Will other mobile operators create similar services? How can they avoid canibalizing what they already have? How successful are the existing Virgin and 7-11 services?
Telus dials into a young, growing market
Saturday, August 05, 2006Telus dials into a young, growing market
Until now, Telus Corp. chief executive officer Darren Entwistle has stood on the sidelines as rivals joined forces with well-known consumer brands to launch new wireless services.That changed Friday when Mr. Entwistle announced an agreement to bring the Amp'd Mobile brand to Canada next year.
It's the right time and right partner to make such a move, Mr. Entwistle explained in a phone interview. The deal gives Telus an opportunity to expand its vital wireless business by extending its reach in the youth market. It's a niche Amp'd Mobile has targeted in the United States by stuffing all kinds of entertainment content into cellphones.
Virgin Mobile Canada and Loblaw Cos. Ltd. use Bell Mobility's wireless network, while 7-Eleven Canada Inc.'s Speak Out Wireless service uses Rogers Communications Inc.'s Fido network.
A good fit is crucial as Vancouver-based Telus aims to enhance, not cannibalize its own brand, according to Mr. Entwistle. In Canada, the service will be branded as Amp'd powered by Telus.
"The one complements the other, and as a result the whole is greater than the sum of the parts," Mr. Entwistle said.
In addition to the agreement in Canada, Telus is investing $7.5-million (U.S.) in the U.S. parent, Amp'd Mobile, Inc., joining investors like MTV and Universal Music.
Wireless is a crucial business for Telus, which depends on it to offset a shrinking local and long-distance phone business. The company Friday reported an 88-per-cent increase in second-quarter profit, driven by higher demand for wireless and high-speed Internet services, along with tax adjustments.
Consumer brands are looking to tap into that growth and slowly entering the wireless business. But building a wireless network is too costly, so they strike deals with the phone companies and become a mobile virtual network operator, or MVNO. Posted by BR at August 6, 2006 09:19 AM