Japanese TV phones click well, but don't rake it in yet

TOKYO: The 53-year-old managing director at an investment firm bought it so he could watch business news, follow his baseball team and tune in to the World Cup — whether he’s on a business trip or out drinking with friends. “It really is very good. The only trouble I have is that every so often I watch too long and end up with a dead battery. That’s why I carry a second phone around with me now,” he said.

Many analysts predict rapid growth for TV cellphones. Devices like car navigation systems and Nintendo’s DS portable game player will also come equipped for the service.Those looking to profit range from top mobile phone operator NTT DoCoMo to digital entertainment companies such as Index Holdings but it remains to be seen whether the market becomes a huge money maker or a niche market.

Research firm Gartner predicts mobile video and TV services will be adopted by at least 10% of wireless subscribers by ’09. Japan along with neighbouring South Korea are expected to be at the forefront.

Japanese cellphone users on average upgrade their cellphones every 18 months and are accustomed to using their phones for email, surfing the Net and increasingly to buy goods and services.

Unlike analog TV for mobile devices, the new service offers picture quality that is extremely clear even when the user is moving. Of course, the screen is much smaller that home TVs and constant viewing will run down your cellphone battery after around three hours.Service is available in Tokyo and other large cities.

Although mobile TV could be popular on long train commutes, it won’t help those that ride the subway where reception is poor. Programming is currently the same as regular TV broadcasts, which means it’s free. Media and analyst estimates put current digital TV cellphone shipments between 600,000 to 1 million — a market still too small to generate new advertising revenue.

Those two factors make it tough to make money. “Viable business models haven’t really appeared yet,” says Tomoyoshi Kuzushima, an information and telecommunications consultant at Nomura Research Institute. Industry hopes are pinned on TV-linked e-commerce — links that guide viewers to buy products they may see on their favorite TV shows, as well as advertising.

But substantial profits won’t be seen before 2008 when broadcasting rules change to allow specialized programming for mobile devices such as shopping channels and auctions. Kuzushima predicts Japan’s digital broadcasts will be received on some 10.8 million cellphones by 2008 but the broadcast market for mobile devices will only be worth 9.1 billion yen ($79 million).