The Tokyo-based company lost $1.1 billion (98.9 billion yen) last year, and it expects to lose another $1.4 billion (120 billion yen) in its fiscal year ending March 31.  That would be Sony’s first back-to-back annual loss since the company went public in 1958.

And despite renewed optimism within its ranks, Sony still faces a plethora of challenges, including a questionable direction, cost-conscious consumers and a strengthening yen.

The onetime bellwether of the electronics industry has seen its market share crumble in almost every category: Nintendo Co. Ltd.’s (OTC ADR: NTDOY) Wii game console has supplanted Sony’s PlayStation brand, Sony has given up its lead in portable media players to Apple Inc.’s (Nasdaq: AAPL) iPod, and Samsung Electronics Co. Ltd. is now the world’s largest seller of televisions.

Hoping to turn the tide, Sony earlier this year underwent a major restructuring with the goal of unifying its hardware, software and entertainment businesses. The idea is to leverage its growing catalog of networked products with the software and services its sells, such as Internet-enabled televisions that enable consumers to watch Sony movies through an online connection.

“Consumers want products that are networked, multi-functional and service-enhanced utilizing open technologies, and user experiences that are rich, shared and, increasingly, green,” said Sony Chief Executive Officer Howard Stringer. “[The restructuring] will now make it possible for all of Sony’s parts to work together to assume a position of worldwide leadership and, together, achieve great things.”

Doubts Cast Shadow Over Efforts

While analysts agree with Sony’s loss estimate for this year, some doubt its restructuring efforts – which included thousands of layoffs and a streamlining of manufacturing in the – will truly pay off.

“They were hit fairly early by the downturn and have moved quicker than some competitors to restructure, but it remains to be seen if those moves will pay off,” Hideyuki Ookoshi, who helps oversee $365 million at Chiba-Gin Asset Management in Tokyo, told Bloomberg News. “The problem with Sony is it doesn’t know what it wants to be: Is it a game company, a consumer-electronics maker, a financial-services provider? There’s no direction.”

Operating income at Sony’s financial services division was propelled more than 57% by a boost in its life insurance revenue in the company’s fiscal first quarter ended June 30. But this non-core business won’t be the catalyst that brings Sony out of the red, according to Makoto Haga, president of Tokyo-based hedge fund Wing Asset Management Co.

“Profit at the financial unit helped Sony narrow a loss, but investors don’t appreciate that,” Haga told Bloomberg. “I can’t see any engine that drives its recovery and the company’s prospects are dim.”

As it stands now, CEO Stringer’s cost-cutting efforts have only gone so far, and investors like Yasuhiko Hirakawa want the British-born executive to prove he can boost Sony’s sales, which are expected to be 6% lower than last year.

“Cost cutting and reshuffling of management may help mend unprofitable businesses but they won’t make Sony competitive against Samsung and other rivals,” said Hirakawa, a fund manager at DIAM Co., which oversees $80 billion in assets including Sony shares. “The brand is still highly regarded but that won’t last forever.”

Premium Without the Value in Tough Times

While all electronics manufacturers have suffered during the worst economic crisis since World War II, premium-branded Sony has been hit especially hard. The economy has brought out the practical side of consumers, who flocked to cheaper television sets from makers like Vizio Inc., which is No. 2 in North America behind Samsung.

It’s the “intensification of price competition” that contributed to Sony’s $1.7 billion operating loss in its electronics segment last year, the company said. Comparable televisions from Samsung are often hundreds of dollars less than a Sony, without a significant sacrifice in tangible quality.

“I don’t think you can say a Samsung TV has a better picture than Sony TV,” Richard Doherty, co-founder of industry researcher Envisioneering Group told the San Diego Union-Tribune. “But (the difference) has narrowed, and that’s one of the problems.”

Indeed, while TVs from Sony may have technically superior features such as 240mhz refresh rates, it usually won’t make a difference to the mass market. The benefit of such a feature is “difficult to discern,” writes CNET, a leading Web site from CBS Interactive Inc.

