Research Proposal submitted to Wireless@KTH
Project Title: A Tele-Economic Study of Mobile TV
Project Background: Mobile TV Services Streamed television services have been around for some time, but only in the past year have dedicated sets of live channels been offered as a package to consumers. While the services to a large extent still are in an embryonic stage, several sources, e.g. Juniper Research (2005) suggest that “these services could well become a significant source of income for operators, aggregators, and application/content providers (p.1)”.
Two key areas have emerged during the past years: streamed content delivered over the existing mobile network, and secondly, separate networks over which mobile content is broadcast using technologies such as DVB-H, DMB, ISDB-T and MediaFLO. Streaming services utilize the existing mobile networks (2.5G, 2.75G, 3G) to stream mobile TV services via an application downloaded to the handset or direct from the portal. As regards broadcasting services, as indicated above, a number of different standards have been developed. While the problem with the streaming services is that a rapid consumer adoption could rapidly exhaust available spectrum, the second type of services require dedicated spectrum. This means that operators might have to wait until a desired bandwidth has been vacated by e.g. an incumbent, analogue TV broadcaster.
The technologies and standards are many, and the involved actor strategies are varied. In Scandinavia, Ericsson, for example has initiated tests based on a new mobile broadcast technology for distribution of multimedia services, such as mobile TV, over 3G networks. It was the first live use of Multimedia Broadcast Service (MBMS), said to allow mobile operators to meet future demands of mobile TV users during peak live broadcasts, such as sporting events, news and music contest finals. As a complement to the unicast solution in mobile networks, MBMS is said to make more efficient use of network resources and capacity through point-to-point connection, allowing an unlimited number of users to watch the same mobile TV program at the same time in the same area. MBMS (like other 3G related technologies: HSDPA and HSUPA) has pros and cons. For example, it has been argued that while spectrum issues are a disadvantage for MBMS, mobile broadcast technologies (e.g DVB-H) might suffer from the difficulties to apply future services based on interactivity.
In Finland, and in the rest of Europe, Nokia has been one of the main actors pushing forward the new mobile broadcast standard DVB-H. In March 2006, the Finnish government granted Digita the operating license for a mobile television network. Digita will be responsible for the broadcasting network and administration of channels as the network operator. Digita’s business model includes open, shared networks, which Digita offers as a neutral operator to all customers with equal, non-discriminating terms. The network will be rolled out as a terrestial digital mass communication network, and Digita’s customers will be either content creators or service operators.
In 2005, broadcast mobile TV services of any description had only been launched in one country, South Korea (a satellite based technology, DVB-S). Juniper Research (2005) has predicted that adoption of broadcast mobile TV services will be high in those countries where services are launched early (South Korea, Japan and more), and expects around 20 countries to have systems to broadcast mobile TV services by 2010. In the short term, streaming services will dominate, but broadcast services have the potential to generate significant revenues already in the medium term (ibid).
Although mobile TV services are at present in their infancy in most countries, most predictions seem to be positive concerning growth. However, a number of issues remain unclear, concerning the mobile TV technologies, industry strategies, and market development and behaviours. This uncertainty, naturally, also concerns the links between the three.
Firstly, as regards the underlying technologies there are still uncertainties connected to the relationships (competition, complementarities, capacities…) between streaming and broadcasting mobile TV technologies and standards, and between the different technologies within each of the two groups. Technology uncertainties also concern future adaptation needs, given a fairly rapid take-off of user adoption of new mobile TV services.
Secondly, against the background of these emerging technologies and uncertain market behaviour, there are presently many uncertainties concerning the future market positions and strategies of: technology suppliers, mobile service operators, TV broadcasters, service content providers and others, all aiming for a stable position in the new, emerging constellations of firms involved in developing and distributing mobile TV services.
Thirdly, despite the high expectations concerning market demand and growth, little is presently known about different customers’ demands and behaviour in mobile TV services. Trials in Finland, England, Spain, France, Italy, and Norway, have indicated some commonalities: consumers generally prefer simplicity and high usability, mobile TV services should show high technical functionality and accessibility, content should be adapted to short periods of viewing time, and complementary mobile services should not be negatively affected by the TV services. Although customer data from test trials exist, there remain a number of uncertainties concerning future market and consumption behaviour: short vs long programs, overview vs width of program supply, regularity vs non-regularity in the timing of consumption, content and payment preferences, and more. What will the “offering” look like, will it be specially developed “mobile TV services”, or “regular TV services adapted to mobile streaming and broadcasting”?
Linking the uncertainties in technologies, industry strategies, and market behaviour, a number of important issues are raised. The project will focus on all three areas and aims to link them.
1.What are the main objectives of the proposed project? The main aim of the proposed techno-economic project is to study the emerging system for mobile TV services, linking technology, strategy and market behaviour. An important part of the objective of the study is also to create new forms of collaboration between Wireless@KTH and Center for Information and Communications at Stockholm School of Economics, including the exploration of contacts with new industry partners (e.g. in the media and TV broadcasting industry). The study is explorative, in the sense that it aims to generate areas for future, joint techno-economic studies, investigating different empirical areas and research methods for future techno-economic research, and also to explore new forms of future research funding.
