Niclas Medman, marketing director at business unit Multimedia, Ericsson says: "Operators already have important assets in their existing networks for delivering an evolved-TV experience, and they need to ensure that these benefits are leveraged fully to capture the promising evolved-TV market. More importantly, they need to establish a sound business model and charge for the data moved on these networks in a way that meets their customers' expectations."

Medman gives some key advice on becoming a successful operator in the world of evolved TV. He talks about the importance of operators providing the right content: a mix of traditional scheduled TV programming, plus on-demand and user-generated content. And he notes that the right pricing model is also critical.

There are four main ways to finance mobile TV: a flat rate; pay-per-view; a fee for interaction such as voting or greeting; or "free TV" paid for by advertisers. These different ways of financing can be mixed. The mobile medium provides possibilities for interactive or targeted advertising, where content can be tailored to user age, gender, location or personal interests.

Upload and download
NRK, Norway's public broadcasting corporation, and Ericsson initiated a project in December 2006 with the advertising agency Proximity Worldwide to trial targeted and interactive mobile-TV advertising.

In the UK, operator 3 has started See Me TV, where users can both upload and download content. Users are charged small sums for downloads, which quickly add up to substantial revenues, while a portion of the revenues are paid to the content producers based on how often their content is downloaded. Since October 2005, See Me TV has had more than a million downloads per month.

The various methods of distribution for mobile TV also affect the different possible business models that can be used. Operators' existing mobile networks can handle TV as an additional service in the infrastructure already built up, with gradually increasing capacity for TV as they are upgraded to 3G and HSPA. Most mobile-TV services today use such existing mobile networks. Another alternative is to build a new network dedicated to TV, which can be owned by an operator or a broadcaster.

There are several examples of successful collaborations between mobile operators and broadcasters. Vodafone UK provides Sky News and Fox Sports services for USD 3 per month. For Vodafone, mobile TV is now a bigger business than ringtones, and half of its 3G customers subscribe to mobile TV. In Australia, 3 has been successful with streaming the reality-TV show Big Brother for USD 6 per month.

A consumer study by Ericsson ConsumerLab found that people are willing to pay USD 10-15 per month for mobile TV. Research company Analysys reports that a normal revenue split in a collaboration sees the broadcaster getting 50 percent, with 30 percent going to the mobile operator and 20 percent for the content provider.

"The complexity of managing the business relations related to service offerings is increasing rapidly for the telecom industry," Medman says.