Televisions are just one area where Sony is struggling with its value proposition. Until recently, Sony faced mounting pressure from video game executives and analysts to cut the price of its $400 PlayStation 3 (PS3) console.

“They have to cut the price, because if they don’t, the attach rates [the ratio of games purchased to a console] are likely to slow. If we are being realistic, we might have to stop supporting Sony,” Bobby Kotick, chief executive officer and president of Activision Blizzard Inc. (Nasdaq: ATVI) said in a June interview with Times Online.

After months of lowering manufacturing costs on PS3, Sony finally dropped the price of the console to $300 in the United States and launched an ad campaign touting “It only does everything,” a reference to PS3’s ability to play games, Blu-ray movies and browse the Internet.

The result was Sony selling more than 1 million PS3s in the first three weeks of September, almost the same amount it sold in the entire second quarter. A similar price drop in Japan led to PS3 outselling Nintendo’s Wii last month, a first since the console was released in Nov. 2006.

Sony’s Walkman, which first revolutionized portable audio 30 years ago, now comes in the form of a touchscreen digital media player, but has failed to put a dent in Apple’s ubiquitous iPod, which also has a touchscreen model. Sony’s 32-gigabyte Walkman sells for $400. But while it gives users some limited Internet options, Apple’s comparable iPod Touch sells for $100 less and has access to thousands of applications – many of them free – in its vaunted App Store.

Without any tangible features to discern it from the competition, it’s no wonder Sony expects to sell just 6.7 million Walkmans this year, while Apple sold 10 million iPods in its third quarter alone.

Currency Crisis

Sony, like its Japanese counterpart Panasonic Corp. (NYSE ADR: PC), is inherently at a disadvantage to Korean competitors like Samsung and LG Electronics Inc. due to the yen’s strengthening position against the won and U.S. dollar. The yen’s gain has enabled the Korean manufacturers to sell its products at a discount of as much as a 10% without taking a hit on margin.

“We don’t have a moment to breathe,” Sony Vice Chairman Ryoji Chubachi said of the strengthening Japanese currency in a Bloomberg interview on Tuesday. “It is a tough environment.”

The yen has gained about 15% versus the Korean won and 14% against the dollar in the 12 months ended Sept. 30, according to Bloomberg data. The dollar is at its weakest levels against the yen since February, trading at as low as 88.86 yen on Tuesday. The yen has been the third-best performer among G-10 members in the past 12 months.

For Sony and other Japanese companies, a rising yen is “like a death warrant as things stand now and if this continues, they will have a very difficult time,” said Chu Moon Sung, a Seoul-based fund manager at Shinhan BNP Paribas Asset Management Co., which manages the equivalent of $26 billion in assets. “For Korean companies, it’s a favorable environment and the currency has been the biggest factor for their good performance.”

Source: The Three Roadblocks to Sony’s Turnaround

I’m talking about organic light-emitting diodes, or OLEDs. OLED displays are taking off in a big way. These next-generation displays are perfect for the mobile phone and personal media device markets because they are thinner than traditional displays and produce sharper images.

OLED — and active-matrix OLED — technology has now reached its tipping point. Very soon, we will begin to see OLEDs used in a vast array of electronics, including small televisions, digital cameras, netbooks, phones — the list goes on and on.

The rise of the OLED display is similar to that of the flat-panel television. Once a novelty, flat-panel LCD and plasma televisions quickly became the industry standard as quality and production increased while prices fell. The “transition” from bulky tube televisions to sleek flat-panel displays took only a few short years.

Try walking into your neighborhood electronics store today to browse the tube television selection. Be warned: You will be disappointed. Only a few models remain, and you can easily purchase a comparable flat-panel television for about the same price. And a flat panel can actually save you money, since it uses less power than a standard TV. Yes, it seems that the tube television is going the way of the VCR. It won’t be long before they’re only available at yard sales and antique stores.

OLED Growth: The Story Is in the Numbers

Experts from world mobile display sector leader Samsung Mobile Display are banking on OLED screen use in mobile phones to “grow significantly.” And with overall smartphone use also growing dramatically, we have before us a unique opportunity in the OLED market.

