Watching "Survivor" on your cell phone? Watching your favorite basketball team on the iPod? The idea of watching TV or streaming video on a handheld device is not yet main-stream, but telecom providers are spending millions developing services in hopes of riding the expected wave of increasing consumer adoption. A wide range of research firms are forecasting the market to grow to anywhere between $5 billion and $25 billion worldwide by 2010.

ABI Research forecasts that from about 1 million customers today, demand will explode by 2010 to 250 million customers worldwide who subscribe to video services on mobile phones, creating a market worth $27 billion.

In the U.S., consumers are slower to adopt handheld video offerings and EMarketer forecasts that only 15 million U.S. consumers will watch TV on mobile devices by 2009. In-Stat/MDR puts the U.S. number at 22.3 million and a U.S. market worth $5.4 billion. The company also predicts that 31.1 million people will use video messaging services by 2009, meaning that mobile video services will account for almost 15 percent of total wireless data revenues.

A recent In-Stat/MDR survey of U.S. wireless consumers found that 13.2 percent of them are extremely or very interested in buying video services for their cell phones. Many factors like advances in compression technologies, availability of multimedia handsets and consumer interest, will boost wireless video services, according to In-Stat/MDR. By comparison, video is a driver in Europe, but so are music services, ring tones and games, according to market researcher IDC.

Over the last few years, the wireless industry has pushed to develop technology for next generation networks such as UMTS or W-CDMA -- commonly referred to as 3rd Generation Wireless Technologies (3G). These provide high bandwidth, multimedia communication, including video transmission and instant information access. Japan already deploys some commercial 3G services including i-mode, i-appli, full-motion video image transmission, music and game distribution, and others.

Getting subscribers to pay to watch video will help wireless carriers recoup the billions invested in these networks. Besides subscription fees, carriers will make money selling advertising on the networks. For this to happen, carriers will have to reverse consumer attitudes and overcome significant technology and standards barriers, not the least of which is screen size.

Nevertheless, one industry expert, whose company develops and markets technology for streaming video, thinks it will happen as soon as forecasters predict, if a suitable handheld device with sufficient screen size wins market approval.

"The technology is there today to deliver video via IP networks to handheld devices," says Dave Stoner, President and COO of ViewCast (OTCBB:VCST), the leader in developing video and audio encoding solutions to deliver content via a variety of network types and protocols. "The challenges lie in developing a business model for content delivery that makes sense economically; the form factor of the handheld device; and the method of delivery.

"When we began almost eight years ago -- about the same time that streaming technology first developed -- everything was based on delivery of content over IP networks to the desktop," says Stoner. "Now almost any type of device can support video delivery."

Stoner points out most video offerings today are still in the test stage. Companies are developing the business models to determine what content people want and what they are willing to pay. On the technical side, carriers are in the process of looking at delivery options that do not include major renovations of existing networks. Work is also ongoing to devise a handheld device that's easy to carry, but has a screen large enough to allow users to enjoy watching video or TV shows.

The carriers have two ways to deliver content, according to ViewCast's Stoner. "You can enhance the data capability of the telephone network so there is enough capacity to deliver content, or you can run a parallel data network that the phone can access. Some larger phone companies have a data network already in place to deliver high bandwidth content to handheld devices.

"Other companies will lease space on a DBV-H network -- digital video broadcasting-handheld. In the U.S., Modeo has a nationwide DBV-H network and they are working on agreements with carriers so the carriers can use that network to deliver broadband content to their customers," Stoner says.

The move to provide streaming video to handheld devices puts ViewCast at the heart of the issue. "We are the bridge between the broadcast content world and the IP delivery world," Stoner says. "We're the technology that fits between those two spaces. If someone wants to convert their content from broadcast format into a form that is deliverable across an IP network, our technology does the work. Today people are using our Niagara systems and Osprey cards for creating content in 3GP, Windows Media and other formats used by handheld devices.

"We've been involved in a great many of these trials," Stoner points out. "We have strong relationships with Real Networks and Microsoft, for example, and other companies providing encoding algorithms and server technologies that are part of this delivery process. A major mobile carrier in Australia also is using our products for creating content to run tests."

Microsoft recently launched a video download service offering daily television programming, entertainment clips, and other digital content for viewing on Windows Mobile-based devices, according to the company. The MSN Video Downloads service draws on content from Microsoft partners such as CinemaNow, MSNBC.com, and TiVo, allowing subscribers to watch video on their smart phones, Pocket PCs, and Portable Media Centers.

"One interesting issue will be the size factor of new devices -- how much bigger can they get without ceasing to be a phone anymore," Stoner says. "People want the small form factor but they want a screen big enough to view. So we will see some very innovative form factors that will give you a bigger display in a device that is still manageable as a phone. There are some very exciting products on the drawing board today."

Technical issues aside, companies are rolling out plans for services at a dizzying pace. Sprint Nextel teamed up with several cable companies in a wide-ranging deal that will result in co-branded phones allowing consumers to download entertainment programs to their mobile phone and even remotely program their home digital video recorder. Users of Apple's video iPod can download episodes of ABC shows and trailers from Disney movies. The company has said that 8 million videos and television shows have been sold at its iTunes online store in the first four months of operation. Verizon and Qualcomm are teaming up to deliver live broadcast TV to mobile phones.

MTV Networks has agreed to become an investor in privately held Amp'd Mobile and will provide video clips and other content for a wireless service that Amp'd kicked off in December. Amp'd is renting space on the Verizon Wireless network to sell a mobile phone service aimed at young adults. Several companies, including Walt Disney Co. and SK Telecom are setting up similar ventures with the hope of carving out their own space in the already competitive U.S. market by concentrating on narrow market segments.

Cingular Wireless has signed a deal to offer streaming video of HBO shows, including the "Sopranos," "Sex and the City," "Rome," and "Six Feet Under" on mobile phones. The deal is part of the Cingular Video service that the carrier plans to launch. The service would be available to consumers with cellular phones capable of accessing the company's high-speed service.

And at least one automaker is getting in on the effort to harness mobile phone TV as a major branded entertainment medium. Jeep is launching its own mobile phone channel with MobiTV. The content is available to about 500,000 subscribers using Cingular Wireless L.L.C., Sprint Nextel Corp., Alltel Corp. and other mobile networks.

And where video goes, can advertising be far behind? According to EMarketer's recent report, just as online video advertising is ramping up fast, mobile video advertising will follow closely on its heels. "If I had to make one prediction about what technology is going to explode, (it's) mobile media," said Charles Rutman, North America chief executive of media buying agency MPG, at Reuters' November 2005 advertising summit.

While most experts say mobile entertainment will not become a strong consumer market for at least four to six years, when it happens it will herald an economic shift in the wireless market. As the price of talk time falls, carriers will focus more of their marketing attention on entertainment offerings. Talk time could eventually be free, or near-free, depending on your level of mobile entertainment usage.

That could be a harbinger of happiness at home, at least in homes where teenagers reside. An end to battles between parents and teens over using too many cell phone minutes would be a truly entertaining situation.