Qualcomm Inc., the largest maker of chips that run mobile phones, plans to shut its wireless FLO TV service in March and will offer rebates to subscribers who bought related products for program viewing.
The company had previously said it would stop taking new subscriptions after the venture failed to meet its targets. Qualcomm has held talks with AT&T Inc. about a possible sale of the wireless spectrum it bought to create FLO, two people with knowledge of the discussions said last month.
FLO was an attempt by Qualcomm Chief Executive Officer Paul Jacobs to diversify the company’s sources of revenue outside chips and licensing and stoke general demand for television on the go. Consumers proved less attracted by FLO’s live programming than by shows that can be viewed on-demand, the executive said in an interview Nov. 17.
Qualcomm paid $683 million for rights to use the needed airwaves -- in the 700 megahertz band -- in federal auctions from 2003 to 2008, and started Flo TV in 2004 to let users watch broadcast TV on their mobile phones. Qualcomm made the rebate and closure announcement on FLO’s website. In November the company said it expected to incur charges of $125 million to $175 million in fiscal 2011 to exit the Flo TV business.
Qualcomm rose 40 cents to $49.48 at 4 p.m. New York time in Nasdaq Stock Market trading. It has gained 7 percent this year.
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