Six weeks before year-end, the mobile broadcast TV services we were promised for 2006 are nowhere to be seen. Qualcomm made a big splash with the citywide coverage of its Forward Link Only, or FLO, technology last spring during CTIA and the National Association of Broadcasters conferences. But since then, not a peep has been heard about a commercial launch or even a commercial trial of its MediaFLO service.

Meanwhile, Crown Castle's Houston trial of a digital video broadcast-hand-held (DVB-H) network has taken place, yet its promised 2006 commercial launch of Modeo has yet to emerge. However, at Crown Castle's Q3 earnings call, CEO John Kelly committed to having Modeo running in New York by the new year. And the latest entrant in the game, Aloha Partners' HiWire, said it would launch its first trial in Las Vegas using T-Mobile as its guinea pig.

Otherwise, the three announced providers of multicast mobile video services are remaining mum, some for competitive reasons — anything MediaFLO does publicly is essentially an announcement of the TV strategy of its exclusive partner Verizon Wireless. But they've all found themselves dealing with the peculiarities of their individual spectrum, which may be delaying their launches. Both Qualcomm and HiWire own 700 MHz UHF spectrum, a band still occupied by traditional TV broadcasters. Although the FCC has set a 2009 deadline for those broadcasters to vacate the band, Qualcomm and HiWire obviously want to launch commercially in less than two years, which brings interference issues up among the spectrum holders.

Modeo has interference problems of its own, though of a different nature. It's petitioning the FCC to allow it to boost the power at which it can transmit over its 1.6 GHz spectrum, or at least re-evaluate the way it measures power output. By measuring the average power over its entire swathe of spectrum rather than the total aggregate power, Crown Castle could boost the wattage of its system to get far larger sales, possibly cutting the number of transmission towers it needs to blanket the top 150 U.S. markets by half.

Qualcomm has gotten some relief from the FCC, which last month agreed to give the operator some leeway in interfering with broadcaster's UHF bands. The commission set a benchmark allowing for 0.5% interference from FLO in the first year, and 1.5% interference in 2008, after which the broadcasters will be forced to move to new digital frequencies. Though the ruling wasn't everything Qualcomm wanted, it could be the leeway Qualcomm needed to begin commercial launches with Verizon Wireless in the coming months, said Ranjan Mishra, analyst for Mercer Management Consulting.

“If Qualcomm is the early mover, it will certainly have some advantage,” Mishra said. “But the early mover also has the burden of making the case for the technology. Skepticism has already been building in the market for mobile TV. They have to overcome it.”

If Qualcomm does get a commercial network operational by the end of the year or early 2007, it doesn't mean Modeo and HiWire will continue to putter around in New York and Las Vegas. In fact, a major market launch of multicast TV by Verizon Wireless could be the catalyst necessary to bring all of these networks to life, said Yoram Solomon, president of the Mobile DTV Alliance, an industry group founded to promote DVB-H in the U.S.

“I would love it if Verizon launched [MediaFLO] tomorrow,” Solomon said. “It would force Cingular to jump into the market. Verizon Wireless has a one-year exclusivity agreement with Qualcomm, but there's nothing to prevent Cingular or T-Mobile from signing up with Modeo or HiWire.”

When all three multicast providers hit the market, it will start to get interesting, Solomon said. Right now, there's no demand for mobile TV services, and even as consumers are educated on the service, initial demand for mobile TV won't be enough to support the billions in capital expenditures that Qualcomm, Crown Castle and Aloha Partners are paying for their networks. Supposing that carriers charge $20 per month for the typical multichannel package, anywhere from $12 to $15 of that fee goes back to MediaFLO, Modeo or HiWire. Of those gross revenues, half or more will go to the content providers. Then subtract regular opex costs, and they're likely left with about $2 per subscriber in operational profit. Assuming that each provider's network costs about $1 billion to build, each operator would need 40 million subscribers to be profitable in a year, Solomon said.

Considering there are only 200 million mobile subscribers in the U.S., those kind of numbers will be hard to hit for one provider, to say nothing of all three. The three may eventually find themselves splitting up among different markets or splitting their channels, so multiple providers sell to the same operator, Solomon said. But initially all three will try to go head-to-head selling the same content in the same markets, Solomon said: “It will be a dogfight.”