Editor's Corner

 


The User-Generated Business Model
I suspect the launch of Sonopia won't be the last instance of a user-generated business model in the wireless space. Sonopia's plan to empower any individual, company or organization to launch their own MVNO is a bold move, but one that is met with some skepticism from an industry wary of the MVNO model. You won't see ESPN signing up, for example.

It took user-generated content to get online video offerings into the mainstream and peer-to-peer file swapping sites to alert the music industry that online music sales might be a big business. Will it take a user-generated MVNO site to make that business model work too?

Forrester Research analyst Charles Golvin seems to think so. He said that within a few years, as many as 10 million U.S. wireless users, which is just under 5 percent of all Americans with handsets, will get their service from Sonopia and its partners. While that metric is a difficult one to swallow this early in the company's official existence, others seem more promising:

It costs a carrier about $300 dollars in marketing to sign up a new subscriber. Sonopia hopes to avoid those costs altogether by relying on affinity groups that potential users already belong to, allowing their partners to do the marketing for them. Existing MVNOs like Amp'd and Helio have each required hundreds of millions of dollars to get their services up and running. Sonopia has built the tools to enable their subscribers to build the content and broadcast their respective messages, but it has only raised $9 million in funding.

Sonopia, as of this writing, boasts 529 "Sonopias" (which is what the site calls its UGC MVNOs) since launching earlier this week. It is not clear from the site how many of these Sonopias include mobile users, since anyone can create a potential MVNO on the site without actually signing up for the mobile service. We'll keep an eye on Sonopia's growth as it looks to corner that 10 million subscriber figure, and be on the look out for an MVNO targeting the avid sports fan. -Brian

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