Disney to End MVNO Prepaid Phone Service by Year End

By Contributor Wireless and Mobile News on September 27, 2007 11:14 AM

The Walt Disney Internet Group (WDIG), will cease operations of its U.S.-based mobile virtual network (MVNO) phone service later this year and will instead explore a new business model for its content and services that might include offering its popular Family Center product through a partnership with a major U.S. carrier.

The Family Center suite allows users the ability to display the location of a child's handset on a map, to limit when and how the child's phone is used, and to set limits on expenditures in terms of voice and data.

All service will end by December 31, 2007.

Comment from Wireless and Mobile News:
This could be good news for kids who have been tracked by their parents, and bad news for parents who need to know where their kids are.

This is the second MVNO to go under this year. The first was the now defunct bankrupt Amp'd Mobile. The MVNO was one of the top purveyors of content for the young and broke. The Hollywood Reporter reported, "The bankruptcy filing said that nearly 80,000 of its 175,000 subscribers were "non-paying."

"It's been clear since we launched the MVNO that we were offering something both unique and useful for families that wanted to provide their kids with a mobile phone with suitable content and features while retaining a measure of control on how and when it would be used," said Steve Wadsworth, president of the Walt Disney Internet Group. "Our feedback from customers and critics from the beginning has been that we exceeded the mark in that respect. However, the MVNO model has proven, as we've seen with other companies this past year, to be a difficult proposition in the hyper-competitive U.S. mobile phone market. In assessing our business model, we decided that changing strategies was a better alternative to pursue profitable growth in the mobile services area."

WDIG, a worldwide leader in the mobile content business, is exploring opportunities with major U.S. carriers with regard to a new business model for the Family Center features.

Current Disney MVNO customers will continue to receive service and support until Dec. 31, 2007. Customers who have questions should see www.DisneyMobile.com or call Guest Services at 1-866-DISNEY2 for more information.

Disney will offer a reimbursement program for eligible customers. Additional details surrounding the reimbursement program will be available on the aforementioned Web site no later than Oct. 8, 2007.