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June 28, 2006

InfoSpace sells straight to consumers

Posted by Tricia Duryee at 12:08 PM

InfoSpace is launching new Web site that sells ringtones, graphics and games straight to the consumer.

Called Moviso, the service marks the first time that InfoSpace has launched a major effort at selling directly to the consumer rather than through the wireless carrier. Previously, it sold all of its content on the wireless phone deck -- or the storefront. That's what makes the Moviso launch somewhat controversial. Some people raise questions as to why InfoSpace would take a chance at annoying carriers -- important customers to InfoSpace -- by launching a competing site.

But it's a sign that times are changing. In the past year or two, carriers have started to get comfortable with third parties selling directly to cellphone users. In this model, a user buys something online or through a short-code text message, and the charge appears on the wireless bill.

Because InfoSpace's business is so dependent on content sales, carriers must be assuming the Bellevue-based company will provide a clean-running service. Many of the first direct-to-consumer sites tricked consumers into signing up for monthly subscriptions or made billing errors, prompting customers to make costly customer service calls to the carrier.

Jim Voelker, InfoSpace CEO, said that's why he's confident that carriers won't be disheartened about Moviso. Everything goes through carriers and they will receive a portion of each sale, as well.

"They are so important," he said. "I think that's something in the press and the investment community that is understated. No matter what someone is doing, whether it's doing direct to consumer, with something like Moviso, or through the carrier decks, everything you are doing runs through the carrier and is explicitly allowed by the carrier, not implicitly."

InfoSpace acquired Moviso in 2003, a sale that also included the site Yourmobile.com. At Yourmobile.com, users were able to purchase content, as well, but InfoSpace has not supported it much since acquiring it and will instead support Moviso with all of its content and marketing dollars.

UPDATE: InfoSpace released more details today on which content providers were participating in Moviso. It said that its catalog includes content from Universal Pictures, Corbis and Getty Images, Warner Music Group, EMI Music and more.

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Tricia Duryee
Tricia Duryee
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