This will be done in a set of connected, techno-economic studies. The ambition should be to include and integrate both technical and economic aspects in all of these studies. As indicated in the introduction above, the term “economic” in “techno-economic” include both customer, market demand and behaviour aspects, and secondly, strategic, industry behaviour aspects among the involved firms. The following studies/perspectives are proposed:
The (potential) impact on present and potential, future customer and market behaviour of different technological choices:
Technology today allows for a variety of ways to produce, distribute and consume mobile TV services. Broadcasting, streaming, and cashing of mobile TV services are three dominating modes today. Different underlying production/distribution technologies have different strengths and weaknesses when distributing different forms of mobile TV content: scheduled TV, TV on-demand and Push TV. In addition, the consumption of different types of mobile TV service “offerings” demand, and are connected to, different levels of sophistication and technological capacities of handheld devices and technologies; ranging from handhelds with browsers, for video telephony, with channel selectors, devices for participation and interactivity, and devices with program guides and on-demand functions. Hence, the technological options for production/distribution, and consumption of mobile TV are already today varied. The first part of the study puts focus on the impact of technologies on customer behaviour: How do existing and emerging technologies affect customers’ consumption behaviour concerning: time for and timing of different contents, form of and type of content consumed, regularity vs non-regularity in consumption, and also payment preferences, and more. Furthermore, how do consumers adopt and adapt new handheld technologies to increased consumption of new mobileTV services? The studies include focus group studies, and extraction of market behaviour data from previous market studies, potentially, from previous test studies. The market studies will include issues concerning market segments, types of customer demands, and extraction of data concerning potential mobile TV offerings and service bundles.
The impact on present streaming and broadcasting technologies of emerging patterns in customer demands and behaviour:
Technology can also be made a dependent variable. Given the emerging market behaviour seen in the consumption of mobile TV services, (and against the potential market strategies of market actors in the new constellations emerging around mobile TV services), technology (including standards) changes will be necessary. The ambition in this part of the explorative study is to discuss various technology options and the possible technology adaptations that are needed in order to adapt to emerging market behaviour and company strategies. Technology adaptation needs of both streaming and broadcasting technologies, given a fairly rapid take-off of user adoption of new mobile TV services, will be in focus. (The results of these studies will also form the foundation for economic/financial considerations.) For example, since customers will have different terminals with access to varying services, services and technologies must be tailored to each respective terminal in order to provide users with optimal functionality. However, this requires that the operator can determine which terminal– and which network – the user at present is logged on to. This is one type of technological issue emerging from the increased consumption of these services. The amount of information connected to different types of services varies, e.g.: video services require very large capacity compared with SMS. For video related services the span is large (broadcast quality TV: 6Mbit/s, VHS quality video(MPEG1): 1,5 Mbit/s, Video: PDA ,320*240 pixel: 0,7 Mbit/s, Video: Moderate motion (about 1 image/s): 300 kbit/s, Video: Very little motion (<<1 image/s): about 100 kbit/s, Videoconference : 64 - 384 kbit/s, Videoconference (model based coding): 20 kbit/s, Animations: about 20 kbit/s, Synthesized image: about 10 kbit/s). This part of the study connects the emerging consumption of these and other services to technology and capacity (e.g. does mobile TV over HSDPA provide enough capacity to meet emerging consumption patterns?), making technology the dependent variable.
Studies of potential market positioning strategies of industry actors on the emerging market for mobile TV services: The outcome of industry strategy studies includes a set of potential market positioning scenarios, encompassing technology suppliers, content providers, broadcast actors and service operators. The ambition should be to link the short, medium and long-term scenarios to the studies outlined above. (For simplicity, focus will in the first phase be on the Scandinavian market.)
Linking the studies in order to outline a set of suggestions for future, focused in-depth studies: Two underlying aims will guide the final part of the project:
Firstly, to link the three previous studies, testing the possibilities to establish integrated techno-economic studies in the area of wireless services and technologies, and
Secondly, to outline a set of proposals for future research in the area of mobile TV and multimedia services and technologies. The studies will include analyses and discussions of both potential and existing technical solutions.
The studies will be performed in joint cooperation between CIC at Stockholm School of Economics (SSE) and Wireless@KTH. CIC with Wireless@KTH will jointly be responsible for outlining the studies of the project.
a.How does these match the objectives of the research program?
A predicted result of the suggested project is the strengthening of intra-disciplinary and inter-disciplinary research activities in the wireless area. The aim is to create a project that connects KTH and SSE research strengths (technology and economy), running cross-disciplinary research projects in cooperation with industry partners, and between academic institutions. Mobile TV services and technologies have a large potential impact on future wireless systems, and both ICT industry and media industry development. We believe that increased insights into these new technologies and a selection of service application areas are of common interest to SSE and KTH researchers, and to industry partners in supplier and user related industries.
b.Are the resources planned adequate to achieve the objectives ?
