the space is inspiring. Market watchers Ovum estimate that there are in excess of 600,000 subscribers to paid mobile TV services on the largely Korean standard DMB, and more than one million subscribers to the free-to-air Satellite-DMB mobile TV service. Nokia’s Lipiainen notes that Korean mobile TV watchers are already racking up more than an hour a day.
But mobile TV, like any application, needs scale to have a true impact on the market, and whatever incubation attributes Hong Kong has, the promise of market scale isn’t one of them. Neither, ultimately, does Korea, and as Motorola’s Chapman-Banks points out, “We are excited by Korea, and everything in the mobile TV world works there, but you can’t apply it anywhere else; there are too many Korea-specific technologies, regulations, and business practices.” The same charge can be leveled at Japan. So, inevitably, the mobile TV market refo-cuses its attention on the market that matters. “China is going to shape our destiny,” he says, speaking about the mobile TV industry at large, but certainly China shapes Hong Kong’s entire destiny. China’s mobile market already is having a huge impact on Greater China’s multimedia industry. Chapman-Banks notes that Taiwanese pop-rock sensation Jay Chou made more money selling music clips and ring tones off a ten-day, mobile-phone-based promotion in China than he accrued in total sales of his last album. Unfortunately, despite increasing movement of carriers and companies across the borders, there is little integration of Hong Kong’s mobile industry with China’s, and despite the zest that China’s 450 million mobile subscribers bring to the world’s cellular industry, mobile TV development there is likely very far behind the curve.
I say this in spite of mounting evidence to the contrary. Government and industry are keen to get a service up and running for the 2008 Olympics, and (other) market watchers In-Stat earlier this year put out a report predicting 94 million mobile TV users in China by 2009. There’s one problem with this optimism. As I’ve often pointed out, China’s
broadcasting industry is governed–in both the operational and regulatory senses–by a separate government body than that which oversees telecoms, and that body has little interest in cooperating with the telecom industry and strict control over the types of content that is created and broadcast. Broadcasting is very, very different in China, and the Chinese government’s micro-manage-ment of content distribution means that plain old television broadcasting content is relatively thin and generally of middling quality. Even if the broadcasting regulator took a more pro-telecom view, there would still be little depth of available content.
Virtually There
Thus, it was with some cynicism that I listened to the promise of mobile television in Hong Kong being boosted time and again throughout the day. And then
I heard a small voice beside me whisper: “Do you know what the real problem with the mobile TV industry is?” My heart lightened, for in my experience, the type of person who is motivated to ask such a question always has an interesting answer, and usually one that is better than mine, which is “the bells-and-whis-tles fetishes of industry professionals.” Before I had a chance to utter such heresy, the owner of the whisper, one Vincent Phan, whispered again: “Screens.”
Vincent is President of VP Dynamics Labs, a small Hong Kong technology firm that develops display technology for mobile phone screens, and he is convinced that mobile TV is not going to be a mass phenomenon until most phones in the marketplace are capable of displaying broadcast-quality images. “Most 2-inch screens offer too low resolution, and smartphones are very expensive,” Phan continues, while dipping into his briefcase and pulling out marketing material
with the reverence of someone about to reveal a deeper truth. Most phone displays have 20,000 to 40,000 RGB pixels– less than 10 percent of what is required to produce VGA-level resolution. While smartphones typically do better, there are the added elements of display component costs and power consumption. The former slims down mobile TV’s market reach; the latter curtails the consumer’s viewing time.
VP Dynamics looked at resolving this, not through bulking up display technology, but by stripping it down based on a consumer’s real ability to process visual information. “Our research began with the human eye, not display technology. We realized that people really cannot distinguish 75 percent of the color shades on displays sized for mobile, so we looked at ways of eliminating pixels and ‘tricking’ the eye into seeing more colors than were there,” says Phan. The result is Virtual Resolution, a pixilation algorithm that actually uses more white space and combinations of fewer pixels to simulate the overlap of neighboring pixels. “We reduce the pixel count by two thirds, bringing screen brightness up by a factor of three, and power consumption down by half.” Phan is selling his algorithms into Taiwan’s mobile OEM space, and in this, VP Dynamics has become that rare thing that the HKWTIA craves–a local company that leverages its position in greater China’s mobile ecosystem to success. And what’s keeping VP Dynamics in Hong Kong rather than relocating to Taiwan, where the majority of the world’s mobile displays are made? “Two things: political stability and access to freely convertible currency. Taiwan may have technology, but without these two things, I can’t do business.” And with that, Phan proved to me that there is hope for Hong Kong’s mobile TV industry–just for reasons that have nothing to do with either mobiles or TV. V
Ross O’Brien, our Asia/Pacific Editor, is a long-time telecom analyst, consultant, writer, and speaker who regularly appears on CNBC and CNN. He is headquartered in Hong Kong. You can reach him at robrien@vonmag.com.
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