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Entertainment firms bet that parents will buy mobile television for children

When a toddler's wails soar to piercing volume, do you shake the baby rattle or dangle the mobile phone?

An unlikely group of entertainment companies is betting on the mobile phone. The target customers are children who may be incapable of coherent telephone conversation but will cuddle with a portable phone to watch Ernie deliver an ode to his chubby rubber ducky.

All the giants in children's entertainment are rushing to develop programming that fits in a pocket.

The Walt Disney Co and Warner Brothers, which is owned by Time Warner Inc, are developing "mobi-toons" for third-generation portable phones that can double as mini-televisions.

The creator of Teletubbies, Anne Wood, is striking alliances with global broadcasters like the BBC and is searching for nine more international partners to create Tronjis, a children's show created to be distributed on television, telephones, game handsets and the Web.

On the French Riviera last week, television executives from around the world crowded into a mobile television seminar to gaze at a giant screen view of the late Ray Charles serenading Ernie of Sesame Street from the frame of a mobile phone.

J. Paul Marcum, Sesame Street's general manager for its interactive group, came to the annual MIPTV international television conference in Cannes as part of a vanguard of producers to trade information about a format so new that no one is sure how business models will evolve.

Sesame Street, he said, is one of the first children's entertainment companies to start offering phone fare, through an alliance struck last month with Verizon in the US to offer some of its classics through a US$15-a-month wireless broadband service called V Cast.

"It's certainly not like we're advocating selling phones to preschoolers," Marcum said. "But you can't ignore the convenience factor when people are in motion. A parent can pass back a telephone to the kids in the back of the car. And it's a device that families are going to carry with them everywhere."

The potential for this type of mini-entertainment is high but unpredictable, because telecom and television executives do not know yet whether subscriptions or advertising will be the main source of revenue. In a report issued this month, ABI Research, a technology market research company in Oyster Bay, New York, estimated that mobile television is a US$200 million-a-year business that will grow to US$27 billion by the end of this decade, with more than 250 million customers subscribing to entertainment services.

South Korea is becoming the world's laboratory with the start of a mobile network, Digital Multimedia Broadcasting, a system that will also be tested in Germany in advance of the next World Cup.

Next month, the new satellite network will start transmitting 14 video and 24 audio channels to phone customers for monthly subscriptions of US$12.40.

In tests this year, 13,000 customers signed up for the service, and now the South Korean government's research arm, ETRI, is saying that network subscribers could grow to 11 million by 2010.

"They are pretty much driving the development," said Ken Hyers, author of the ABI report. "It's great for the operators in the world to see what works and what doesn't in Korea."

He added that early trials had shown that "not many people are going to want to sit there and watch something for more than four or five to 10 minutes. No one is going to watch Gone With the Wind on their phone."

To test the personal appeal of mini-entertainment, Hyers turned to his own children, ages 3 and 5. He downloaded movie trailers for Harry Potter and Finding Nemo to a personal device and passed them the little screen. "They watched it over and over," Hyers said.
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