The promise of free, advertising-funded (or ‘ad-funded’), business-to-consumer content and telecoms services has spawned a number of innovative businesses during the past couple of years. But, as the recent shift in business emphasis of two of the most high-profile players in this area – the MVNO Blyk and the online video service portal Joost – demonstrates, making ad-funded consumer services viable is not as simple as it seems.
Joost announced at the beginning of July 2009 that it would be shifting its focus from the consumer market to the business market, to become a 'white-label' online video platform. At the end of the same month, Blyk announced that it would cease to operate as an MVNO in the UK towards the end of August 2009, and would form partnerships with Orange UK and Vodafone Netherlands to offer 'new media interactions'.
This case study examines the reasons behind Blyk’s and Joost’s change of direction, while assessing their prospects in the business-to-business market.