MySpace Parent Buys Ringtone Company
- by Mark Walsh @markfwal, September 13, 2006
News Corp. plans to merge Jamba, known as Jamster in the U.S, with its Mobizzo unit, which sells mobile versions of Fox shows including "24" and "Prison Break." The service will be part of the Fox Mobile Entertainment division.
Founded in 2000, Berlin-based Jamba has become a leading purveyor of mobile content, chiefly ringtones. Its "Crazy Frog" ringtone became a hit single in the U.K. in 2004 following an ambitious marketing campaign by the company.
Ringtones have been one of the most popular forms of content in the nascent world of mobile media, especially in the U.S. More than 10 percent of U.S. mobile subscribers purchased a ringtone in July, according to data released Tuesday by mobile market research firm MMetrics.
Only sending text or photo messages, and browsing news and information, ranked higher as mobile activities tracked by MMetrics. The firm estimates annual ringtone sales at $800 million in the U.S.
"It's a good move for News Corp.," said Seamus McAteer, senior analyst at MMetrics. "This gives them a strong horse in the direct-to-consumer mobile content arena."
Among the initial offerings from the merged Jamba will be "Simpsons"-related content including clips, ringtones and screensavers. Jamba will also market ringtones and other content to MySpace users through a new mobile store being developed with the News Corp.-owned social networking site.
Jamba had revenue of $500 million last year but VeriSign said it expects the company to generate revenue of only $300 million in 2006, according to a Wall Street Journal report.
However, Mmetric's McAteer said that News Corp. could provide the resources to help revitalize Jamba's marketing efforts and boost subscription revenue. "News Corp. is ramping up its mobile strategy across all of its properties," he said.
Verisign had acquired Jamba in 2004 for about $270 million. But the consumer entertainment service was long seen as an awkward fit with VeriSign's main Internet security business.
