Car Pay-TV And Pay-Per-Video Are On The Rise

Momentum is building for the nascent mobile pay-TV and pay-per-video market, with several companies announcing new ventures for the automobile.

PhatNoise announced it will offer one of the first pay-per-video systems in the industry, and KVH announced a new factory agreement with Cadillac. In addition, Rosen said it plans to offer video game upgrades on a fee basis.

PhatNoise will partner with Nickelodeon Networks and video games publisher Capcom to create its new pay-per-video platform, to be used in some General Motors models.

PhatNoise will offer preloaded video games and TV programming on its OEM HDD players for GM, which can be “unlocked” for viewing by car passengers, for a fee, according to a spokesperson.

In what would constitute a new mobile-video business model, each video package would cost $19.95. It was not clear how revenue from the video packages would be shared as PhatNoise would not comment on financial arrangements.

The PhatNoise HDD player will offer a preloaded, two-hour sampler of programming to include SpongeBob SquarePants and classic arcade games, as well as music from EMI Recorded Music and spoken-word content from Audible.com.

The HDD system, called the Mobile Digital Media Player powered by PhatNoise, is launching in Chevrolet's 2005 Uplander and later this year in crossover sport vehicles from Saturn, Buick and Pontiac, PhatNoise said.

The Mobile Digital Media player includes a 40GB hard drive and a removable cartridge. It fits in the JCI rail port that runs along the center interior roof of a vehicle.

Pay-TV hardware leader KVH Industries recently announced that its TracVision A5 satellite TV system will now be offered through Cadillac dealers as an approved accessory.

KVH also said it developed a special installation kit for the Cadillac Escalade. A spokesman noted, “We are continuing to pursue other OEM opportunities. Cadillac is just the first. We're also pursuing factory-installed programs very aggressively.” The KVH TracVision A5 delivers DirecTV content. It sells through the aftermarket in addition to car makers.

Rosen said it may launch its video game upgrade program by the second quarter of 2006, according to Steve Weimar, sales and marketing VP. He noted, however, “In terms of pay-per-video, we probably won't do it with movie capabilities.”

Mobile video leader, Audiovox, said it is not planning a pay-per-video program, but is shipping its Skybox satellite TV system introduced in January.

Delphi, which announced at International CES, a partnership with Comcast to develop a digital video delivery system to the car over an 18 month period, said that “whether in the form of satellite video or TV, interest in digital video to the car is gaining,” according to Dr. Robert Schumacher, multimedia general director, Delphi electronics and safety.

He believes there will be multiple methods of delivering video into the vehicle. Two possible Delphi/Comcast systems include a portable drive that would allow consumers to download content from a TV or digital set-top box for playback in the car and, secondly, a fixed drive in the car with Wi-Fi delivery of content from the home. Schumacher said initial interest on the part of car makers is “high” in this and other forms of digital video. “I think they're interested because there's a tremendous appetite for high-end entertainment in vehicles,” he added.