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Update on mobile TV in Korea

Posted: December 21st, 2007, by Yunho Chung

TU Media has been able to acquire the simultaneous re-transmission rights from MBC according to an interesting article I just read. This represents a big step for TU Media but it comes two and a half years too late.

As TU Media started operations in mid 2005 it tried to acquire simultaneous re-transmission rights from broadcasters. This means that S-DMB viewers would be able to watch popular dramas and shows simultaneously with fixed TV. These contents are considered the most popular on both fixed and mobile TV. However, previously have broadcasters been reluctant to share these contents because they wanted to use it for their own T-DMB service. This is why S-DMB had to focus on other contents like sports and news. But the lack of “killer” contents from fixed TV hindered S-DMB development (as shown in the graphic above). Until today it had been able to acquire approximately 1.26 million subscribers. But according to TU Media they need approximately 2.5 million subscribers to be profitable. As a result, as reported two weeks ago, SK Telecom is thinking about limiting its involvement in TU Media.

But also T-DMB is struggling to build a profitable business. Despite more than seven million T-DMB devices in Korea the advertising revenues are marginal. Which partially is the result of very restrictive legislation on advertising but also broadcasters have failed to develop an attractive mobile advertising value proposition to make this channel more attractive for advertisers.

Experts are blaming policy for allowing two different mobile TV standards and businesses. Their competition was one of the main obstacles that mobile TV could not develop its full potential. So is mobile TV doomed in Korea? I do not think so, because consumers have embraced this new medium and it is very likely that broadcasters will take mobile TV more serious and endeavor to make mobile TV advertising more attractive for broadcasters. Until 2012 more than 20 million T-DMB devices are expected, so mobile TV has a future in Korea. In these days I am finalizing the mobile TV report I have been working on recently, so if you are interested in a more in-depth analysis of the Korean mobile TV market let me know. I am eager to share it with everybody who might be interested.

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