The main empirical work will be perfomed by SSE and KTH researchers, including students (“ex-jobb”). Per Andersson and Christopher Rosenqvist will act as SSE research leaders (part time) in the project. Wireless@KTH will act as research coordinator jointly with SSE in project. Main participants from Wireless@KTH will be Östen Mäkitalo and Aurelian Bria.(See biographical nptes on Per Andersson, Christopher Rosenqvist and Östen Mäkitalo below.)
2.What is the potential to spawn a Wireless@KTH-project? One of the aims is to investigate the possibilities to create research projects with a combined technology and economy research focus, using the experiences from the study when outlining similar future, tele-economic research projects.
a.Which partners have been identified for cooperation? Are any partners involved already at this stage ?
Already now, the ongoing project is based on contacts with actors that can be involved in the planned empirical studies, for example: TeliaSonera, MTG, Bonniers, Kanal 5, SVT. Contacts will also be taken with technology suppliers. Already at this stage, CIC have established contacts with companies in the media sector. Contacts are being taken in June 2006 with potential sponsors/contact persons. (Great interest has been shown and formal support is expected.)
b.Are there any EU-programs that could be addressed at the conclusion of the project ?
ECOSYS is one potential EU based program that could be approached for additional, future funding.
c.Could this project attract new Wireless@KTH-partners ?
The project might attract new partners from the media sector (see above)
3.Which scientists are involved in the project? Center for Information and Communications (CIC) at Stockholm School of Economics is founded on over ten years of business research in the general area of ICTs and mobile technologies. CIC’s international activities include a central role in the Global Mobility Roundtable. The Roundtable is a series of global conferences on mobile communication and computing, organized by an international group of visionary researchers and practitioners. The meetings provide an opportunity for researchers and business leaders to benefit from discussions on the latest innovations in mobile technologies and analyses of their business applications. In addition, CIC actively coordinates researchers and business leaders also through a series of recurrent, seminars in the CIC Open Seminar series. The aim is to use these two platforms for diffusion of research results from the proposed project.
Per Andersson is Associate Professor at the Center for Information and Communication (CIC) at Stockholm School of Economics. Since 1993, he has participated in a number of research projects on the mobile communications, resulting in a number of published articles in journals, conference proceedings and books. These projects took a new turn in 1996, focusing on the user organizations and with a particular focus on developing the term ”mobility” (including ”mobile organizations”). A recent project examines how firms and other organisations co-produce and create values from new mobile technologies and applications. This research is done against the background of the growing importance of the market for wireless services and applications for enterprise customers. The aim of the project is to analyse processes of value creation in this emerging market. In focus are co-production processes, in the context of specific mobility offerings provided by emerging value constellations of firms.
Östen Mäkitalo is guest professor at KTH since 2004. He has been with TeliaSonera and its predesessors until August 2005 as Senior Vice President Mobile Products and Services, CTO and President of Telia Research. Mäkitalo has actively been involved in the development of most of the present standards in radio communication and broadcasting. At Wireless@KTH Mäkitalo is managing and doing techno-economic research, e.g. on the impact of new technology and possible business models and business roles for future mobile communications systems.
Christopher Rosenqvist is Assistant Professor at the Center for Information and Communication (CIC) at Stockholm School of Economics. Since, 1996 he has participated in a number of research projects within the field of media product development. After completing his Ph. D thesis at the Royal Institute of Technology he joined the Stenbeck Group (Metro, MTG, Tele2). In 2003, he returned to the academia and became responsible for the Media Management education at Stockholm School of Economics. His research interest lies in the field of customer oriented product development, more specifically to help media corporations to react faster to market changes and seize business opportunities.
Aurelian Bria is Ph.D. Student in Mobile Communications, KTH, since Sept. 2000, and was guest researcher in Interactive Institute Stockholm, Smart Studio until Dec 1999. Aurelian had an Internship at Ericsson Eurolab Deutschland – on the project Future Radio Access Networks, June-Sept. 2002 and was guest researcher in CID (Center for user-oriented IT design) in NADA Department – KTH University Stockholm November 1998 – Dec 1999. AREAS OF INTEREST are Mobile Communication Networks and Project Management. Aurelian has a Postgraduate Master degree in Mobile Communications – POLITEHNICA University of Bucharest
4.Which GST PhD students are planned to be involved in the project ? The project will involve students from both KTH and Stockholm School of Eonomics, some selected from the joint KTH/SSE programme “Business Development and Media”. For the moment, PhD students are mainly from the SSE sphere, but we would welcome any KTH phD students that would like to participate.
5.Which previous “Small projects” have the applicants been involved in ? None of the “small projects”. However, CIC has been involved in other ongoing research projects at Wireless@KTH.
Work Plan and Preliminary Budget
A tentative work plan for the proposed research project for the period October 2006 - June 2007:
Step 1: Oct-Nov 2006 Empirical data collection S1 and S2, S3: pre-studies
Step 2: Dec-Jan 2006 Analyses and draft proposals S1 and S2, S3: outline of S3 analyses