#TBT: The demise of Amp’d Mobile; Navigating the road to mobile marketing; Playing in Sprite’s yard … this week in 2009

5G Top Stories

Editor’s Note: RCR Wireless News goes all in for “Throwback Thursdays,” tapping into our archives to resuscitate the top headlines from the past. Fire up the time machine, put on the sepia-tinted shades, set the date for #TBT and enjoy the memories!

Reconstructing the demise of Amp’d Mobile
Amp’d Mobile Inc. blamed its rapid growth, back-office systems and collection problems as the reasons for its need to reorganize under Chapter 11 bankruptcy, and said that nearly half of its youthful customer base were not paying their bills by early 2007, according to the company’s bankruptcy filings. According to the filings, Amp’d had raised about $350 million in investment money and had about $31 million in debt investments. The company began to run into troubles after it hit the 100,000-subscriber mark in late 2006. Amp’d said that about 90% of its customers were on 18-month postpaid service contracts, and in early 2007 the company “began to find a host of credit and collections problems and contributed ultimately to a liquidity crisis.” The MVNO tried to address the issues, Amp’d said, but “its business model could not sustain such revenue collections problems.” By May, the company estimated that it had about 80,000 non-paying customers-or nearly half its customer base, given that the MVNO said it was close to reaching 200,000 subscribers at that time. Amp’d tried to raise more money, hoping to stave off the reorganization, but a last-ditch effort fell through when Verizon Wireless demanded a $4.5 million payment and accused Amp’d of defaulting on its wholesale agreement. Verizon Wireless then sent a letter terminating the company’s wholesale agreement and threatening to disconnect Amp’d subscribers from its network. On the same evening Amp’d received the letter from Verizon Wireless, the company filed for bankruptcy protection. … Read more

Google Checkout comes to WAP
Google Inc. is jumping onto the crowded m-commerce field with a wireless version of its Checkout service. Google Checkout, which launched a year ago, is a PayPal-type offering that allows users to make purchases online from partners including Toys “R” Us, RadioShack Corp., Dick’s Sporting Goods and Starbucks Coffee Co.. Vendors with WAP sites can use the new service to consummate transactions on mobile phones. “We’re just starting to explore the possibilities for Checkout on this new platform,” Google developer Peisun Wu posted on the company’s Web site. … Read more

ITC deals Qualcomm a blow
In a potentially serious blow to Qualcomm Inc.’s chipset and IP-licensing business, the U.S. International Trade Commission ordered a ban on new 3G handsets bearing Qualcomm chips that infringe on a Broadcom Corp. patent. The ruling could also have wide-ranging effects on the U.S. wireless industry. It was not immediately clear what brands and models of mobile handsets would be affected by the order, which applies to handsets imported after today that contain the offending Qualcomm chip. In a conference call after the decision was released, Qualcomm executives appeared to indicate that the detailed text of the ITC’s majority opinion in the case would have to be reviewed to determine which handset vendors and handset models would be affected. That could provide a better sense of how the ITC decision may affect Qualcomm’s core financial results. The order-characterized as a “downstream remedy” because it addresses not only the offending chips but products containing them-exempts handsets with the offending chips available until today or the same models available after today. The ITC’s majority found that, because the offending chips are incorporated into handsets overseas, then imported, banning the chips alone would not provide a material remedy to Broadcom. … Read more

MVNO Firefly Mobile comes to Kmart
Firefly Mobile, maker of the Firefly mobile phone designed for children, said its gadget is now available at Kmart stores nationwide. The news is notable as Firefly lost a major distribution channel when AT&T Mobility dropped the Firefly from its lineup. The phone, targeted at children between the ages of 5 and 9, comes with a charger and a backpack clip and includes 30 minutes of airtime. The phone retails for $50. The Firefly phone allows parents to control what numbers the phone can call and receive calls from. … Read more

Sprite gets its own yard
NEW YORK-Coca-Cola Co. is moving aggressively onto the mobile marketing playground with a kind of mobile MySpace centered on the company’s Sprite brand. The soft drink titan plans to launch a worldwide community allowing users to create profiles and exchange photos and messages, executive Mark Greatrex said during the keynote address at the Mobile Marketing Forum in New York. The free downloadable application, dubbed “Sprite Yard,” will be available via a short code and also offer wallpapers, games and video clips. The effort launched in China last week and is set to launch in the United States beginning June 22. To access the application, U.S. consumers can text “YARD” to 59666 and receive a reply with a WAP link to access the Sprite Yard for the fist time. Coca-Cola hopes to offer the application in “many more countries” next year, Greatrex said. … Read more

The road to mobile marketing
NEW YORK-There was, of course, no shortage of hype at last week’s Mobile Marketing Forum in New York. But that enthusiasm was tempered by a surprising amount of restraint. EJL Wireless Research predicts mobile advertising will generate $9.5 billion worldwide by 2011, with the U.S. market accounting for about one-fourth of overall revenues. Strategy Analytics Inc. is even more optimistic, forecasting a $14.4 billion market for worldwide mobile advertising by 2011. For those sky-high projections to be anywhere near accurate, though, the wireless industry will have to work with ad agencies, brands and other outsiders to overcome some substantial hurdles. And they’ll need to grow the audience and increase traffic on the wireless Web, according to John Hadl, CEO of Brand in Hand. “Gold is audience,” Gadl told attendees during a keynote speech. “Marketers don’t buy tools, they want gold. For many of you, the challenge is how do you convert tools into audience? That is how you’re going to get money out of marketers.” Brand in Hand serves as a kind of liaison between major brand marketers and a handful of mobile companies. Hadl, who also acts as the strategic advisor to Procter & Gamble’s mobile marketing group, said companies in the wireless industry need to understand that mainstream advertisers aren’t necessarily interested in eye-popping applications. Instead, they want to reach as many consumers as possible-which means the mobile Internet is a lesser priority in advertising budgets. Most market data indicate less than 20% of U.S. subscribers are surfing the wireless Web, and some studies suggest that even that seemingly modest figure may be inflated. Carriers and software developers might be able to boost those numbers by making it easier for users to get on the wireless information superhighway-and by delivering content more quickly. … Read more

MobiTV gets music videos
MobiTV bulked up its content library with a deal to license more than 2,500 music videos from Sony BMG Music Entertainment. The wireless video provider said it will put the videos into rotation “immediately” on its music channels, expanding its portfolio to 7,000 music videos. The companies also said they will collaborate to develop customized channels of original video programming including long-form concerts and artist-created programs. Financial terms of the deal were not disclosed. “We’re delighted to be working with MobiTV as we continue to build our presence in the mobile space,” said Sony executive Thomas Hesse. “We look forward to working closely with them as we explore a wide range of innovative programming concepts.”
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Check out the RCR Wireless News Archives for more stories from the past.

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