Broadcast TV Comes to the Smartphone

But will it make money?

Not since the days of the Watchman—that fuzzy-pictured, not-quite-portable miniature TV Sony started selling in the early '80s—have consumers been able to watch real-time, local broadcast television in transit.

But with a deal between MCV (or Mobile Content Venture, a coalition of major broadcast networks that includes NBC, Fox and Telemundo) and mobile communications provider MetroPCS, that is set to change.

Under the arrangement announced Wednesday, Metro PCS-enabled smartphones equipped with a special "Dyle" app will be able to carry full local digital broadcast signals in the 14 urban markets the mobile provider serves, including New York and Los Angeles. MCV executives said the goal is to expand.

“Our vision is to have this available in every smartphone nationally,” said Erik Moreno, co-general manager of MVC and senior vp of corporate development at Fox Networks Group. “We need to do other deals … but this is great for us.”

The service will be free for MetroPCS subscribers with a Dyle-enabled phone for at least all of 2012. After that, MCV plans to charge for it.

“In 2012, the model is that we’re offering the Dyle [smartphone] app and broadcast at no incremental cost," said Salil Dalvi, co-gm of MCV and gm of Strategic Ventures at NBCUniversal. "I wouldn’t call it a promotion. We want to build the product and build the ecosystem. Then, monetization opportunities will emerge.”

Dalvi outlined three ways in which MCV might try to bring in revenue from the service: an ad-supported model in which the mobile audience is measured and ads are sold against that viewership; a subscription model in which users subscribe to the service directly; and a cable or mobile customer authentication model. In that scenario, subscribers of a given service, be it a cable company or a mobile communications provider, can log in using credentials from those services.

Fox’s Moreno acknowledged that MCV is talking to other mobile providers besides Metro PCS, other broadcasters and cable providers about striking similar partnerships.

But the success of MCV’s endeavor will depend in no small part on whether the coalition of broadcasters can sell potential partners on the financial viability of the arrangement. A major sticking point in discussions to bring linear television programming to mobile audiences has been monetization—and specifically, if the service is advertising-supported, how those mobile audiences will be measured for ad sales purposes.

Dalvi said MCV has technology that would support any of those three revenue models, including the ad-supported system requiring audience measurement, but declined to outline specific revenue plans. 

“All those capabilities are in place. [But] it is a little premature to talk about monetization,” he said. “The first priority is to build a product. Then, those monetization opportunities will emerge.”