Vizzavi’s wild ride seems to have come to an end. At least, sort of.
Wireless giant Vodafone Group and media titan Vivendi Universal founded the European portal in January 2000 with a whopping US$1.6 billion investment. But Vizzavi, touted as a multi-access Web/mobile-phone entertainment portal, has not lived up to expectations. Indeed, the companies revised Vizzavi’s business model earlier this year and cut 100 jobs from the venture.
Late last month, Vodafone bought out Vivendi’s stake in the venture for about US$141 million, a move some think will bring some needed stability to Vizzavi. The move was widely expected-Vivendi is struggling with a total debt load of a staggering US$18.8 billion and has begun selling many of its assets. Further, as the Internet advertising business petered out, more of Vizzavi’s revenues came from the wireless side of its business.
“I think Vodafone taking over the whole venture is a positive,” said Eden Zoller, a senior analyst at the research and consulting firm Ovum.
Zoller said Vizzavi’s ultimate goal of becoming the MSN or Yahoo of Europe never materialized, and Vivendi’s stakeholders were never 100 percent behind the venture. Zoller said Vizzavi has been somewhat adrift, struggling under the disparate goals of its parent companies.
“Since launch, it’s not really had direction,” she said. “I think Vivendi and Vodafone had very different ideas of where Vizzavi would go and what it would be.”
Although it comes from troubled lineage, Vizzavi has been able to make a relatively comfortable place for itself. Early this year it counted around 6 million wireless users, a healthy figure for a wireless portal. But the market for wireless data services is heating up, with several new rivals coming into the scene.
Perhaps the most notable entrant into the European portal market is KPN, which is selling a European version of Japanese giant NTT DoCoMo’s popular i-mode service. KPN reports more than 100,000 customers in the Netherlands and Germany, and expects to reach 1 million customers by next year. As other operators launch multimedia-capable phones and service, Vizzavi could see even more pressure.
As the market heats up, it is unclear exactly what Vodafone plans to do with its full ownership of Vizzavi. A Vodafone spokesman said it is too early to know what the carrier’s ultimate plans for the portal will be.
Ovum’s Zoller said dropping the Vizzavi name could be a good move. She said the Vizzavi brand was never pushed hard, and that Vodafone has been “gentle” in rebranding its other acquired properties.
“I wouldn’t get too hung up on the branding,” Zoller said. “I don’t see why it should hinder much. Rebranding can work, as we’ve seen with MmO2.”
Vodafone offered a hint into the possible future of Vizzavi. In its release announcing the purchase of Vivendi’s Vizzavi stake, the carrier mentioned a new consumer service, dubbed Vodafone Live!, that it will launch during the next few weeks. Vodafone said Vizzavi’s content assets “are of particular important to the launch” of the new service.
A Vodafone spokesman declined to provide details on the new service, but described it as a new “consumer-oriented interface.” GW
