Virgin Mobile is the first UK operator to market mobile broadcast technology in a major campaign. If you walk down any UK shopping street at the moment, you will find a Virgin Megastore decked out with banners and promotions for its mobile TV service and ‘Lobster’ handset (produced by HTC and running Windows Mobile).

The package is extremely competitive. For GBP 25 per month, customers get 300 minutes of calls, 300 text messages, free mobile TV for the life of the contract, a free handset and a reduction in the monthly fee to GBP 20 after the first year.

At first glance it has all the hallmarks of an exceptionally successful marketing campaign. Zero-cost hardware, a well-designed price plan and the unique feature of mobile TV and radio – for free. Coupled with the appeal of the Virgin brand, this seems like a strong proposition.

The reality of the customer experience, however, is rather different.

Before I talk about that, here is some background on the technology.

Virgin’s mobile broadcast service uses BT Movio’s DAB infrastructure. This is the same technology used for digital radio in the UK. BT is building out its own network to deliver multimedia content. The advantage of digital broadcast is its ability to transmit the large amounts of data required for video services to an unlimited number of people at the same time. Traditional mobile base stations have a limited capacity within their cell coverage area, meaning that several users trying to access video at the same time can considerably reduce transmission speed for everyone else.

This has spurred numerous companies to offer solutions based around the broadcast model. Virgin and BT are using DAB infrastructure, while Nokia and O2 are working together on the emerging DVB-H standard. Qualcomm has its own offering – MediaFLO – and there are several other variants in different stages of development.

The DAB approach has several benefits. The technology is already widely deployed and the mature market for components means there are economies of scale.

So how does this manifest itself for the customer?

I visited a branch of Virgin Megastore in a major metropolitan area to demo the service. There was a special in-store department dedicated to Virgin Mobile and a kiosk for the mobile TV offer. The member of staff running the booth was very knowledgeable and was able to explain the technology behind the service and translate this into layman’s terms so I could understand why this would benefit me, the potential customer.

The handset itself is not particularly attractive. The bulge on one side, presumably housing the DAB receiver, gives the the device a rather odd asymetrical look. However, I didn’t encounter any major problems with the user interface.

The default screen for the TV service is an electronic programme guide (EPG) for the channels on offer: BBC1, ITV1, E4 and Channel 4. Currently Channel 4 is just showing re-runs and short clips, while the other channels have their full content.

The ‘Lobster’ handset is supplied with a set of wired headphones which, according to the Virgin employee, also act as an aerial.

This was the point at which the customer experience began to fall apart. Having extolled the virtues of the service and explained why the broadcast technology would enable me to watch TV anywhere – trains, buses and on the street – the employee found it wouldn’t work inside the store. He suggested we take a walk outside so he could give me a proper demonstration, but again it failed.

He tried numerous times with different settings, but still it wouldn’t work.

Virgin had failed to deliver the key marketing promise of its campaign: free mobile TV for life using a technology superior to existing services. A potential marketing coup had been turned into a negative customer experience. All the investment in advertising, in-store promotion and staff training had been negated because I, as a customer, couldn’t see the benefits at the point of sale.

Unfortunately this a familiar story for the mobile telecoms industry, but Virgin’s consumer marketing experience really demands that it perform better. It is doing itself and the concept of mobile TV a disservice.

If the service is not yet reliable enough to work every time in controlled demonstration conditions, my advice to Virgin would be to remove it from sale until it is. Virgin has an excellent promotion in place and a strong marketing channel. Selling something while the customer experience is broken will damage its reputation and destroy any early-mover advantage it may have.

You can see a (working) demo of the Virgin broadcast service here.