Emblaze (LSE: BLZ) subsidiary Emblaze Mobile Ltd. last signed an exclusive contract to sell specifically branded handsets to virtual wireless operator ROK Mobile MVNO of the UK, in a $150 million deal spread over three years. This is a huge deal relative to the average size of an Emblaze Mobile contract. ROK Mobile, a mobile virtual network operator (MVNO), is part of the ROK Entertainment Group, a provider of content services for handsets.
ROK Mobile currently has 250,000 subscribers. It plans to sell Emblaze Mobile handsets to 250,000 subscribers in the first year, and to sell handsets to one million subscribers within three years. The revenue potential for Emblaze Mobile is therefore apparently $37.5 million in the first year. For the sake of comparison, Emblaze Mobile posted $30-35 million in revenue in 2004 as a whole. ROK Mobile hopes to reach one million subscribers within a year. Since Emblaze Mobile has an exclusive contract to sell handsets to ROK Mobile, presumably Emblaze Mobile's revenue will grow in line with the increase in ROK Mobile's subscribers.
Under the contract, Emblaze Mobile will work together with ROK Mobile to define the exact handsets that they will distribute, which will be bundled with content preloaded onto memory cards and then sold on through distribution channels in the UK. The first branded handsets are expected to come on the market before the end of August this year.
Emblaze Mobile's new focus is stylish, lifestyle handsets tailored for individual consumers. It recently acquired Korean handset plant Innostream, which provides Emblaze Mobile with a large manufacturing capability.
Founded in 2002, ROK Mobile is a distributor of handsets and licenses. In addition, ROK has filed trademarks on DVC (Digital Video Chip), DMC (Digital Music Chip), and DCC (Digital Content Chip). ROK Mobile has 130 employees at its offices in the UK, Houston, Los Angeles, and Beijing. ROK Mobile and the Beijing Municipal Government operate ‘ROK New Net’ as a joint venture. ROK has mobile content supply agreements with many of the worlds leading wireless operators.
Published by Globes [online], Israel business news - www.globes.co.il - on May 3, 2005