Amp'd becoming a Media Company

Implications: The Amp’d focus on content delivery have implications for the following:
    · Underestimating the role of branding and distribution;
    · Over projecting the influence of customer experience with content;
    · Neglecting mobile value-added services.

Analysis: The Amp’d content-centric approach emphasizes high ARPU, but the challenge is building a brand and distribution for mobile handsets.  Virgin Mobile exploited its brand and packaged the product to succeed initially in big-box retailers.  Boost Mobile was able to utilize the Nextel distribution before the Sprint buyout.  Disney Mobile is able to cross-sell across the Walt Disney Co. customer base.  For Amp’d, the distribution has to either promote the Amp’d brand in wireless dealers against carriers, or launch a start-up campaign to sell wireless in entertainment retailers.
Amp’d is projecting that the customer experience with their content will create a demand for the handsets.  The Amp’d expansion strategy is to be a content provider or a “media company”.  The question is how large is the content market – for what percentage of mobile users is content recognized as the priority.  Does a content platform compete with mobile value-added features such as location-based services?  Customized and personalized searches will become the priority for mobile users.

For the Telus deal in Canada, Amp’d is providing the phones and content platform.  Telus manages the customer relationship in network usage and billing.  This hybrid MVNO will test the capability of content to attract and retain subscribers under the co-branding of a carrier and a content provider.  The profitability will also be tested for the Amp’d business model of being a mobile content platform.