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Startups Make the Case for Mobile TV

Carmen Nobel
News Analysis
Carmen Nobel
4/28/2006

The business of delivering TV programs to mobile devices got a little more interesting this week: Armed with a swath of spectrum, another player entered the mobile broadcast fray. But are separate networks dedicated to mobile TV really worth it? Most carriers have yet to make the plunge.

The new player, HiWire Mobile, is an asset marriage between spectrum owner Aloha Partners LP and satellite operator SES Americom , a division of SES S.A. (Paris: SESG). Aloha owns 12 MHz worth of U.S. spectrum, while SES operates 43 satellites worldwide, 17 in the U.S.

HiWire plans to launch a broadcast trial in Las Vegas this fall with up to 40 mobile TV channels -- first with a technical trial and then with a customer trial by December, says Scott Wills, president and chief operating officer of HiWire. The company plans to announce a carrier partner before the trial.

"Our business depends on carriers in the long run," Wills says. "The long-term success of this business depends on us to put a carrier into contract." He declines to say whether any carrier has signed with HiWire.

HiWire competes in the U.S. against two players, neither of which have launched yet, but both of which share HiWire's notion that wireless carriers don't have networks suitable for broadcasts.

"The carriers have spent a lot of money developing sophisticated 3G networks, but those networks are not suited for delivering high bit-rate television," Wills says. "They're designed on a point-to-point basis. They're designed for you to call me."

One competitor is Modeo LLC , which plans to launch services in several markets, including New York, by the end of the year, although it has yet to announce a carrier partner. Modeo, formerly known as Crown Castle, owns 5 MHz of spectrum in the 1670 to 1675MHz range. Like Modeo, HiWire plans to use DVB-H technology. DVB-H is an IP datacasting technology that has the support of Texas Instruments Inc. (NYSE: TXN) and Nokia Corp. (NYSE: NOK) -- it also has passed muster with European Telecommunications Standards Institute (ETSI) .

The other competitor is Qualcomm Inc. (Nasdaq: QCOM) Qualcomm owns and runs MediaFLO USA, which will run its service across 6 MHz of bandwidth in the 700MHz range, on UHF channel 55. Qualcomm has secured a major carrier, Verizon Wireless , which plans to roll out MediaFLO service in spring 2007. Like MediaFLO, HiWire operates in the 700MHz band, which is where Aloha's spectrum lives. Both Qualcomm and HiWire argue that their spectrum is better than Modeo's because it operates at a lower frequency.

"Now that we have 700 MHz and Qualcomm has 700 MHz, it's not just about the spectrum, it's about the bandwidth," Wills says. "We have twice as much bandwidth as MediaFLO."

Having two competing technologies on the same frequencies has some of the elements of a good novel," he says.

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