PARIS (Reuters) - Mobile TV technology provider Siano sees revenue growing to as much as $50 million in 2012 from $37 million last year, boosted by new commercial services in the United States and Japan as well as sales to the automotive market.
Until now Israel-based Siano, which has been operating since 2005, had focused its efforts on China, as much of the rest of the world was slow to embrace mobile TV. This is starting to change with the growth in sales of tablets such as Apple Inc’s (AAPL.O) iPad, as well as smartphones.
“We see a trend that a lot of people perceive tablets as a platform for watching TV,” Siano CEO Alon Ironi said at the Reuters Global Media and Technology Summit in Paris on Tuesday.
The U.S. mobile TV launch this summer is being led by networks such as NBC, Fox, Telemundo and ABC, with major cities expected to broadcast six or more channels, initially for free.
Ironi expects Siano to have a 50 percent or more share of the market in the United States, where he forecast sales of a few hundred thousand units in 2012.
“If it’s very successful maybe Christmas will take this up to a million. In 2013 a few million units will be sold,” he said. “We do think this will be a large market ... We’re optimistic about it.”
Siano began as a designer of chips for mobile TV but has expanded into providing accessories that enable TV broadcasts over mobile devices.
In the United States it teamed up with Belkin to offer accessories for Apple’s iPhone and iPad, while in Europe Siano sells directly to mobile operators under its brand.
“We grew from around $4 to $5 million in 2008 to ... $37 million in 2011. This year we will definitely be between $40 and $50 million,” Ironi said.
In Japan, where Siano opened an office this year, there are two services - a high-resolution mobile phone service and a pay TV service led by NTT Docomo (9437.T).
“We have a few design wins that will mature into sales in 2013,” Ironi said.
China, where Siano has a 55 percent market share, has been the company’s largest source of revenue for the last three years. China Mobile (0941.HK) has made mobile TV an integral part of its third generation (3G) package, Ironi said.
While critics argue that enough content is already provided by mobile Internet services, Ironi said mobile operators are interested in broadcast TV as it allows them to offload consumption from their networks.
Siano’s devices do not depend on a wireless connection and are especially attractive for broadcasting content such as sports and news, which viewers want to watch live rather than via download.
“Mobile Internet consumption continues to grow at a pace that exceeds the capacity of the infrastructure. If we try to play live TV over LTE (4G technology) in large cities, LTE will be choked on day one, people won’t be able to make phone calls,” he said.
The fact that operators such as China Mobile, NTT Docomo and AT&T Inc (T.N) have made a decision to provide broadcast mobile TV “makes us confident going forward,” Ironi said.
The automotive market is another focus for Siano, which has been working with companies such as Audi, BMW and Volkswagen.
“In the beginning it was in luxury cars ... but we see an expansion of that, bringing TV to more regular, family cars. By the end of the decade most cars from middle range and up will have TV integrated as a feature,” Ironi said.
Siano is not yet profitable as the shift from chip designing to providing complete products required large investments.
The company, which has raised $100 million privately, plans to go public but has no target date as it waits to see how services unfold in the United States and Japan.
“We believe it would not be smart to go public now when a lot of people in the investment community still have a perception of mobile TV not going well,” Ironi said. “The U.S. is really important. It’s better to go public when the service there is available.”
Editing by David Holmes