TelcoTV: Ads not mobile TV’s savior, MobiTV president says

ANAHEIM, Calif. – Despite industry talk of advertising as the catalyst to kick-start mobile TV adoption, at least one mobile TV provider isn’t holding its breath. Paul Scanlan, president and co-founder of MobiTV, a pioneer in packet-based mobile TV delivery, told TelcoTV attendees today that advertising won’t be the monetization model of the future. But that’s not necessarily a bad thing for business model-driven wireless carriers.

“There’s an opportunity for broadband operators particularly to take advantage of billing relationships to leverage the free content and add the layer of premium content,” Scanlan said. “That’s the biggest opportunity.”

Building on AT&T’s and Verizon’s keynote addresses yesterday, both of which focused on the new model of TV viewing, Scanlon said that mobile TV is an inexorable component of the television industry’s future. The TV industry is rapidly going the way of the music industry – all online and free for the taking – creating a TV landscape marked by both excitement and pure panic. As the most immediate, personal and relevant devices, mobile devices can be leveraged to revitalize the TV market and create TV 2.0.

“What we see is a little bit of panic,” Scanlan said. “The TV industry is looking at the music industry and wondering if that will happen to them. If it does, it could be disaster ahead.”

Monetization, the most critical piece of value chain, is the cause of the panic, he added. Advertising is widely prized but not a silver bullet, Scanlan said. MobiTV has close ties to the content industry and is confident, ESPN, for one, is not going to deliver its channel on just an ad-supported model. With almost 90% of ad dollars made across 2% of video content, the prime-time content that’s always been free, the model doesn’t translate to coveted channels like ESPN.

“The production value of prime-time content is declining because their ad base is declining,” Scanlan said.

An example of building an alternative premium model comes from MobiTV’s recently launched vertically customized mobile TV service centered on business, Mobi4Biz. The app’s value comes not just from the TV content but from the broader set of content built around it, Scanlan said. The experience is the same on the PC or mobile, another important component, he added. Business is the first of many verticals MobiTV is targeting, with sports being its next focus.