MobiTV talks iPhone, D2C and Euro ambitions

Mobile TV has had its ups and downs in recent years, but MobiTV seems to be doing pretty well.

In June, the company announced it had more than seven million subscribers for its service, while it’s also diversified onto iPhone with a popular ‘March Madness’ basketball TV app for CBS Sports.

Having first launched back in 2003, MobiTV has seen the highs and lows of the mobile TV market too.

“When we launched, we couldn’t get any of the major content partners to distribute their prime-time or valuable content,” says Ray DeRenzo, the company’s chief marketing officer.

“We had shows that were made in people’s basements! It was really quite amateurish almost, not to be derisive. It was very much a proof of concept that you could do this, but it took a while for the media companies to look at mobile as a legitimate platform for their assets.”

Application stations

The March Madness app shows how that has changed: the US college basketball tournament is one of CBS Sports’ hottest broadcast properties. MobiTV’s app streamed 63 matches live, but also offered interactive features around them.

It’s part of the company’s diversification into apps, which DeRenzo says is partly about deepening its relationship with the broadcasters and sports leagues.

“But it’s also much easier for us to innovate in these applications,” he says. “We can build new functionality in them, and then transfer it to our core TV product, which continues to be distributed primarily through the wireless operators.”

DeRenzo explains that MobiTV might only refresh that core service twice a year, due to its complexity and its large customer base. One-off apps around major events offer an opportunity to try new features more often.

“In a six month period, we might be able to do ten applications, and every one affords us a new opportunity to introduce a new feature,” he says.

“We also get better feedback when we distribute through these app stores, directly from consumers who rate and review the applications. We had more than 4,000 reviews of the March Madness app – it’s consumer input in real-time.”

DeRenzo says MobiTV is looking to support other app stores too with selected applications, including BlackBerry and Android.

Meanwhile, it has three more iPhone apps set to launch in the coming weeks, two focused on US sports brands, and one focused on a more global body.

Viewing patterns

Meanwhile, MobiTV’s core service, distributed through operators, continues to grow.

DeRenzo says consumer behaviour remains much the same – people tend to dip in for 5-7 minutes to watch a channel, which favours live events, news and sports, and also the company’s own music channels.

“What has done less well on the core TV service has been prime-time 60-minute episodic content,” he says. “However, that same content performs extraordinarily well when you offer it on a video-on-demand basis, which we do.”

This is the other part of MobiTV’s operator offering – the ability for users to stream 60-minute episodes of shows like CSI: New York, except broken down into mobile-friendly chunks of 6-8 minutes, sans advertisements.

“Being able to present that episodic content in smaller increments has performed very well,” says DeRenzo.

However, MobiTV is also working on a third distribution method – the ability for subscribers to download shows to their device and watch them when not connected to the network, as part of their existing monthly subscription (rather than an a la carte model where they pay per show).

Going direct

The bulk of MobiTV’s business outside the recent apps has come from its carrier deals, but that too is evolving. DeRenzo doesn’t jump onto the D2C bandwagon, but does acknowledge that going direct will play more of a role going forward.

“90% of our subscribers are coming into us through our carrier distribution channels, and 10% through storefronts and alternate channels,” he says.

“I still think the carrier channel will be incredibly important, but we also see these emerging [app] storefronts, and we’ll distribute the MobiTV product through them. I don’t think it will become the majority of our distribution, but we may go from 90:10 to 70:30.”

How is pricing evolving for MobiTV’s customers – whether direct or via carriers? Right now, the bulk pay between $7.99 and $9.99 a month in a recurring subscription, but is advertising becoming more of a factor – and if so, how much?

DeRenzo is candid about how futureproof the current subscription model is (or isn’t): “I don’t believe that is going to be a sustainable model over time,” he says.

“But I don’t believe that fully advertising-supported is a viable model at present either. We don’t have enough audience amassed for advertisers to get enough value to completely offset the cost of the service.”

Instead, he thinks that some content will be free-to-air and ad-supported, to introduce people to mobile TV, with premium content packages on top of that – entertainment, sports, kids and so on. It’s a familiar model for the cable and satellite TV industries, of course.

“Free to premium will be a model that will evolve over the next two years,” says DeRenzo.

“But there will be more transaction-oriented pay-per-view things, like buying a day pass to watch English Premier League matches that are being played on a particular Saturday.”

Back to Europe

Talking football is probably DeRenzo providing localised references for a British journalist, but it also signals MobiTV looking again at the European market.

A couple of years ago, it launched with Orange and 3 in the UK, while exploring potential operator partnerships in Spain and Germany. It didn’t quite work out.

“Maybe we were naive coming over to Europe,” he says.

“In the US, when we licensed something like the Disney channel, we had the rights to distribute it across the US. When you go to Europe and license the Disney Channel, you have to do it in the UK, France, Germany... We had to work on a very national level in assembling these content packages, and frankly we weren’t expert in how to program mobile content in, say, Germany.”

Instead, MobiTV reined ...