is almost entirely streaming 3G video services in question here, not broadcast mobile TV services? Tellabs’ Jeremey Steventon-Barnes said that after price, the biggest issue that users quoted was quality and reliability. Across the five markets anywhere from 22% to 30% of users reckoned quality was the reason for turning off.
And Steventon-Barnes puts that down to the performance crunch in the backhaul network, which is taxed by the high bandwidth required by streaming video.
He also said that the solving these issues could add $270 million to operators top line across these markets.
Tellabs calculated that if you assumed the market retrieved a potential 932,000 ex-users, plus an additional 3,151,000 first time viewers currently held back by the same issues, it is possible that if even half those subscribed for a year with an average monthly fee of $11.30, this alone would result in an 54% increase in audience and an estimated $270 million extra in revenue.
Of course, Tellabs has a declared interest in convincing operators of the business case benefits of investing in backhaul, but Steventon-Barnes said that although other issues were relevant, such as handset and back office software issues, the backhaul was a critical component in this perception of poor quality and reliability.
“Mobile TV services are really amongst the most demanding applications amongst data services today, and the key issue for mobile data services today is still in the backhaul network. Ensuring quality and reliability across the network and between cell sites and the core of the network is key. Most operators are limited not just in bandwidth, but in their ability to be able to differentiate the quality of service they can offer video traffic, against web browsing, for instance,” Steventon-Barnes said.
“We believe of operators can get quality and reliability right for mobile TV, then not only will that market open up but the whole mobile data market will be opened up as well,” he added.
Tellabs is not the only supplier preaching this message, of course. Switch providers such as Nortel and Juniper, as well as dedicated backhaul players such as RAD Data Communications, Celtro and Axerra all make similar points. But Tellabs is hoping that by emphasising the business impact of a poor quality user experience, it can drive home the impact of potential lost revenues to operators.
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MOBILE TV A GROWING TURN OFF
The number of people turning off mobile TV is, in percentage terms, outstripping the growth of the total mobile TV market, research from M:Metrics, commissioned by Tellabs, suggests.M:Metrics reckoned that the growth in audience for mobile TV, over a three month average from January 2007 to November 2007 was on average 36%. But it also found that the number of ex-users was growing at an average of 68% across the five markets surveyed (US, UK, Germany, Italy, Spain, France).
Disenchanted mobile TV watchers seemed to be most prevalent in Spain, Germany and France, where there were 159%, 74% and 147% average growth in ex-users. Italy was showing the lowest churn at 37%, with the US at 49% and the UK at 55%.
Yet overall all user growth was also highest in France and Germany, suggesting that although customers are attracted to the proposition, the service experience is turning them off. The USA bucked this trend, showing high overall growth as well as lower churn. Italy and the UK showed both lower levels of growth and churn, suggesting a certain maturity in the market – certainly in Italy’s case. Spain meanwhile showed by far the lowest growth, as well as fairly high churn.
So what’s the cause of this apparent dissatisfaction with mobile TV – and remember this is almost entirely streaming 3G video services in question here, not broadcast mobile TV services? Tellabs’ Jeremey Steventon-Barnes said that after price, the biggest issue that users quoted was quality and reliability. Across the five markets anywhere from 22% to 30% of users reckoned quality was the reason for turning off.
And Steventon-Barnes puts that down to the performance crunch in the backhaul network, which is taxed by the high bandwidth required by streaming video.
He also said that the solving these issues could add $270 million to operators top line across these markets.
Tellabs calculated that if you assumed the market retrieved a potential 932,000 ex-users, plus an additional 3,151,000 first time viewers currently held back by the same issues, it is possible that if even half those subscribed for a year with an average monthly fee of $11.30, this alone would result in an 54% increase in audience and an estimated $270 million extra in revenue.
Of course, Tellabs has a declared interest in convincing operators of the business case benefits of investing in backhaul, but Steventon-Barnes said that although other issues were relevant, such as handset and back office software issues, the backhaul was a critical component in this perception of poor quality and reliability.
“Mobile TV services are really amongst the most demanding applications amongst data services today, and the key issue for mobile data services today is still in the backhaul network. Ensuring quality and reliability across the network and between cell sites and the core of the network is key. Most operators are limited not just in bandwidth, but in their ability to be able to differentiate the quality of service they can offer video traffic, against web browsing, for instance,” Steventon-Barnes said.
“We believe of operators can get quality and reliability right for mobile TV, then not only will that market open up but the whole mobile data market will be opened up as well,” he added.
Tellabs is not the only supplier preaching this message, of course. Switch providers such as Nortel and Juniper, as well as dedicated backhaul players such as RAD Data Communications, Celtro and Axerra all make similar points. But Tellabs is hoping that by emphasising the business impact of a poor quality user experience, it can drive home the impact of potential lost revenues to operators.
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