Tuesday, September 12, 2006

The NewsCorp Juggernaut adds Jamba to the fold

The Annoying Thing GameAccording to the Wall Street Journal (via The Guardian), NewsCorp will announce today that it has bought a 51% stake in the German ringtone firm Jamba (operating as Jamster in the UK and US). Yes, this is the company behind the Crazy Frog and who spent gazillions on advertising mobile ringtone subscription services in 2004/5. News Corp will pay $187.5m (£100m) for a 51% stake in the company. Jamba's sales rose from $40m (£21m) in 2003 to a whopping $500m (£268m) last year, but will fall back to around $300m (£161m) this year, according to the WSJ. VeriSign bought Jamba in May 2004 for $273m (£146m) in cash and stock. So it looks like Verisign has made some money on the deal and it gives them an exit strategy in the future with a potential buyer in Rupert Murdoch for the whole shebang.

NewsCorp will also merge it's current mobile division Mobizzo with Jamba and put Lucy Hood in as it's CEO. Way to go Lucy - that's a fantastic position to be in. A m-commerce proposition for myspace will be delivered by Jamba and they will also soon be launching Simpsons Mobile according to the official release on the Verisign site.

I guess this is more proof that mobile media is now being taken more seriously. Time to wake up and smell the coffee marketers. Mobile ain't goin' away anytime soon.

2 comments:

  1. Indeed, but who actually said mobile was going away anytime soon?? It'll just be another carrot to lead simpler marketers in the general direction of the right direction... ;-)

    See also: NewsCorp buys MySpace (and thereafter everybody and their auntie churns out social networking/community aspects on their site/campaign).

    But given the fickleness and lack of loyalty of youth and alpha users, do first movers still have the advantage? Or should we just trash supporting innovation and see what the big guns will come up with..? What do you actually forse happening with Jamba?

    PS. When ya gonna move from Blogger? What's the plus points there or is it that they are keeping you all tied in cos of crap tech & it's not easy to migrate content?

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  2. Good points Deirdre.

    NewsCorp doesn't have first mover advantage this time (I don't believe it's a first move to be the first to buy a companyu), but it has deep pockets and a massive above-the-line and online distribution network so can create a ginormous one-stop shop. It also means they can run all their mobile services from one single point whereas Mobizzo's tech and management had been outsourced AFAIK. BUT NewsCorp isn't a fully joined-up organisation (any massive organisation is likely to be not-joined-up; people and politics...) so it's not as easy a task as it could or should be.

    There's no reason to trash innovation, and it should be supported but the big guns (i.e. old fashioned corporates) won't support it as it's too risky for them and their shareholders. Just because they have the money, doesn't mean they have the remit to do risky things. The shareholders are in it for the money and if the corporation (be it NewsCorp, Emap, ITV or whoever) risks that money in any way, especially in an industry they know little about, they are accountable and have to pay the price if it goes wrong. That's why the big boys hang around and wait to see what happens and then make their move. That's what happened this time. They dipped their toe in by creating Mobizzo, it was working, Lucy Hood pushed hard to take it forward, and to fast-track themselves, they bought Jamba. Makes a lot of sense.

    Also, mobile isn't about yoof anyway (although arguably Jamba is about yoof). Recent research by m:metrics suggests that over 25s have more spending power and more loyalty when it comes to buying mobile data products. This then begs the question as to what the over-25s market wants as it's unlikely to be the Crazy Frog. BUT NewsCorp properties like the 24 mobisodes may well hit the spot with these customers.

    Re blogger - why move?! It serves me very well. It's dead easy to post, it integrates with things like flickr, google loves it, I can customise my template without being a programmer and err, it's free.

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