Los Angeles (CA) - The specialty, youth-targeting cell phone service provider has filed for Chapter 11 bankruptcy, citing the fact that almost half of its customers were delinquent with paying their bills.

Amp'd Mobile, which specializes in offering music and video services to its customers, said it faces a "liquidity crisis".  According to court documents, around 80,000 of its 175,000 subscribers were recorded as nonpaying customers.

The bankruptcy proceedings, which Business Week reports are taking place in Delaware, say that Amp'd owes more than $100 million to creditors, with about one third of the debt owed to Verizon.  Chapter 11 bankruptcy means Amp'd will try to liquidate its current assets and reach settlements with creditors, while the company tries to continue its normal business operations.

The mid-2000s was a big time for mobile virtual network operators (MVNOs), which offer their own mobile services but borrow bandwidth from another provider.  In the case of Amp'd, it borrowed Verizon's mobile infrastructure to facilitate the normal phone operations.  

Other such services, most notably Disney's Mobile ESPN service, have also fizzled out.  According to Blycroft Publishing, there were more than 220 active MVNOs in November of last year.  Though they're becoming increasingly unpopular in the United States, MVNO services are gaining ground in Europe, thanks to support from the European Commission, which wants more competition in the mobile marketplace.

That was a very ignorant statement. ...

Jun 05, 2007 13:05     

That was a very ignorant statement.
tisk report abuse vote down vote up Votes: +0

What was a very ignorant statement?

Jun 05, 2007 14:44     

What was a very ignorant statement?
Spikke report abuse vote down vote up Votes: +0

You don't say

Jun 05, 2007 16:01     

Who would have thought a company with as retarded of commercials as they have would attract well paying customers much less have the ability to survive in the marketplace. And tisk, care to elaborate on which statement is ignorant?
David report abuse vote down vote up Votes: +0

The rest of my comment was removed because of the n...

Jun 05, 2007 23:20     

The rest of my comment was removed because of the nature of the post I was responding to. It is best that I do not repeat what that guy wrote, because it was VERY controversial and uncalled for. wes
wes report abuse vote down vote up Votes: +0

political correctness at work

Jun 05, 2007 23:46     

or plain censorship? while the first post (now it's gone) was controversial it reflected the reality much better than politically correct views of idealists living in gated communities where law & order is preserved (and paid for). the best cure for this kind of (true) ignorance is to have neighbors targeted by amp'd mobile's tv ads. while skin color should not play significant role (or so would imply the logic), the experience proves otherwise. i was expecting a heated discussion but instead some censor intervened. in the land of free (was it yesterday?). anyway, amp'd has got what it deserves. how can a business build long term strategy targeting penniless kids with very expensive service. no responsible parent would pay for this trash, no respectable adult would buy it for him/herself (so who's going to pay). i'm surprised they try to continue normal business operations - are creditors willing to waste more $ or are they true believers and wait for a miracle?

lucyfek report abuse vote down vote up Votes: +0

I'll be surprise if they didn't fail.

Jun 05, 2007 23:51     

With market focus on rapper, drug pusher and school dropouts any company short of drug cartel would fail.
Pei report abuse vote down vote up Votes: +0

I wonder who are the smart ones.

Jun 06, 2007 20:53     

Why is it that when one side brings up colour, the other is quick to condemn them for playing the race card, but that other side is always the first to bring up colour at the most inappropriate times and for the most malicious reasons. This has nothing to do with race, colour, drug pushers, penniless kids, the land of the free and parents. It has all to do with bankers, investors and suppliers who did not do their due diligence. Come on guys...get out of the dark ages.

Keith report abuse vote down vote up Votes: +0

Clueless Kieth

Jun 10, 2007 14:19     

Bankers are not the ones who are not paying their bills. I don't believe it's so much a matter of race, but rather a target market. Verizon will not give somebody an account with 3 overdue credit cards on their credit, unless they secure an outragious security deposit, and as soon as that person gets behind in the amount of the deposit, their cut off. Now AMP'd however will give anyone a phone, and be a lot more careless with their clients accounts. Most people who went to AMP'd went there because other carriers have turned them down.

Psymon report abuse vote down vote up Votes: +0

Psymon ? Bank Employee ? YES

Jun 11, 2007 22:51     

Psymon, If I ask you for 10 million dollars to grow my business selling ice and you loan me the money before discovering my target market is going to be in the Canadian North, when I default on my loan, what will you tell your bosses ? Pointing your finger at me is probably not going to save your behind. A corporation takes risks with bankers and investors money, due diligence is needed by the people who are handing over their money.

Keith report abuse vote down vote up Votes: +0