DiBcom sees phones tapping TV networks

By Tarmo Virki

PARIS (Reuters) - Cellphones that show television programs could tap into TV broadcasting networks, cutting mobile operators out of a possibly lucrative business, the head of French mobile TV chipmaker DiBcom said on Tuesday.

South Korea's LG Electronics (066570.KS) has started selling a phone in Germany which can do just that and DiBcom Chief Executive Yannick Levy sees it as a watershed.

"We think this is going to be a trend in Europe. We think this is going to be a big thing," Levy told the Reuters Technology, Media and Telecoms Summit in Paris.

"The LG phone is going to make a big change."

Phone makers and operators are keen to tap the potentially lucrative market in TV phones, but launching the service has been delayed, partly by concerns over how to recover the cost of building new networks.

The benefit for mobile network operators of using TV networks is they can sidestep such infrastructure investment, but they also miss out on the revenues the business will generate.

STANDARD DEBATE

LG's phone uses the digital television signal broadcast for TV sets (DVB-T) ahead of roll-out of dedicated mobile TV services in the country.

This used to be impossible as DVB-T needed too much power, draining phone batteries quickly, but most hurdles have been overcome, Levy said.

DVB-T is a new standard in an already fragmented market for mobile TV.

"Mobile TV is a difficult subject because you first have to find a spectrum, adapt the law. You also need to find agreement between content providers and telco operators. This has slowed down the deployment," Levy said.

DiBcom, Finland's Nokia (NOK1V.HE) and other European industry players favor the home-grown DVB-H (Digital Video Broadcast - Handheld) standard while Asian and U.S. vendors have pushed competing technologies such as DMB and MediaFlo.

LISTING ON HOLD

Levy has said he would like to take DiBcom public by 2009, but said these plans are on hold due to financial market turmoil.

"The IPO market is totally closed right now," he said. "Once that window opens again, and conditions are right to do that, why not?"