Wireless ASP GiantBear Snags $25M
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Wireless application service provider GiantBear Inc. has closed a $25 million second round of funding, led by First Union Capital Partners.
"I believe that their (First Union Capital Partners) commitment is further evidence that GiantBear is well positioned in the emerging wireless data marketplace," said Steven Price, co-founder and chairman of GiantBear, in a prepared statement.
Kurt Abkemeier, GiantBear's chief financial officer, said the funds would be used to build up the company's infrastructure.
"We'll be using the money for general corporate purposes and to roll-out mobile services to the carrier market over the next year," he said.
The funding is significant as it comes at a critical time for wireless ASPs and indeed to the Internet sector as a whole. Industry analysts have predicted that wireless may never catch on in the US, as it has in Europe. Meanwhile, online advertising spending -- a source of revenue for wireless Internet content -- is down, while many content providers themselves have gone under in recent months.
But GiantBear said it is poised to capture an enormous niche of mobile cell phone users -- between 90 to 100 million people -- who are hungry for basic Internet content; including news and stock quotes, but who are unable to access information through existing analog or digital mobile phones.
GiantBear's BearCub application would permit non-WAP (Wireless Access Protocol) enabled digital mobile users to download customized content directly from the company's web site through its short messaging service technology. Analog mobile users would receive similar content in audio via the company's AudioCub application.
Abkemeier said that GiantBear takes the opposite perspective of many current wireless ASP's by giving customers control of content. "We're going to let the customer pick out what they want and put it right on top of their phones."
GiantBear's applications are now available to 2.5 million mobile phone users through several regional phone carriers. Last week the company finalized a deal with Prodigy to provide product distribution to the company's users. Earlier reports had incorrectly identified the deal as having been struck with Cingular, said Abkemeier, who refused to comment further until the deal is made public next week.
First round investors Thomas H. Lee Partners and Blackstone Capital Partners contributed to the current round of funding, as did LiveWire Ventures, LLC and Waller-Sutton Media Partners, among others.