Qualcomm is reconsidering the future of its mobile television business, which has not been a spectacular success, with the company saying it is not satisfied with subscriber numbers which are not nearly what they expected. The figures have never been published. Qualcomm primarily manufactures chipsets and licenses technology. Operating a mobile television network is not the core business of the company and it is considering its options.
Qualcomm subsidiary MediaFlo Technologies develops and markets the technical platform while Flo TV aggregates and delivers television programming. Qualcomm considers Flo TV to be a strategic investment and suggests that it did not intend to operate Flo TV indefinitely and always hoped to sell it.
Dr Paul Jacobs, the chairman and chief executive of Qualcomm, told analysts that the company had been “in discussions with a number of different companies” and was pleased with the level of interest and that something would happen in the next year.
Qualcomm spent around half a billion dollars acquiring spectrum in the 700MHz band vacated by broadcasters and many hundreds of millions dollars more building a wholesale mobile television network in the United States, used by AT&T and Verizon.
In the United Kingdom, Qualcomm acquired 40MHz of L-band spectrum for a relatively modest £8.3 million and while tests were conducted in Cambridge and Manchester it has yet to deploy any service. Sky was seen as a possible partner. Meanwhile, three major mobile networks are planning their own approach based on multicasting using spectrum they already own.
The model of offering subscription television channel packages has proved challenging, while consumers are increasingly viewing video on mobile devices over Wi-Fi networks, watching programming from anything from YouTube to Hulu. Furthermore, Flo TV was not available on a wide range of handsets, and not on the devices like the Apple iPhone in which customers were really interested.
Qualcomm said that the advantage of its broadcast model was that it scaled, while arguing that it was superior to other solutions, being designed specifically for mobile broadcasts. “Once we’re deployed in a market it doesn’t matter how many customer are signed up,” said Flo TV president Bill Stone. It turns out that it does matter if they do not subscribe.
With increasing demand for mobile data services, the spectrum remains a valuable asset. Qualcomm has suggested that there could be other applications for datacasting, such as the delivery of digital newspapers and magazines. That would enable Qualcomm to retain an interest in the technical platform. Alternatively, the spectrum and transmission sites could be sold or leased for other mobile data services.