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| '''InPhonic Inc''' was an ] company which sold wireless services and devices ], both through its own ] sites and through private labeled websites it created and managed for online ]ers. InPhonic was founded by ] who resigned in 2007 due to |
'''InPhonic Inc''' was an ] company which sold wireless services and devices ], both through its own ] sites and through private labeled websites it created and managed for online ]ers. InPhonic was founded by ] who resigned in 2007 due to horrible debt management and rapidly decreasing revenues. Its board of directors included former Vice-Presidential candidate ] and technology/marketing guru ] (of ] and ] fame). | ||
| On November 8, 2007, InPhonic filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The filings were made in the U.S. Bankruptcy Court for the District of Delaware. The company's stock was later delisted by NASDAQ. Many of the assets of Inphonic, including its ] operations and its Wirefly web site, were subsequently sold to private investors. | On November 8, 2007, InPhonic filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The filings were made in the U.S. Bankruptcy Court for the District of Delaware. The company's stock was later delisted by NASDAQ. Many of the assets of Inphonic, including its ] operations and its Wirefly web site, were subsequently sold to private investors. PT Barnum would have been proud that his axiom, that "a sucker is born everyday," still applies. | ||
| The company was modeled after sites like Expedia, gathering information from companies into a single site to help customers find deals by comparing services and prices. Wireless carriers did business with InPhonic because acquiring a customer through the company can be less expensive than traditional marketing approaches designed to generate sales at a brick-and-mortar store. InPhonic, in turn, received a commission from carriers for each new account generated, once the customer met a number of criteria. InPhonic helped grow this market for third-party activations to nearly 50% of all newly acquired cell phone subscribers in the U.S. | The company was modeled after sites like Expedia, gathering information from companies into a single site to help customers find deals by comparing services and prices. Wireless carriers did business with InPhonic because acquiring a customer through the company can be less expensive than traditional marketing approaches designed to generate sales at a brick-and-mortar store. InPhonic, in turn, received a commission from carriers for each new account generated, once the customer met a number of criteria. InPhonic helped grow this market for third-party activations to nearly 50% of all newly acquired cell phone subscribers in the U.S. | ||
Revision as of 17:04, 21 March 2008
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| Industry | Wireless |
|---|---|
| Founded | 1999 |
| Founder | David A. Steinberg |
| Headquarters | Washington, DC, USA |
| Area served | USA |
| Key people | David A. Steinberg, John Sculley, Jack Kemp, Ira Brind, Lawrence E. Harris, Blake Bath |
| Products | Cell phones and wireless plans |
| Revenue |  $320.5 million USD (2006) |
| Net income |  $38.2 million USD (2006) |
| Number of employees | < 1,000 |
InPhonic Inc was an American company which sold wireless services and devices online, both through its own electronic commerce sites and through private labeled websites it created and managed for online retailers. InPhonic was founded by David A. Steinberg who resigned in 2007 due to horrible debt management and rapidly decreasing revenues. Its board of directors included former Vice-Presidential candidate Jack Kemp and technology/marketing guru John Sculley (of Pepsi Co and Apple Computer fame).
On November 8, 2007, InPhonic filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The filings were made in the U.S. Bankruptcy Court for the District of Delaware. The company's stock was later delisted by NASDAQ. Many of the assets of Inphonic, including its electronic commerce operations and its Wirefly web site, were subsequently sold to private investors. PT Barnum would have been proud that his axiom, that "a sucker is born everyday," still applies.
The company was modeled after sites like Expedia, gathering information from companies into a single site to help customers find deals by comparing services and prices. Wireless carriers did business with InPhonic because acquiring a customer through the company can be less expensive than traditional marketing approaches designed to generate sales at a brick-and-mortar store. InPhonic, in turn, received a commission from carriers for each new account generated, once the customer met a number of criteria. InPhonic helped grow this market for third-party activations to nearly 50% of all newly acquired cell phone subscribers in the U.S.
The company's central online storefront, Wirefly.com, received a number of Internet awards, including Forbes magazine's "Best of the Web" for 2004 and Keynote System's "Best In Overall Customer Experience" in 2005.
