The world is becoming more mobile as populations demand continuous access to content for business and for pleasure. This increased desire for mobility presents strong opportunities for satellite players in Asia, and many
companies already are involved in ambitious projects aimed at making strong mobile video offerings a reality for customers.
The world is entering a new era in terms of how video content is consumed, with customers increasingly finding new ways to watch their favorite shows and no longer tied to the TV in their homes. Whether it is watching a show while travelling or when taking a break from work, it seems everyone is demanding constant access to video content.
In Asia, home to some of the biggest markets in terms of population, there already is a recognition of these trends and operators are providing mobile broadcasting services to meet strong customer demand. Mobile broadcasting is making a splash in South Korea, and with other countries planning or testing systems, Asia could quickly become one of the leaders in terms of innovative mobile video services. While the mobile video space is relatively new, it is an exciting, vibrant area that could offer strong revenue opportunities for satellite players. 

2008 Olympics Providing Spark In China

In China, a mobile video solution is slated be launched prior to the Beijing Olympics, and satellites will play a prominent role in the system. Earlier this year, China Satellite Mobile Broadcast, a company held under the Wireless Bureau of China’s State Administration of Radio, Film and TV (SARFT), selected EchoStar subsidiary CMBSat of Hong Kong to be the primary provider of S-band capacity for China’s mobile video project. “The CMBStar satellite will provide complete coverage of China for SARFT’s CMMB (China Multimedia Mobile Broadcasting) project,” Dave Shull, the CEO of CMBSat, says. “Once the satellite is launched in mid-2008, you will be able to immediately see SARFT’s mobile multimedia broadcasting channels of video, audio, and data nationwide. For hundreds of thousands of villages in China,  this crystal clear digital signal will be the most reliable way for them to receive the national cultural and information services provided by CCTV and other content partners.”
With the Beijing Olympics slated to begin in August 2008, the clock is ticking, but Shull believes development of the service is on track. “In October, SARFT appointed STiMi (Satellite Terrestrial Interactive Multi-service) as the industrial standard for mobile multimedia broadcasting,” he says. “We have reviewed this Chinese-developed standard and are impressed by its technical performance. With the combination of scale and solid technical standards, China will take a very strong position in mobile video worldwide. … SARFT [has] demonstrated working chipsets, handsets, and terrestrial gap fillers for the STiMi standard. Between now and the Olympics, the CMMB working groups will move aggressively to industrialize these products and deploy them more broadly throughout China.”
Kirby Ikin, managing director of Asia Pacific Aerospace Consultants, sees China as a prime example of how satellites can make a huge impact in the mobile video space. “From a global base of about 2.5 million mobile TV subscribers in 2006, there are estimates that this market will expand to as many as 210 million subscribers by 2011,” he says. “The market in Asia will play a significant role in this growth. Asia has been a leader in the mobile services area with the mobile telephony satellites ACeS Garuda and Thuraya and the introduction of mobile TV via the MBSat satellite. These trends are being watched all over Asia, and there will be opportunities across Asia in the mobile services market.”

