Picture This

Bye Bye, iPod?

3/30/2007 6:08 AM

Sixteen months ago in this space, I praised Apple’s video iPod as the biggest innovation in portable video technology. Consumers could watch episodes of Desperate Housewives and Lost on a clear, 2.5-inch screen while riding the bus home from work or waiting endlessly for your number to be called at the Motor Vehicle Bureau.

Fast forward to today, and the iPod is even more valuable. Consumers can now download to the player full-length movies, as well as hundreds of shows from cable and broadcast networks.

And yet the video iPod seems so yesterday. That’s because a new generation of video phones now allows consumers to watch live broadcast- and cable-network shows, sporting events and movies in real time, not on a “time-shifted” — or delayed — basis. Right now, most of the mobile-video offerings are short two- to three-minute vignettes from popular shows such as Comedy Central’s Mind of Mencia or video footage of the latest Midwest tornado strike from The Weather Channel.

Now, telephone companies such as Verizon Wireless and AT&T will allow you to watch Jack Bauer save the world on 24 in real time while commuting home on the train. You don’t have to wait until the next day to download it off iTunes to your iPod.

Verizon and AT&T are quickly dialing up cable networks to secure video-streaming rights to their product in an effort to entice viewers to buy their service. Both have gotten together with Qualcomm’s MediaFlo service to provide streaming signals to their cell-phone customers from such well-known brands as ESPN, MTV, Comedy Central, CBS and Fox.

Other start-up companies such as mobile-TV venture Modeo are trying to break into the business with its own stand-alone mobile-phone-video service. Modeo carries the live feed from Fox News, CNBC and MSNBC, but it has yet to secure a carriage deal with a wireless-phone company.

And if that isn’t enough, MobiTV CEO Phillip Alvelda said during last week’s CTIA Wireless 2007 convention that the company is developing a way for cable operators to let subscribers stream programming stored on their digital-video recorders to mobile phones. That service could prove to be a major selling point for the joint Sprint Nextel/cable-operator mobile-wireless service called Pivot.

The thinking is that watching the Michigan-Ohio State college football game live on ESPN or Chris Matthews play hardball against conservative politicians on MSNBC will boost interest in video. So far, that’s been a sluggish business for mobile-network operators.

According to online publication Business 2.0 Magazine, only 2.5% of the 5.3 million U.S. wireless subscribers pay in the neighborhood of $15 prt month to watch short video clips.

The multimillion-dollar question is: Will consumers watch appointment television on a two-inch screen? Will consumers – who already use their phones to text-message their best friends, check e-mail from their boo and download the latest Justin Timberlake ring tone – want to trade in their LG Chocolate wireless phone for a video-ready receiver that might not be as cool?

Will they want to pay an extra $15 per month or more to watch a streamed episode of CSI: Miami on their cell phone while shopping for Cheerios at Stop N’ Shop?

For content providers, mobile TV is just another platform to maximize reach and revenue for their programming without cannibalizing their more lucrative cable business.

But for telcos – which are putting millions of dollars to build the infrastructure to offer live video to consumers and then to secure content for the service – it’s a huge gamble.

But one that’s worth taking. Apple has shown that busy consumers are willing to pay $1.99 to download episodes of The Office or Battlestar Galactica to their video iPods, so it’s not too far a stretch to believe that many would be willing to watch those same programs via alive stream on an even smaller wireless-phone screen.

At least for weary, daily commuters like myself, a cell phone with live TV could eventually trump the video iPod. As long as the wife or kids don’t call while I’m watching the football game.