The Samsung venture expects the global smartphone market to grow to 500 million units by 2012, making up almost 30% of the industry. To put this in perspective, consumers are using 170 million smartphones right now.

Better phone technology means better displays. Samsung predicts OLED screens will be used in half of these new phones over the next five years. That’s hundreds of millions of units…

Overall, the OLED display market will grow to $6.2 billion, according to DisplaySearch forecasts. Last year, the total OLED market was worth an estimated $600,000. As you can see, we are looking at exponential growth, with the mobile phone market leading the charge.

As the technology continues to improve, we will begin to see even larger OLED displays. LG Electronics and Sony (NYSE:SNE) are each planning on releasing 15-inch and bigger OLED display televisions by the end of this year, according to DisplaySearch, with OLED netbooks and larger televisions showing up by the end of 2010.

Obviously, LG and Samsung are the big players in this market. But there are a couple of small-caps that have also found success developing OLED technologies. A good place to start looking would be Universal Display Corp. (NASDAQ: PANL). While the company is not yet profitable, it does have a promising patent portfolio that includes phosphorescent OLED technology.

Best,
Greg Guenthner

Source: OLED: The Next High-Tech Profit Opportunity

But sometimes, we make exceptions – especially when their over-zealous attitude causes a stock to blast higher and hand us triple-digit gains.

I remember one such occurrence in particular with a high-tech company that we own in our Xclerated Profits Report portfolio. Thanks to some giddy CNBC analysts pumping up the price, the stock surged from $6 to $20 and we took half our position off the table for a gain of more than 100%.

The small-cap stock has suffered along with the broader market, but there’s no doubt that its business is viable. It’s leading the way in the field of touch screen and force-feedback technology – otherwise known as “haptics.” In short, this simplifies and enhances human interaction with technology in a variety of ways.

Cellphones… Games… Cars… Healthcare… This Technology is Everywhere

You’ve probably used the company’s tactile feedback technology and don’t even know it.

• For example, its technology is what causes cellphones to vibrate when they ring, or you get a message. And the company has licensed the technology to major firms like Nokia (NYSE:NOK), Samsung, Motorola (NYSE:MOT), and LG.
• It’s also present in video games, which gives gamers a more interactive, realistic experience, as the action on the screen is “forced” back into the controller.
• Elsewhere, it’s used in the auto industry in dashboard instruments, the casino industry in gaming machines, and the medical industry, in helping to train surgeons and doctors by replicating the behavior of the human body.

The company holds hundreds of patents and it recently signed a deal with a major chip company, a move that an influential analyst called a “game changer.”

In short, we spotted the vast potential well before Wall Street and we’re looking for another triple-digit win on the stock. And if that happens, we’ll adopt the same practice that we always do – one that you should use in your own investing…

The Name of the Game is Profits

We have a hard and fast rule at the Xcelerated Profits Report: We don’t discriminate when it comes to profits. That means if we have a winner of 100%-plus, we take our money off the table. This is true for stocks or options.

We did this last week when we sold half our shares in the gold company Golden Star Resources (NYSE: GSS) for a cool 103% gain in just a couple of months. But what makes this trade even sweeter is that we bought the shares using the proceeds from call options that we sold on another gold stock we’ve owned for a while – Yamana Gold (NYSE: AUY).

Come options expiration in January, if Yamana is trading above $6.75 per share or thereabouts (it’s currently close to $11), we’ll have essentially bought the shares of GSS for nothing.

And speaking of gold, I’ve made another play in the upcoming October Xcelerated Profits Report issue, due out at the end of this week. But it’s a play with a twist – we’re taking a “show me” stance on gold prices, arguing that gold is either going to soar or plunge from current levels. What’s more, we’ll make it do so for about $3. If you’re looking for exposure to gold, or to hedge against a price drop, you don’t want to miss it.

The bottom line is that we don’t just make picks. We take our ideas and then figure out how to turn them into “xcelerated” profits by using straightforward investment strategies that many other investors don’t know about. We teach, then we trade.

