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Blyk Stalls UK Launch

Michelle Donegan
LR Mobile News Analysis
Michelle Donegan
7/9/2007
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The U.K. launch date for ad-funded mobile service Blyk has slipped, though the startup's CEO is maintaining a "business as normal" stance.

The service provider's founder and CEO Pekka Ala-Pietilä tells Unstrung that the service will launch in the summer of 2007, the timeframe stated in May.

But Blyk's press relations team has broken ranks with its client, and says the service won't meet its original launch date. (See Blyk Preps Summer Launch and Blyk Plans UK Launch.)

"I know it won't be launching in August as scheduled," says a Blyk spokesman. "We don't have an official launch date."

That admission followed a report in today's Guardian newspaper, which stated that the mobile virtual network operator (MVNO) has delayed its ad-funded service by several months and isn't expected to launch until October.

Any number of factors could be delaying the service's launch, but Ala-Pietilä, the former president of Nokia Corp. (NYSE: NOK), would not be drawn on what aspect of the service needs the most attention right now. (See Nokia Changes Management.)

"When you are launching something you have to make sure that all the elements get a similar amount of attention... so that there is a complete experience for the consumers and advertisers," says Blyk's CEO. "You cannot single out any particular part as less significant."

Blyk will offer free calls and texts in exchange for receiving relevant advertisements -- initially targeted SMS messages -- based on user profiles and usage patterns. The service will be aimed at young people aged between 16 and 24.

Blyk has outsourced network operations to Nokia Networks and has an MVNO agreement with Orange UK . The mobile advertising platform comes from First Hop Ltd. The advertisers that are already on board include Buena Vista, Coca-Cola, I-play Mobile Gaming, L'Oreal Paris, StepStone, and Yell.com. (See Blyk Outsources to NSN and First Hop Pushes Ads.)

But what could hold up the service?

For one thing, Blyk is Orange's first MVNO partner in the U.K. According to one industry source, Blyk's service was always unlikely to launch on schedule because of Orange's lack of MVNO experience in Britain.

On the business side, the operator may not have finalized the tariff plans. The service won't be entirely free, and the line between free versus paid-for minutes and texts could be difficult to draw. But getting the tariffs right will be critical for this service because its youthful audience is particularly price sensitive.

In addition, Blyk is breaking new ground in the mobile advertising space. Getting relevant ads to consumers at the right time is new for advertisers as well as for the back office systems that will support Blyk's marketing plans.

One advertiser views Blyk as something of an experiment.

"Nobody really knows exactly what is the right mix of channels for promoting mobile applications and services," says Carey Bunks, senior vice president of business development at Yell.com, one of Blyk's advertisers. "Blyk is one of the things we want to try out."

— Michelle Donegan, European Editor, Unstrung

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