Maybe FLO TV didn’t die in vain, after all: In its new global entertainment and media outlook report, PricewaterhouseCoopers predicts that mobile TV subscription revenue will grow at a compound annual growth rate of 13 percent over the next five years in the U.S. That means mobile subscriptions will bring in $900 million of revenue by 2015, compared with $486 million in 2010.
This would be a small but notable recovery for a sector that has had trouble catching on with consumers and that actually saw revenue declining two straight years in a row after peaking at $522 million in 2008. PwC forecasts that those losses will level off this year, with revenue staying at $486 million and growth returning to the sector in 2012.
Granted, we are still talking about a market that is pretty small overall, only catering to 5 million paying subscribers by 2015 (up from 2.7 million in 2010). However, there could be a bigger story behind these numbers: Past mobile TV efforts, like Qualcomm’s (s QCOM) now-defunct FLO TV service, were based on subscription-only offerings. PwC predicts that mobile TV will mostly be free, with only a smaller subset of viewers subscribing to extended premium offerings. From the report:
We expect mobile television to be offered principally as a free service for standard television programming. We also expect that specialized content, such as live broadcasts of sporting events or the availability of movies from premium television channels, will become an appealing application that would command a subscription fee, although we do not expect such models to generate significant interest for at least the next few years.
In other words: Mobile TV may not be a subscription gold mine for the next few years, but the fact that subscription revenue is projected to double in four years could be the sign of a much wider adoption of free and ad-supported mobile TV offerings. PwC predicts that this uptake will be driven by wireless network upgrades and a mobile DTV standard, which could kick in by 2012 or 2013.