In addition to operating Wirefly.com, InPhonic powered the technology platform and fulfillment system of 6,000 other private label cell phone sales Web sites, according to company spokesman Tripp Donnelly. In early 2006, the firm claimed that it was the largest third-party online cell phone retailer in the US, accounting for one-third of the market, and that it sold 850,000 cell phones in 2005 alone. In June 2006 the company said that it had completed more than 2.5 million cellphone activations in the past three years.
The company was headquartered in Washington, D.C. and maintained technology and operations centers in Largo, Maryland and Reston, Virginia.
Financials
In September 2001, the company closed a $19 million Series D round of capital financing headed by Core Capital Partners. The investment also included new investors McAndrews & Forbes, First Analysis, Spring Capital and Wynnefield Capital. All previous investors -- including Sculley Brothers Investments, CMS Financial Services, and Mid Atlantic Venture Funds -- participated as well. In 2003, Technology Crossover Ventures invested an additional $56 million in the company.
The company went public in November 2004. The company raised $108.9 million through its initial public offering. The IPO was InPhonic's second attempt to tap the public markets; the company filed to go public in 2002 but canceled the offering because of stock market conditions at the time.
In November 2006, Goldman Sachs one of InPhonic’s largest shareholders, made the company a proposal to provide it with $100 million in debt financing, part of which InPhonic used for a large stock buy-back .
In November 2007 InPhonic filed a Chapter 11 petition in the United States Bankruptcy Court for the District of Delaware. InPhonic, along with its co-debtors, requested that their cases be jointly administered under case number 07-11166. . In December 2007 the company's stock was delisted by NASDAQ.
InPhonic attributed its bankruptcy filing, in part, to a recent default under a prepetition credit agreement, as well as illiquidity and declining revenues caused by unprofitable marketing activities and an inability to maintain adequate inventory of the most popular wireless devices. InPhonic’s top creditor list reads like a who’s who of the nation’s top technology companies. MSN, Yahoo!, Google, America Online and Verizon all rank among the debtor’s top ten creditors.
Some cell phone sites which InPhonic operated
A1 Wireless
ACN Wireless
AOL Mobile
BestBuy.com
Blackberry.com
Buy.com
Cellular Buys
Cellular Choices
Corporate Wireless
FonCentral
INTELENET Wireless
LG.com
Liberty Wireless
lowcostcells.com
Mobile Pro
Motorola.com
MSN Mobile
Overstock.com
Phone Deals
RadioShack.com
Samsung.com
Staples.com
StarNumber, Inc.
Tiger Direct
TMI Wireless
Wirefly
Wireless Marketplace
WorldPerks Wireless Service
Younevercall.com
Rebates
A large number of InPhonic's customers complained about the non-fulfillment of rebates that were promised to customers. Many of these customers were listed as nonsecured creditors in the company's Chapter 11 filing in 2007.
Partnerships and affiliates
InPhonic had established relationships with a range of e-commerce partners to provide wireless activation services. Its partners included high-profile brands such as Radio Shack, BestBuy, Overstock.com, Buy.com and AOL; industry players like Cognigen Networks and Intelisys,; and major U.S. carriers Verizon Wireless, Cingular, Sprint, T-Mobile, Alltel and others. InPhonic also ran fulfillment for original equipment manufacturers like the Motorola and LG brands.
A deal signed with Disney in April 2006 was the first deal for the company's mobile virtual network enabler (MVNE) division after the company shed its own mobile virtual network operator (MVNO), Liberty Wireless, in 2005.
In April 2006, InPhonic finalized a partnership with Amazon.com to become Amazon's first third-party provider of wireless products .
External links
- BBB Reliability Report of InPhonic
- Cell phone firm sued after Red Tape coverage
- Consumers irked by cell phone rebates on hold
- Washington Post profile of InPhonic
- InPhonic Settles Lawsuit Over Rebate Restrictions, Washington Post, November 7, 2006.
- Order Consolidating Class Actions against InPhonic in District of Columbia
- InPhonic corporate site including links to InPhonic bankruptcy filings