A new risk tone for News Corp.

Steve Rosenbush
15 Sep 2006
00:00

By spending $188 million to take control of the Jamba mobile entertainment business, media giant News Corp. (NWS ) continues a pattern of investing in risky but promising new technologies.

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).

CLOUDY OUTLOOK.

VRSN

). Like News Corp.'s earlier bets, this one offers both ample opportunity and risk. Jamba is best known for marketing the Crazy Frog ringtone for wireless phones. Crazy Frog was wildly popular in 2005, but Jamba's revenues crashed as customers and regulators in Europe balked at subscription fees that confused many users. (see Businessweek.com, 9/30/05,

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). Jamba revenue soared from about $180 million in 2004 to $500 million in 2005. It's expected to generate about $300 million in sales this year. VeriSign said the revenue outlook for Jamba is stable now.

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).

DIS

) have struggled to find their footing with mobile video, according to Lin. That may start to change next year, as wireless companies deploy new technology for broadcasting video to handsets. 'But I see that as a risk for News Corp., because it could turn out to be that using the new mobile broadcast technology would make more sense,' Lin said.

MYSPACE POWER.

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