Good investing,

Karim Rahemtulla

Source: How to Turn Ordinary Profits into ‘Xcelerated’ Profits

There was more money available to buy shares than at any time in almost two decades. The $8.85 trillion held in cash, bank deposits and money market funds was equal to 74% of the market value of U.S. companies, the highest ratio since 1990, according to the Federal Reserve.

What happened in the past when cash reached these levels?

• In September 1974, cash on hand reached $604.5 billion, representing a record 1.21 times the U.S. stock market’s capitalization. That preceded a 31% gain in equities between October 1974 and March 1975.
• In July 1982, just as a 20-month bear market was ending, cash as a percentage of the U.S. stock market’s value rose to 95%. The S&P 500 began a six-month, 36% advance. According to Bloomberg, the eight previous times that cash peaked compared with the market’s capitalization, the S&P 500 rose an average 24% in six months.

This time, of course, it didn’t take nearly as long for the market to rally.

Still, the greatest appreciation so far has been in smaller stocks. That’s normal in an early bull market. But if the bull market continues, the big, blue-chip stocks are likely to lead the market higher for two key reasons:

• First, there is still over $8 trillion on the sidelines earning next to nothing in short-term deposits. Investors tip-toeing back into the market are likely to gravitate here since these stocks are the safest.
• And then there is the growing influence of cash-rich sovereign wealth funds…

Sovereign Wealth Funds – The Financial Assets of a Country

Sovereign wealth funds are the financial assets of a country – usually part of the national savings – that are owned and organized into a state-controlled fund and put to work to earn a higher return on investment.

(Sovereign wealth funds are not the same entities as foreign exchange reserves, which are often used for short-term currency stabilization and liquidity.)

In the past, most countries put their liquid assets to work in foreign currency deposits, government bonds or gold. (The hard-working Japanese and Chinese, for example, have kept our interest rates low by maintaining a steady appetite for U.S. Treasury obligations.)

But with the dollar relatively weak and interest rates on Treasuries near record lows, U.S. government bonds are not generating the kind of returns you write home about.

So world governments are slowly moving money into global equity markets. And the sums involved are fairly staggering.

Sovereign Wealth Funds Control More Than $7 Trillion…

According to The Economist, sovereign wealth funds already control more than $7 trillion today. The exact amount is impossible to ascertain due to lack of transparency.

But China, Saudi Arabia, Singapore and the United Arab Emirates alone are known to control more than $2 trillion. And more money is being allocated to these funds all the time.

What does this mean for you as an investor?

Expect to see cash coming off the sidelines to accumulate shares of the largest, most liquid firms around the globe. Quite frankly, they are the only companies that can easily absorb buying on this scale.

For example, take a look at the Dow Jones Global Titans Fund (NYSE: DGT). It holds the world’s 50 largest publicly traded companies.

World-Class Diversification in a Blue-Chip Portfolio

When you buy this cheaply valued blue-chip portfolio, you’re getting world-class diversification.

Companies like:

• Exxon Mobile (NYSE:XOM),
• IBM,
• Proctor & Gamble (NYSE:PG),
• Wal-Mart (NYSE:WMT),
• Coca-Cola (NYSE:KO),
• Nestlé,
• Toyota Motor (NYSE:TM),
• Roche Holdings,
• Samsung Electronics

… Are just a few of the names that are major holdings of the DGT fund.

These firms will almost certainly be an early stop for U.S. investors who get frustrated with low yields and start venturing back into the game.

These same companies are a natural home for sovereign wealth funds – and the growing trillions they control.

History shows that cash on the sidelines always grows itchy with time. The Dow Jones Global Titans (NYSE: DGT) is a good way to take advantage of it – ahead of the crowd.

Good investing,

Alexander Green

Source: Sovereign Wealth Funds: $7 Trillion Reasons to Stay Invested

Immersion develops haptic technologies that allow people to use touch to operate digital devices. Think the type of fancy touch-screen technology used by the much-hyped iPhone.

