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ESPN's Cell-Phone Fumble

Mobile ESPN had 30,000 customers, way below breakeven

In its 27-year history, ESPN has pushed its brand with the ferocity of a linebacker on steroids. And mostly it has emerged with big wins. But the sports entertainment giant recently admitted to a rare failure in brand extension. Just seven months after launching its own cell phone and service on Super Bowl Sunday, ESPN abruptly announced it was scrapping its heavily hyped Mobile ESPN.

Becoming your own cell-phone provider--leasing wireless spectrum from one of the big carriers and delivering programming directly to customers--is not for the faint of heart. Very few Big Media brands attempt to become an MVNO, or mobile virtual network operator. ESPN, the $5 billion-a-year jewel of Walt Disney Co. (DIS ), takes pride in knowing what sports fans like and how they want their games, highlights, and analyses served up. Yet despite investing nearly $150 million in Mobile ESPN, say industry sources, the company signed up just 30,000 subscribers, way below a possible breakeven mark of 500,000.