China Mobile will add the China Mobile Multimedia Broadcasting (CMMB) mobile TV chip to TD-SCDMA phones in the second half of this year.
China Broadcasting Corp. and China Mobile signed earlier this year,
CMMB is China's designated home-grown mobile TV standard, developed by broadcast regulator SARFT(State Administration of Radio, Film and Television), which has built a dedicated CMMB bearer network in 180 cities.
For the next three years, only TD-SCDMA phones - sold exclusively by China Mobile - will be allowed to carry CMMB chips.
With China Mobile's aid in sales and marketing, China Broadcasting, a company set up by SARFT set up to manage the CMMB business, is aiming for 10 million users by the end of this year. It has also set a target for 50 million CMMB users in the next three years.
Against this ambitious target are the 1.5 million current users, almost all of whom are taking part in free trials. Industry sources have said that the CMMB market has shrunk rapidly since the fourth quarter of 2008 when China Broadcasting introduced a conditional access (CA) system.
Many trial users stopped using CMMB after Shanghai Handy TV, China Broadcasting's partner in Shanghai, began to charge 12 yuan ($1.76) per month for seven mobile TV channels in March. Shanghai Handy TV has gained only 10,000 subscribers in about four months.
Compared with CMMB-capable phones, analog TV phones are more popular in Shanghai because they can be used to watch TV free of charge. Shanghai Handy TV has warned users of the risks of purchasing analog TV phones, saying analog TV signals will be switched off in the near future.
Will Kong, an analyst from Shanghai-based research firm iSuppli, said that a more creative business model is needed to speed up CMMB market growth.
Indoor coverage
A problem with CMMB at present is poor indoor coverage, and in order to enhance indoor coverage China Broadcasting needs to make money from paid services, he said. According to industry sources, it costs over RMB 100 billion ($14.64 billion) to achieve 80% to 90% of indoor coverage of CMMB in the thirty-some key cities.
"Now the CMMB industrial chain is mature and CMMB operating entities are being established around the country, more rapid growth of the CMMB market needs a more creative business model. For example, the CMMB operator can ask the user to view commercials in return for watching mobile TV for free," Kong said.
China Broadcasting has announced plans to offer a proprietary CMMB channel before the end of this year and data services such as traffic information, weather forecast and stock quotes early next year. SARFT is also devising second-generation CMMB technology that enables interactive services such as video-on-demand.
Israeli-based chip designer Siano Mobile Silicon, which provides CMMB chips, expects to ship 2 million CMMB chips in the second half, according to a report by South China Morning Post. Around 1 million will be for mobile phones and netbooks, and the remainder for other devices, such as portable multimedia players (PMPs), Wang Wei, Siano's general manager for China, told SCMP.