Paul says Immersion remains loaded with potential but remains still somewhat on the launchpad. But with three major set to toss the firm new business, Paul is bullish…

While Immersion has met its financial expectations, the mass adoption curve for its technology has been pushed out and has overlapped a point in time where high beta stocks have been stripped of premium valuations.

That said, we believe the underlying fundamentals remain intact and the stock is attractive here.

In case you don’t know about Immersion’s industry, the company is a market leader in the field of haptics – a technology that simplifies and enhances human interaction with everyday technology. The company holds hundreds of patents and provides products and patent licensing to some of the world’s biggest firms.

We’ve already seen the first wave of enthusiasm, as Immersion’s technology is incorporated in cutting-edge consumer electronics products like cellphones (Immersion’s patented VibTonz software is already in Nokia (NYSE: NOK), Samsung, and Motorola (NYSE: MOT) handsets) and Sony (NYSE:SNE) PlayStation video games.

However, the company’s smaller segments (mobility, gaming, and automotive) are enjoying faster growth at the moment and offer the most opportunity. And as this technology matures, it will filter into products with lower price points that have mass appeal. At that point, IMMR’s top line will have the potential to grow exponentially in line with unit shipments.

Medical Division Set To Spring Back To Life, While Other Segments Rise Rapidly

While the consumer products receive most of the attention, the bulk of Immersion’s revenue actually comes from medical training devices that help surgeons learn their craft.

That core business has slowed in the US recently, but a push to expand in Europe and Asia is likely to reaccelerate revenues from this segment later this year. And even as its Medical division has slowed, Immersion has managed to offset that through rapid growth in newer areas.

For example, strength in the Mobility (NADAQ:USMO) division saw sales shoot up by ten times during the most recent quarter and now accounts for 13% of revenues. And looking ahead to the remainder of 2008, there is plenty to be excited about…

The Buyer’s Favorite Word

Right off the bat, three major industries are set to toss more business Immersion’s way:

1. Auto: BMW (FRA:BMW) is expanding the use of iDrive into its 3-series models.
2. Telecom: Samsung and LG are shipping handsets that leverage haptics and Nokia is expected to follow later this year.
3. Gaming: 3M (NYSE:MMM) is producing casino gaming screens, which could offer upside over the second half of 2008.

That’s the business end. But what about the stock’s valuation?

In a word: Cheap.

While the concept of buying low and selling high is a mainstay of investing, every now and again, this simple concept temporarily eludes investors.

That explains why Immersion trades for less than two times its net cash. In the software industry, buying a profitable company at that price is relatively unheard of. But at a time when fear is rampant, you occasionally get the opportunity to snag a bargain.

In Immersion’s case, it boasts $4.52 in net cash per share. This is in cash equivalents that could be quickly liquidated if a majority holder were to buy the company.

This basically means that if a third party such as Sony or Apple (NASDAQ:AAPL) or Oracle (NASDAQ:ORCL) were to buy the company, it would be getting the operating business and patent portfolio for $2.30 per share (assuming a $6.82 share price). When stocks get to these levels, it becomes cheaper for a partner to acquire the firm than pay royalties for the licenses.

The Big Boys Bailed Out… But Are Now Getting Back In

Unless you took a vacation from the planet over the first three months of the year, you’ll probably know that it represented the worst start to the year for the stock market, as gridlock in the credit markets plunged financial institutions into dire straits.

That goes some way to explaining the unusual selling pressure that Immersion endured during the first quarter.

For example, Immersion’s largest holder, Goldman Sachs (NYSE: GS), all but liquidated its position over that period. Goldman sold 78% of its 3.1 million share position and if you assume that the firm sold those evenly throughout the quarter (a measured program of selling, rather than panic), it accounted for 5% of the daily volume each day. This represents a significant hurdle for a stock to overcome in a stable market, let alone a panic situation.

Since then, however, big institutions have ramped up their buying of Immersion shares. Two large shareholders have stepped up big-time, with Balyasny beefing up the size of its position by 131%, while Immersion’s largest current shareholder, Mazama, has bought 23% more stock.

