Industry Overview

Introduction

In 2004, Industry Canada has confirmed that Look, as the only holder of broadcast spectrum 2500-2690 MHz range, has mobile designation in this band and can apply to launch mobile broadband services. Look’s current license remains unchanged and in effect until August 31, 2011. Look can also apply for licenses for fixed broadband Internet access services. The 2500-2690 MHz will be coordinated with the FCC spectrum plan and Industry Canada will consult with the industry on the implementation of the new band plan.

What does all of this mean for Look? The new 2500-2690 MHz policy provides Look with the flexibility to provide mobile TV when it wants and can launch mobile Internet subject to Industry Canada approval and a partial spectrum give-back.

Comments by Mobile Media Industry Leaders

“Mobile TV will change the way we live, work and communicate even more than mobile voice has ever done”, Rene Oberman, CEO, T-Mobile. Test-trial consumers, industry analysts, mobile phone manufacturers, network providers and content providers overwhelmingly agree that the “next killer application will be mobile TV”.

The past few months have seen much fanfare in the media about mobile TV, however, progress within the industry has been moving at breakneck speed for much longer. Device manufacturers, such as Nokia, HTC, Samsung and Philips, have been working feverishly to provide consumers a mobile device that permits the viewing of live TV.

“Bandwidth is increasing, costs are decreasing, technology is better and cheaper,” says Takeshi Natsuno, Senior Vice-President and Managing Director, Multimedia Services, NTT DoCoMo. “Rights holders are becoming more flexible.”

Simultaneously, network providers are scrambling to determine how they can capitalize on the growth in this industry. “Broadband wireless is going to make the past 10 years pale in comparison [to the next 10]”, said Ed Zander, CEO, Motorola.

For certain, mobile TV will offer new business opportunities. “The biggest battles over mobile TV in the next three years won’t be over competing technologies, but will instead pit broadcast content owners against the wireless carriers who own the mobile customer base”, said Michael Schuppert, President, Modeo. Whereas, Tom McKeever, Consulting Director, Ovum, sees “a significant threat from web-based video, with TV-based browsers enabling companies such as Google to offer their own content, which would leave consumers paying teclos for nothing but access”.

Meanwhile, the dramatic shift in TV viewing behaviour has broadcasters scrambling every which way while trying to determine how they can retain their shrinking portion of the TV revenue pie. “The paradigm has changed, and some would argue no longer exists. Viewers are increasingly dictating what they want to watch on TV or what type of content is important to them. They are already doing this on the Internet”1, mobile TV will follow.

Add to the mix the limited amount of spectrum currently available and allocated for the deployment of mobile video – and you have a whole host of challenges. With respect to the “already brewing clash between content owners and wireless carriers” says Schuppert, “This ‘fight’ will be partly settled by the upcoming international spectrum auctions.”

Further testament to the rapid adoption of mobile TV saw nominees for the first Emmy award to be given by the National Academy of Television Arts and Sciences for outstanding original programming for computers, cell phones and other handheld devices, named this year. The category was created to draw attention to the rapidly growing interest in mobile content that consumers have been quick to embrace. The chief executive of the academy, Peter Price, said 74 entries were received--including those from newspapers, magazines and movie studios - the most ever in any category.

Comments by Look about Mobile Multi Media and the Look launch

The Company recently launched the first stage of its Look Mobile Multi Media (“Look M3”) network for Ontario and Quebec at their head office and broadcast centre in Milton. The Look M3 van offers live TV to four separate headrests - permitting each passenger to personalize her/his viewing of “live” TV and listening to audio channels. Customers will be able to see on their mobile device the same quality of picture and have the same choices as they do at home. We have successfully addressed the existing services which are only able to offer stilted images with limited choices over the Internet.

Cellular phone TVs are unable to replicate an “equivalent to home” quality since their networks were not designed for broadcasting. The cellular networks are unicast networks (one-to-one) with limited capacity for quality mobile TV. “Look M3 has the advantage of a live, broadcast network (broadcasting to an unlimited number of customers) with content and program available to Look under its broadcast license.”

The Look M3 network will consist of two networks – a broadcast network and a broadband network. The broadcast network will allow for the mass distribution of content, information and entertainment regardless of how many customers are receiving and listening. The network will eventually also provide two-way access to the Internet and applications such as VoIP, Web casting, etc. In Ontario and Quebec, what is presently brought into your home on your computer, TV, stereo or phone, will soon be available in your hand.

Look’s new mobile broadcast offering will just be the first application for this new Look M3 experience and will be followed with mobile broadband. Look, with its unique combination of a broadcast license, approximately 100 MHz of spectrum and DVB-H knowledge and understanding, is positioned to offer Look M3, right now in a moving vehicle and then in the customer’s hand. Handsets are presently being developed by a number of international manufacturers.

April 2006