ICASA must resolve the mobile TV debate

South Africa is estimated to have a total of 11 million households, of which 7.3 million or just over 66% own at least one television set, well within the 65,3% world average, according to information hub. http://www.nationmaster.com/ . South Africa’s household ownership rate of TV sets is extremely high by developing world and specifically African, standards. As an example, according to Nation Master, Africa’s most populous nation Nigeria, has a household TV set ownership rate of a mere 25,6%. The ownership rate in most developed countries is significantly higher than the global average, with the top ten countries recording rates above the 99% mark. From a marketing perspective, it obviously means that in the developed world, television is an effective medium through which to reach the broader population and this is clearly not so for marketers in the developing world, South Africa included, where TV has to be supplemented with other mediums.

The Mobile TV debate

Which brings me to the debate currently brewing in South Africa about whether ICASA (the Independent Communications Authority of South Africa) should issue a mobile TV license or not. Recently, free-to-air broadcaster, e.tv lodged a court application to prevent ICASA from implementing the proposed digital migration plan. According to media reports, chief among e.tv’s concerns about the digitization plan, is ICASA’s intention to commence a process aimed at issuing a mobile TV license. E.tv points out that mobile TV, sometimes referred to as Digital Video Broadcast via Handheld(DVB-H) device, a mobile broadcast format which has gained favour globally, has no track record of commercial viability in any market where it has been launched and that it would therefore be irresponsible of ICASA to award a DVB-H license without a detailed feasibility study. One would hope and assume that ICASA indeed has plans to carryout a feasibility study before issuing a DVB-H license and therefore e.tv’s protestations could be seen to be driven largely by the broadcaster’s fear of the impact DVB-H could have on the overall TV audience dynamics in South Africa.

Is mobile TV viable?

Many countries around the world have been involved in DVB-H trials since the early part of this decade. 3 Mobile, the European broadband network operator, was among the first in the world to launch a commercial DVB-H offering in the form of 3TV in Italy. Interestingly, 3TV Italy offers both free-to-air (non-subscription) and pay-tv services. Many other countries such as Finland have also been testing DVB-H and back in December of 2006 the Finnish regulatory body awarded Digita, a mobile network operator, the only DVB-H license in that country. Almost four years down the line, Digita is yet to launch a commercial offering. Marianne Hynninen, the Business Manager of Digita’s mobile TV division says, “plans are underway to launch our mobile TV service before the end of this year.” Hynninen further points outs that, “a leading media research organization in Finland (Finnpanel) estimates that there is a total of 16,000 (sixteen thousand) households situated in the area where the DVB-H signal will be broadcast.” In my view, this is a very small number given that Finland has in excess of 2,3 million households, meaning the DVB-H signal will only be available to less than 1% of Finnish households. Hynninen could not be drawn into a discussion about whether or not Digita’s mobile TV service will be commercially viable. However, based on the numbers stated above, I personally doubt very much that Digita will be depositing any profits into their bank account any time soon, unless the DVB-H signal broadcast range is increased to cover more of the country and therefore a greater number of households. Regulators in many other countries in Europe, North America and Asia have been issuing DVB-H licenses over the past few years yet to date very few of those licensed entities have launched commercially. Perhaps e.tv and other like-minded entities are justified in pushing ICASA to carryout a detailed feasibility study before issuing a DVB-H license.

Critical elements ICASA must consider

There are many critical questions which ICASA must surely answer vis-a-vis DVB-H licensing, these include but are not limited to: a) should the regulator issue separate licences for free-to-air and pay-TV or one licence for both services?; b) should the regulator issue a license to one or more licensees?; c) should the regulator award licences to incumbent mobile network operators and TV broadcasters (Multichoice has been testing DVB-H in South Africa since 2006) or to entities with no track record in either the telecoms nor the broadcast business and lastly d) what should be the coverage area of the DVB-H signal? I must add that in reading the document published by ICASA in December 2008, wherein the Regulator invites interested parties to apply for a license to deliver DVB-H services, it’s evident that the regulator has indeed already begun to address some of the questions listed above. I must point out that following the outcry led by e.tv, ICASA has since withdrawn its call for interested parties t apply for a DVB-H, license this is presumably to because IACSA wants to tighten up on the feasibility for the mobile TV in South Arica.

ICASA must act quickly

Perhaps a more critical element that will determine the commercial viability of mobile TV in South Africa relates to something that ICASA may not be able to influence directly and that is, the price at which DVB-H-capable handsets will go to market, as this may be the single biggest barrier to the growth of mobile TV in South Africa. Assuming however that the handset manufacturers are able to bring the price down over time, my opinion is that given the number of people in South Africa who are still without a television set in their homes, a mobile TV companion could come in very handy indeed, no pun intended. Imagine therefore watching next year’s FIFA World Cup on your mobile handset wherever you may be, or being able to keep track of your favourite soap opera, regardless of your location. For the sake of the consumer, IACSA must carryout the feasibility study on the commercial viability of mobile TV and it must do it quickly. As consumers perhaps we should all be singing those famous lyrics, “I want my, I want my MTV”, from a Dire Straits song, except this time instead of making reference to the now popular music channel South Africans would be referring to mobile, mobile TV.