This represents a strong vote of confidence from institutions that are intimate with Immersion’s story and have combined to own 15% of the shares outstanding.

Here’s The Skinny On Immersion’s Plan To Fatten Up

To sum up, Immersion has its finger on several different developing markets that have the ability to dramatically increase its growth. If one of them catches fire, investors will benefit from accelerating profit growth and multiple expansion. Additionally, Immersion remains a buyout candidate for the likes of Sony or Samsung and a precedent was set earlier this year when Nokia acquired Navteq (NYSE:NVT).

The downside scenario would be if Immersion’s share price stagnates at current levels. That could happen if increasing pressure on consumer spending delays the adoption of devices using haptics. However, the low valuation would likely still provide support for the stock and you’d merely sacrifice opportunity, which is much better than sacrificing investment capital.

Source: Immersion Is ‘Force-Feeding’ Its Way Towards Solid Growth

He’ll be joined by Vice Chairman Lee Hak Soo and Presient Kim In Joo, who will quit by the end of June.

“The resignation by Chairman Lee Kun Hee is unprecedented,” Tom Coyner, who helps advise foreign investors in Korea as president of Soft Landing Consulting Ltd. in Seoul, told Bloomberg. Coyner said it signals “an end to the era of the Masters of the Universe.”

After more than two decades on top of Samsung, Lee was shrouded in controversy. Last week, he was charged with evading $133 million (112.8 billion won) in taxes and breaching his chairman duties by enabling his son to reign control of several of the group’s units.

These charges stem from a four-month investigation that began when Lee’s house was raided in January after a former company lawyer alleged the company created several “slush funds” valued at $200 million.

Lee tactfully apologized in a televised briefing – not so much for the base of the charges, but for the trouble they are causing.

“I’m truly sorry for causing so much concern with the investigation,” Lee said. “I will assume full legal and moral responsibility.”

Interestingly, the current charges pale in comparison to previous charges brought against Lee. In 1996, he was convicted of bribing South Korean presidents Chun Doo Hwan and Roh Tae Woo, which earned him a two-year prison term that was soon pardoned by sitting president Kim Young Sam.

And in 2005, Lee was investigated for – and later cleared of – using corporate funds to pay presidential candidates.

No change expected, somehow

For Samsung, the resignation trifecta creates a serious hole atop the conglomerate. In the meantime, the group will dismantle its strategic planning office.

Some analysts are skeptical of the move’s ambiguity, especially when timed after top brass resignations.

“I don’t see anything more than a change of people in charge. There’s no change at all in the fact that (the Lee family) will remain the owner,” Citibank economist Oh Suk-tae told Reuters.

It would take a team of lawyers to dissect the degree and specifics of the Lee family’s ownership of Samsung, but put simply, they own a large majority of the parent company and its units’ shares.

And it isn’t likely that the scandal – as colossal as it would be if it occurred in the United States – will affect the company’s operations.

Samsung’s businesses include high-tech offerings, semiconductors, telecommunication, life insurance, fiber optics, supertankers, compressors and more – all of which account for about one-fifth of South Korea’s exports, Reuters reported.

Samsung Electronics Co. Ltd. alone is Asia’s largest maker of cell phones and televisions.

According to the report, “Mobile TV in India: Understanding the Mobile Entertainment Needs of Indian Users,” mobile TV could achieve a penetration rate of 5% to 6% of the total mobile-communications subscriber base in India this year. This is the first year that mobile TV services are being offered, says Springboard, a top provider of advisory services on new and innovative information-technology products and services.

“The market is ripe for the launch of mobile TV services and we believe that India will have around 12 million mobile TV subscribers within the first year of launch of service,” Ravi Shekhar Pandey, Springboard’s manager of syndicated research, said in an interview with the International Business Times. “Mobile telephone operators will have an advantage over standalone mobile TV operators in that the former already have users subscribing to their value-added services. However, the success of either operator will be dependent on content offered and price charged for the service.”

