CLEARWIRE CORP. IS GEARING UP to put pen to paper on a deal that will bring Amp’d Mobile Inc’s. 50-plus member content team on board to lead a new content offering under the Clearwire brand.
The move likely would give Clearwire a major boost in content offerings, as thus far it has focused on building up its business as a fixed-wireless broadband service provider. Through the partnership, Clearwire would be positioned as an entertainment-minded company steadfastly focused on its network and service, particularly thanks to its recent partnership with Sprint Nextel Corp. to build out a nationwide mobile WiMAX network.
Clearwire declined to comment on the deal and the Amp’d Mobile content team is following those cues.
“It’s certainly a big win for Clearwire because I think what Amp’d had there was clearly one of the most compelling data offerings out there,” said Roger Entner, senior VP of the communications sector at IAG Research. “As good as the team is, it doesn’t have the track record of saving companies, of reversing the doom of the company, but Clearwire’s prospects have substantially improved with the deal they have with Sprint.”
The Amp’d Mobile crew had been shopping themselves out as a cohesive unit to a variety of heavyweights in the wireless space. Considering that back-end problems like billing led to the demise of Amp’d Mobile’s mobile virtual network operator business, it makes sense that the team would look for a partner that already has a network up and running. Such a pairing would enable to team to focus on what it calls the “front end” of operations.
“I feel like Clearwire was opportunistic on this one. They brought in the people that really understand content,” said Levi Shapiro, director of audience metrics at Telephia Inc. “The guy is a winner. Time and time again (Clearwire Chairman and CEO Craig McCaw) finds a way to crush his competition and win. He’s a guy you don’t ever want to compete against.”
Shapiro said he was surprised at the Clearwire-Amp’d Mobile pairing, but since the team coming on board appears to be the brains and muscle of the failed MVNO, it could quickly forge a powerhouse in business and content.
“They might have gotten lost in a Viacom or MTV Networks,” he added. “A friend in need is a friend indeed and the two of them complement one another.”
Connected for content
The Amp’d Mobile team inked some noteworthy partnerships with veteran Hollywood talent on made-for-mobile content at Amp’d Live and it appears the team will likely follow suit with those same relationships largely intact, even if they’re not spelled out in contracts yet. Furthermore, since the deal would bring not only the content team on board, but also its culture and business philosophy, the unit would likely continue to pull other content from aggregators while pursuing the production of made-for-mobile offerings on a parallel track.
“It will clearly help them on the content side; it’s just that content is not one of the top two or three decision factors. It’s price, quality and service,” Entner added.
“Clearwire definitely has something to prove,” Shapiro said.
Because Clearwire is rather bullish on the technology side, most obvious in its mobile WiMAX plans, the cross-platform opportunities inherent in the deal would also enable the Amp’d Mobile content team to extend what it started with Amp’d Live to a variety of new venues.
As for the Amp’d Mobile team hedging its bets on WiMAX, Entner and Shapiro seem to think the collaboration might be just the right mix to take calculated risks while building brand awareness.
“There’s a lot of uncertainty that WiMAX is real and so by coming to the market with content they get the consumers attention,” Shapiro said.
“I think it’s equally as proven or unproven as the Amp’d model. It’s virgin territory, but these guys are risk takers,” Entner said.
“You have a really fast pipe. Your biggest challenge as a WiMAX provider is how are you going to fill up that pipe,” he said. “People don’t typically pay a premium for faster download speeds. You know, what else is there? The biggest broadband hog where you can actually raise prices is television. We all bite the bullet and pay more every year for our cable TV.”
