Airborne Entertainment scores $6.3 million in financing; expanding into Latin America

The co-founder and CEO of an emerging wireless entertainment service provider says a significant new financing round proves gambling on wireless content was a good bet. Airborne Entertainment Inc. has scored $6.3 million in funding from a cabal of investors, including Bell Mobility Investments and Telesystem Ltd. The funding, say Airborne executives, will allow it to beef up its current Runway content distribution platform and library of games, as well as expand into new markets. Garner Bornstein, CEO/co-founder, says wireless content has proven a growth area, but the company’s gamble on it wouldn’t have paid off if it weren’t for a strong management team with the experience to secure important North American contracts. Airborne has negotiated deals with all of the major carriers in Canada and all the major mobile operators south of the border. It says it has one of the most extensive lists of games and entertainment services to offer those service providers, offered under its PocketBoxOffice brand. This round of financing will allow Airborne Entertainment to expand into other markets such as Latin America and Europe – a major step forward for the company, says Bornstein. He explains that Latin America offers greater growth opportunities than Europe. Expansion into Europe will only come after the company begins selling into Latin America early next year. "In Latin America, I think we have an opportunity to do what we’ve done in North America, which is to be a major player that every carrier wants to have a deal with," he tells Report on Wireless.The infusion of cash from Bell Mobility proves that wireless entertainment services are considered potentially major revenue generators by the carriers, says Bornstein. The mix of investors in this round is encouraging and demonstrates the viability of these services, he adds. "Definitely, having Bell Mobility Investments’ participation clearly shows that the carriers are fully behind this," Bornstein says. "And our third major partner, whose name we weren’t able to announce, is a very major entertainment name (and) is very established in the entertainment business." Gaming to hike carrier revenue While voice constitutes the lion’s share of carriers’ revenue, data services are expected to pick up the slack in the future as voice penetration hits near-saturation levels. Further, according to Bornstein, wireless entertainment will be a major part of the data offerings the carriers are looking for. He cites the use of i-Mode in Japan as a case in point where 95 per cent of its subscribers are willing to pay premium rates for entertainment content. "I don’t think anybody sees a lot of juice left in the voice market and they’re all looking for data services to increase ARPU," he says. "And based on experience in Japan and in other parts of the world, entertainment is the predominant category by far, so we’ve got a bit of a crystal ball." Paying for wireless content solution solved with Wmode dealAirborne has also recently beefed up its overall micro-payment system through a partnership with Calgary-based Wmode, which could make wireless entertainment a profitable proposition for carriers. There is no question that managing the various types of payments such as pay-per-use, event-based billing, subscription and others can be difficult, explains Bornstein. That’s where Wmode comes into play. While the company has gained significant ground in developing various billing hooks into the carriers’ systems, it needed a robust system to manage this and to enable the introduction of flexible packages that Wmode provides instead of having to build a system from scratch, says Bornstein. "So we needed the overall management of payments and (to be able) to put together packages – three games for 25 cents for example – very flexibly and to be able to feed all these into the carriers based on the specific billing method," he says.

Airborne Entertainment scores $6.3 million in financing; expanding into Latin America

News | 12/11/2001 5:00 am EST

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