TV streaming has mobile operators running scared

The days of the mobile phone being just a device for making emergency calls are far behind us, but while most of us have handsets that can at least play music or download our email on the go, the biggest fear now facing mobile phone operators and carriers around the world is the ability to use the mobile Internet connection that we all feel is our right, to stream live television over the network.

They say you wait forever and then two buses come at once. And that's exactly what happened for the iPhone in the last seven days. Not one live streaming TV service, but two were launched. The result is that O2 in the UK has had to issue a warning over the TVCatchup iPhone site, one of the services that if users use too much, means they could be cut off.

Meanwhile AT&T in the US had to move in to get a new app by TV tuner maker Elgato that allowed users to stream television from a TV tuner plugged into their Mac directly to their iPhone over the 3G network, changed.

While Apple has the power to force a change in the app, something they have done, and O2 to block the streaming service, something they are threatening, other handset platforms, which are more open, like Android or Symbian, don't have as operator friendly approach and that's before you even start to address jailbroken apps that allow offerings like SlingPlayer Mobile to work on the 3G network. 

The problem of course isn't about you watching television, although it does raise questions about TV licensing laws in the UK, but about the strain on the network.

Strangely operators like O2 and AT&T are already struggling under the strain of supplying data requests to all it's smartphone users. Add in a constant stream of large amounts of data, i.e., from a popular streaming TV service, and I wouldn't be surprised if the networks around the globe buckle massively under the strain.

Forget the previous concerns of the operators in losing revenue over VoIP calls, thanks to services like Skype and Google Voice, think about the cost of managing a network that is now about data, rather than calls without the ability to charge SMS prices.

So what's the solution? In the short term I wouldn't be surprised if mobile operators moved to either ban them outright or move to create a tiered data system aimed at those who want to consume the larger data content over those that don't.

We might have moved into an "all you can eat" pricing model at the moment in the form of "unlimited" packages, but that is no longer beneficial for the operators for the admittedly minority users who are heavy consumers of data.

While I would love to believe that heavy data users will be able to continue as is, I just can't see that happening. A tiered system based on speed or data consumption would benefit virtually everyone just as it does in the fixed (landline) broadband market. Those who need to stream movies or games can do so with a service that fits their needs, and more importantly have the right to complain if it doesn't. Those who just need email or basic websurfing can do that too.

Whatever the handset or the app one thing is certain - the headache facing operators on how to manage the network, and therefore our expectations of it are only going to get worse.