Merrill Lynch to Disney: Shut down Mobile ESPN

Merrill Lynch this week issued a note to investors saying that "it is time for Disney to pull the plug on Mobile ESPN." Since its high-profile launch during Super Bowl XL, Mobile ESPN has attracted few paying subscribers. Disney CEO Bob Iger said in May that "it is clear that the jury is still out" on the future of the MVNO, but that Mobile ESPN had revamped its pricing and marketing approach. But Merrill Lynch seems to think the tweak won't be enough. The firm estimates that Mobile ESPN will attract 30,000 subscribers over the course of its financial year, well below the original estimate of 240,000. Along with the losses generated by a second Disney-branded phone service, Merrill Lynch expects Disney will lose $135 million on its experiment in fiscal year 2006. Mobile ESPN says it doesn't have any plans to end service.

As one analyst pointed out to me, Mobile ESPN could turn into a very interesting brand/content MVNO case study down the road.  

To read more about Merrill Lynch's views on Mobile ESPN:
- check out this article from Mediaweek


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