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Ongoing Fall in Viewer Retention Overshadows 36% Mobile TV Growth
BARCELONA, Spain, February 12 /PRNewswire/ --
- Survey of 34,000 mobile users reveals revenue potential for operators
if quality and reliability improve
Mobile World Congress -- A survey of mobile subscribers in Europe and
North America reveals a mixed report card for mobile TV services. The
M:Metrics study(1), commissioned by Tellabs, highlights a US$270 million
opportunity -- but only if operators meet user demands for quality and
reliability improvements in the coming 12 months.
This conservative revenue projection is based on operators reversing an
alarming trend: former mobile TV users grew 68% in 2007, outpacing the growth
of the total market (36%).(2) A year after Tellabs' first M:Metrics survey,
users still point to weaknesses in mobile TV services.
After price, mobile users still cite quality and reliability as the
second most important reason for their disenchantment. Yet those ex-users
grant operators a clear window of opportunity: 60% would pay to watch mobile
TV again if service quality and reliability significantly improved in the
coming year. By regaining just half the potential market lost due to quality
and reliability issues, operators could secure the revenue projection.(3)
Users send clear message
"Users decide which new services succeed, not the industry," said Pat
Dolan, vice president for EMEA, Tellabs. At Mobile World Congress, the mobile
industry is debating how operators can raise new revenues by bringing new
services to market. These results come as a timely reminder as to who's in
charge.
"It's challenging for operators to make a living as mere pipe vendors,"
added Dolan. "By offering mobile content users enjoy, operators can increase
revenue. Yet this necessitates network enhancements, as acceptance of
high-bandwidth services depends on the quality, reliability and capacity of
the mobile backhaul. Tellabs is working with many operators in addressing
these issues, and we are confident the industry will progress further."
Revealing year-on-year and country comparisons
The Tellabs-commissioned research on mobile TV users' attitudes was
conducted by M:Metrics in the United Kingdom, Germany, Italy, France, Spain
and for the first time this year, the United States.
While the growth of ex-users outpaces growth in current users of mobile
TV across all geographies studied, the authoritative results also highlight
country-specific trends:
-- The UK had the highest ratio of ex-users citing quality and
reliability as reasons for not watching mobile TV.
-- The United States has the lowest ratio of ex-users to users, at 1.3.
Yet the attitudes of U.S. ex-users with regards to quality and
reliability are very much in line with their European counterparts.
-- Overall mobile TV penetration in the United States lags behind all
European markets but Germany.
-- Interestingly Germany showed a staggering 159% growth in ex-users,
while Italy has the highest percentage of mobile TV viewers.
M:Metrics defines opportunity for 2008
"It's tempting to celebrate the 36% growth in audience for mobile TV,"
said Paul Goode, senior analyst, M:Metrics. "Yet operators will be
disappointed; while the marketing dollars invested in this nascent industry
appear to be working, the trend in ex-user growth is undoing all of this good
work. The challenge and opportunity for 2008 is to win former users back with
better network quality and reliability -- while getting it right with new
users first time around."
Solving the capacity crunch issues
High-bandwidth services such as mobile TV combined with the increasing
number of mobile users cause strain on backhaul networks. This capacity
crunch can directly affect the quality and reliability of 3G services.
Operators need a backhaul architecture that automatically assures bandwidth
and priority to prevent bottlenecks. To ensure users can enjoy mobile TV,
operators are migrating to pseudowire-based platforms that enable Ethernet
backhauling with strict Quality of Service and high reliability.
The Tellabs(R) IntegratedMobile(SM) solution, showcased at MWC, enables
operators to migrate to new services quickly and cost-effectively. Tellabs'
growing customer base is a clear indicator that operators are keen to act now
and seize the window of opportunity highlighted through the research.
1. Source: M:Metrics' Survey of British, German, French, Spanish, Italian
and U.S. mobile subscribers aged 13 and above in October 2007,
n=34,675. US ratio was 10,943 of total.
2. From January to November 2007
3. The estimate of US$270 million revenue is derived from the assumption
of retrieving a potential 932,000 ex-users who were disenchanted due to
quality and reliability issues, plus gaining an additional 3,151,000
first time viewers currently held back by the same issues. Assuming
half of these (2,000,000) subscribed for a year with an average monthly
fee of US$11.30, this alone would result in an 54% increase in audience
and an estimated US$270 million extra in revenue.
4. See appendix for statistics from Europe and USA.
About Tellabs
Tellabs advances telecommunications networks to meet the evolving needs
of users. Solutions from Tellabs enable service providers to deliver
high-quality voice, video and data services over wireline and wireless
networks around the world. Ranked among the BusinessWeek InfoTech 100,
Tellabs (Nasdaq: TLAB) is part of the NASDAQ-100 Index, NASDAQ Global Select
Market, Ocean Tomo 300(TM) Patent Index and the S&P 500.
http://www.tellabs.com
Tellabs(R) and "(R) are trademarks of Tellabs or its affiliates in the
United States and/or other countries. Any other company or product names
mentioned herein may be trademarks of their respective companies.
About M:Metrics
M:Metrics is the mobile media authority. As the only research firm to
measure the audience for mobile media, M:Metrics provides the most accurate
metrics on actual mobile content consumption by applying trusted media
measurement methodologies to the mobile market.
M:Metrics' monthly syndicated data service gives clients the critical
insights and intelligence required to inform smart business strategies and
the competitive benchmarks needed to evaluate the performance of competitors
and partners. M:Metrics is a private, venture-funded corporation
headquartered in Seattle, with offices in San Francisco and London.
About M:Metrics Data
Based on continually refreshed samples of nationally representative
mobile phone consumers, M:Metrics reports summarise market size, device
reach, and key demographic and mobile phone usage characteristics.
The data presented here is drawn from an extensive survey questionnaire
that collects specific device model and carrier subscription information from
each month's sample of mobile phone subscribers, and also drills down into
specific details related to current and past usage of various mobile phone
applications and content. Data collected from each sample are statistically
balanced and projected to the total national population of mobile phone
subscribers.
Appendix
DE ES FR IT UK US
Number of Mobile
Phone Subscribers
watching mobile
TV (3 month avg
Nov 07) 281,416 305,459 420,629 497,521 482,900 1,737,004
Number of ex-users
for every current
user (3 month avg
Nov 07) 2.1 2.4 2.7 2.2 1.8 1.3
Growth in audience
for Mobile TV
(3 month avg Jan
07 to Nov 07) 51% 17% 44% 23% 25% 45%
Growth in ex-users
of Mobile TV
(3 month avg Jan
07 to Nov 07) 159% 74% 147% 37% 55% 49%
Quality &
Reliability cited
by % of ex-users
as reason for not
watching (Oct 07) 26.7% 28.4% 25.4% 22.7% 30.0% 22.0%
Web site: http://www.tellabs.com
