Mobile Operators Seek to Move up the Mobile TV Value Chain Says Pyramid Research

Business Wire, April 3, 2006

CAMBRIDGE, Mass. -- With Mobile TV touted as this year's 3G Holy Grail, operators are carefully evaluating their role in the new business models being formed. Mobile TV will in most cases involve a broadcaster between MNOs and Mobile TV programming, meaning additional mark-ups before content reaches the operator.

"With subscribers potentially paying less than $10.00 per month for a mobile TV subscription, and with content costs around $5.00 subscriber, any additional player in the value chain will have a significant impact on operator margins," comments Nick Holland, author of Pyramid Research's report "Rescuing 3G With Mobile TV."

This explains why some MNOs are reaching up the value chain. Late last year, 3 Italia purchased a regional Italian TV broadcaster; Canale 7. This has a number of advantages for the operator:

--3 Italia can develop their own TV programming - driving down their content costs and allowing their content to be resold to other MNOs.

--3 Italia is in a far stronger position to negotiate third party content than operators not directly involved in content creation, production and aggregation.

--A Digital TV broadcasting license. 3 Italia now has the potential to enter the broadcasting element of the value chain.

3 Italia may be the first of many MNOs that decide they want a larger slice of forthcoming Mobile TV revenues. In March, Dutch telco KPN purchased Nozema Services, a company that provides technical services to broadcasters. This move will likely accelerate the rollout of digital TV services for KPN, including mobile TV.

"We may be seeing the start of a new gold rush," concludes Holland.

About "Rescuing 3G With Mobile TV: Business Models and Monetizing 3G"

This report examines the business case for Mobile TV from the mobile operator's perspective, assessing underlying technologies, the MNOs place in the value chain, optimal revenue models, the role of advertising and the overall revenue opportunity for MNOs. The report also builds the case for future mobile TV revenue generation through case-study analysis of current mobile video services. (http://www.pyramidresearch.com/store/rp_mobiletv.htm)

About Pyramid Research

For twenty years, Pyramid Research has helped companies in the converging communications, media and technology industries stay ahead of market trends, understand competitive threats and capitalize on opportunities. (www.pyramidresearch.com)