Video on wireless a niche, but growing

ATLANTA--

Video delivered to wireless subscribers is already hear, but a number of issues need to be resolved before it becomes a mass market services, according to executives at The Mobile Entertainment Forum here.

Speaking before the open of the CTIA show at the Georgia World Congress Center, a number of executives said Japan clearly leading the world in adoption of mobile video in part because of demographics as well as unified standards. However, there is a small but growing market of users in the U.S., according to Phillip Alvelda, chairman and CEO of MobiTV, which has signed agreements with numerous cable networks including MSNBC, Discovery and TLC to distribute their content to mobile users.

“There are two classes that we divide people into—the time killers and the need-to-knows,” Alvelda said.

The former, which includes everyone from college students to road warriors waiting for planes tend to reflect habits that mimic television viewers. The latter tends to act more like web surfers, searching out for specific channels when a major event occurs.

“We saw massive spikes when Michael Jackson was arrested; we saw massive spikes was Sadam Hussein was capture,” Alvelda said. “We’re still in the early stages, though, so it’s a little hard to tell how everyone is going to act.”

One thing that is becoming clearer though not certain is the business model. Under MobiTV’s plan, customers pay a small premium for the service. However, the company is still dependent on ad revenue that has becoming increasingly hard to get for even traditional cable networks.

“One of the benefits [of relying on ads] is our market skews very heavily to the young, hip early adopter,” Alvelda said.