Subscription-based mobile TV is available in the United States, through such services as the V-Cast Mobile TV service offered by the Verizon Wireless unit of Verizon Inc. (VZ), or the MobiTV service offered by Cingular Wireless, now a unit of AT&T Inc. (T). However, those two services are each unique to their respective carriers, since the two companies employ different wireless technology standards. The Cingular service debuted in 2006, while V-Cast first became available in 2007.

When it comes to tech-based products and services aimed at the consumer market, Asian countries tend to be the world’s “early adopters” – with such wares appearing in markets like Japan, Korea or India months or even years before similar offerings appear for sale in the U.S. market.

Japan is typically the best example of this trend. Take global-positioning systems. Consumers and cab-drivers were adding portable GPS units into their cars as early as the middle 1990s; those same products didn’t really make a splash in the U.S. market until the early part of this decade, and it’s only been in the past couple of years where the prices have dropped to the point where they’re becoming a ubiquitous add-on, or where automakers are offering them as an option on new model cars and trucks.

Indeed, among the many things that the Japanese metropolis of Tokyo is known for is the “Akihabara Electric Town,” a massive gadgets bazaar that’s a 10-minute train trip from the downtown. A bustling, overcrowded community before World War II, the area was wiped away by a fire and kept clear – eventually evolving into what many believe is now the largest concentration of electronics vendors anywhere on earth.

One of the town’s early claims to fame was for being the home to one of the first stores devoted to personal robots and robotics. Western tourists who visit Japan invariably visit Akihabara, and are typically stunned to find electronic products that aren’t available in their home market – and that don’t actually show up there for months or years.

India’s mobile-TV services are yet another example of an innovative, tech-based service that many American consumers have never even heard of.

In India, public-service broadcaster Doordarshan is the only company currently offering limited mobile TV service. Nokia Corp. (NOK), Spice Communication’s Spice Telecom unit, U.S.-based Qualcomm Inc. (QCOM) and South Korea’s Samsung are few of the stakeholders actively promoting the adoption of mobile TV in India.

In its report, market-researcher Springboard recommends that mobile-service providers should offer an “on-demand” pay-per-view option that does not bind users to a monthly subscription for mobile TV. Springboard also concludes that a close collaboration between mobile operators and broadcasters will create a profitable business model for mobile TV service in India.

That model makes sense, since “mobile TV marries the two dominant consumption trends of entertainment and mobile telephony in India,” said Pandey, the Springboard Research manager.

In the U.S. and European markets, mobile TV has so far been a “mixed bag,” according to a new study. The business potential is very large – an estimated $270 million in the next 12 months – but only if carriers can improve the quality of their offerings and the reliability of their service, both of which have been less than satisfactory.

The so-called “M: Metrics Study,” commissioned by networking leader Tellabs Inc. (TLAB) – and released at the “Mobile World Congress” in Barcelona back in mid-February – found that the mobile TV market grew at an impressive 36% in 2007. However, the population of “former” mobile TV subscribers – those who cancelled out of dissatisfaction or other reasons – grew at nearly double that rate (68%).

However, the study also found that 60% of the former subscribers say that they would pay to watch mobile TV again if service quality and reliability significantly improved in the coming year. And by regaining just half the potential market lost due to those quality and reliability issues, mobile operators would achieve the $270 million revenue target, the study concluded.

At the Mobile World Congress, carriers were looking at market opportunities, crucial at a time when such things as airtime have become little more than a commodity service whose success or failure turns largely on service quality and price.

“Users decide which new services succeed, not the industry,” said Tellabs Vice President Pat Dolan. “It’s challenging for operators to make a living as mere pipe vendors. By offering mobile content users enjoy, operators can increase revenue. Yet this necessitates network enhancements, as acceptance of high-bandwidth services depends on the quality, reliability and capacity of the mobile backhaul. Tellabs is working with many operators in addressing these issues, and we are confident the industry will progress further.”

According to Tellabs, the research that it commissioned on Mobile TV users’ attitudes was conducted in the United Kingdom, Germany, Italy, France, Spain and, for the first time, the United States.