Varying Stages Of Development

South Korea houses one of the most innovative satellite mobile players in the world in TU Media, which offers 15 video channels and 19 audio channels of content via satellite–digital multimedia broadcasting (S-DMB). TU Media has nearly 1.2 million subscribers and hopes to have 2 million by the end of 2007. The operator will need 2.5 million subscribers to be profitable and expects to reach this milestone in 2008, says Soon-Kyoo Kang, vice president of TU Media, but the operator already faces stiff competition from a rival offering mobile services via terrestrial means. To combat this, TU Media launched T-Commerce services in March and also plans to introduce new data broadcasting services later this year.
Japan is one of the largest markets in Asia and also is one of the world’s most innovative wireless markets, with NTT DoCoMo seen as one of the most progressive operators around the globe. Against that backdrop, the opportunity for satellite players in the mobile market is not easy to define. However, there have been significant recent market developments.
Satellite operator JSAT and pay-TV operator Sky Perfect have established a joint holding company, Sky Perfect JSAT, to work together to develop new markets for satellite services, including mobile. Tomonari Niimoto, general manager of investor relations for Sky Perfect,  says the companies have developed a mid-term management plan, and one of the priorities is to penetrate the mobile market and improve performance. “For mobile, we are planning to get 1.3 million [Internet protocol] and/or mobile subscribers by 2011,” he says. “For the mobile market, we are looking at [Internet protocol]-based transmission of content. The other thing we are looking at is remote transmission of content. If someone is subscribing to the Sky Perfect TV service, they can view the TV content they pay for on any device, such as a mobile phone.”
Astro All Asia Networks, a direct-to-home player operating mainly in the Malaysian market, also is looking to take advantage of opportunities in the mobile space. Graham Stephens, Astro’s CTO, says the operator is providing content and expertise to Maxis Communications, which is rolling out a trial mobile TV service in Kuala Lumpur using the digital video broadcasting-handheld (DVB-H) standard. This trial uses UHF spectrum allocated to Measat Broadcast Network Systems, a wholly owned subsidiary of Astro.
“The trial is important to us in order to determine the cost of providing adequate coverage in difficult urban areas,” says Stephens. DVB-H offers the ability to cover rural communities via S-band and, in conjunction with affiliate Measat Satellite Systems, Astro will study how to implement this system. “However, the initial rollout will be via a terrestrial network, and it is important to establish the planning parameters that provide optimum coverage at minimum cost. Early implementations of DVB-H have opted for the ‘high-broadcast site, high-power transmitter’ approach with many gap filler repeaters, but there is an alternative approach of using ‘high-cellular sites’ in a more cellular-like coverage pattern.”
While the trial will be launched with a terrestrial system, Stephens believes satellites will play a critical role in developing mobile video markets in Asia, playing a primary role in rural areas and a secondary role in urban areas, “which is where the initial market is,” he says. “Satellite technology is excellent for secondary distribution from the headend to semi-rural transmitter sites, and it is naturally suited as a means of distribution to multiple terrestrial transmitters operating as a single frequency network where signal timing is critical. However, operators may still favor fiber distribution to urban transmitters in order to avoid issues of solar outage and rain fading. This is a particular issue here in Malaysia. The optimum approach might be to combine the natural robustness of satellite-based network distribution with a fiber backup to the most important transmitter sites. But this belt-and-braces approach may be too costly to implement at service launch, so our trial is utilizing three different distribution mechanisms simultaneously -— fiber, terrestrial microwave and satellite.”
In terms of how the mobile landscape will develop in Asia, Shull says, “In the next 12 months, I expect that we will see continued rapid growth by TU Media in Korea and final preparations by CMMB for a Beijing Olympics launch. I expect that continued success on these two fronts will increase the momentum for paid mobile video services and increase the demand for hybrid satellite-terrestrial systems such as S-TiMi and S-DMB. Additionally, we would expect to see a number of other deals announced for mobile video deals announced in Asia in the next 12 to 18 months.”

FSS Opportunity May Be Limited

With the demand for mobile services likely to be strong, there should be opportunities for Fixed Satellite Services players, but Peter Jackson, CEO of AsiaSat, sees S-band as a limited opportunity due to cellular coverage becoming more widespread throughout Asia. “We are presently witnessing the increasing geographic coverage of cellular telephone coverage, and in some countries, the mobile operators are extending the coverage to the very rural areas as they see this as a large growth opportunity,” he says. “… I am of the opinion that video to a handheld can be offered easier by a cellular [operator] than by a satellite operator. I am not saying that a terrestrial network is better than a satellite for distributing common broadcast video content over a very wide area — obviously, satellite is superior, but I think the satellite should just be a link in the delivery network of a mobile system. The S-band frequency is a very useful satellite frequency, but I am not sure using it to deliver video to handhelds from a satellite will give you a viable business model in Asia if you are competing with a cellular operator.”
But Jackson does see an opportunity for satellite operators. “Rolling out S- or L-band distribution in cities requires heavy capital expenditure to provide gap fillers on top of the dedicated satellite,” he says. “In the developing countries in Asia, most of the people that can afford such a service live in towns and cities. Once you move out into the urban areas I think is it doubtful that a lot of the population would be prepared to pay for such a mobile service, and if we are therefore looking at a predominantly urban service, why build a very expensive satellite that is only good at delivering service to the rural areas?”
Ikin says it is “highly likely” that other mobile television services based on S-DMB will emerge in Asia. “The levels of network infrastructure, however, differ significantly around different parts of the Asian region, and hence satellite services are more likely to find favor in the countries where terrestrial infrastructure is lacking or more expensive to install. Satellites also represent a quicker and more cost-effective method of covering large areas of Asia than building a new terrestrial network capable of delivering mobile television. Given the uneven levels of existing infrastructure around the region there are probably more opportunities for mobile and satellite in Asia than in Europe.”
While there will be growth in the mobile satellite services market, it is difficult to foresee how it will take shape, Ikin says. “TV viewers are now exposed to [Internet protocol] TV, time shifting, video on demand and growing interactivity, while growing broadband penetration is also shaping people’s perceptions. These factors will undoubtedly shape the mobile satellite services landscape in the next twelve months and beyond. It is likely that the next 12 months will see serious consideration of new mobile satellite services over Asia following the examples of systems being used in Japan and Korea as well as the new initiatives in the U.S. and Europe.”