Amp'd Mobile Files for Bankruptcy
Mobile Virtual-Network Operator Said It Expects to Continue Normal Business Operations
By Todd Spangler -- Multichannel News, 6/4/2007 6:12:00 AM MT
Amp’d Mobile, the mobile virtual-network operator focused on selling TV and other entertainment content on wireless phones, filed for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court in Delaware Friday.
The company, in a statement posted on its Web site, claimed that it filed for bankruptcy because, “as a result of our rapid growth, our back-end infrastructure was unable to keep up with customer demand. We are taking this step as a necessary and responsible action to sustain and strengthen our momentum in the marketplace.”
Amp’d, founded in December 2005, targets an 18-34 male demographic with a service geared around providing video, games and music. The Los Angeles-based company has reported having close to 200,000 subscribers.
The Chapter 11 filing came a little more than one year after Amp’d announced that it had raised $150 million in third-round funding, bringing it to a total of $360 million. Investors in the mobile venture include Tudor Ventures, Intel Capital, Rho Ventures, Qualcomm, The Quilvest Group, Polygon Investment Partners, Heights Capital Management, MTV Networks, Universal Music Group, Highland Capital Partners, Columbia Capital and Redpoint Ventures.
According to its bankruptcy filing, privately held Amp'd has more than $100 million in debts. It owes $33 million to Verizon Wireless for the use of its network; about $16 million to Motorola for phone handsets; and about $8 million to retailer Best Buy.
Amp’d, in its statement, said it expects to continue normal business operations throughout the reorganization process. “We are committed to assuring that Amp'd Mobile services remain uninterrupted and will continue to provide our customers with the best service possible,” the company added.
Amp’d gained notoriety for its original series for mobile phones, including parody Lil’ Bush. One of its key partners is Viacom, which picked up Lil’ Bush as a series on Comedy Central.
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