NEW MEDIA: Spotlight On - Vizzavi. Vodafone gambles on adding value with content on Vizzavi

Vodafone's investment will not stop at buying the rest of Vizzavi.

It is surely time for an updated version of our occasional Vizzavi quiz. Answers may be texted using a special premium rate Campaign line. Here goes ... which of the following is correct: a) Vizzavi is an open-access, multiplatform portal; b) Vizzavi is a multimedia digital content supplier; c) Vizzavi is a wireless internet portal for Vodafone subscribers; or d) all of the above.

If you don't know what some of the above bits mean, then don't worry, you're not alone. You could argue that Vizzavi has been up there with the very best bullshit bingo players that the online industry has ever seen.

And if you want help concerning the answer to our question, d) is probably a good bet; but there are many people, not least current staffers, who fervently hope that in time, c) will be seen as the best answer of all.

Spare a thought for them. They need all the optimism they can muster.

Because at the end of August, the Vizzavi brand slid closer to oblivion when Vodafone, which already owned 50 per cent of Vizzavi, paid a rather hefty £90 million to take full control from Vivendi.

Thus another chapter closes, with Vivendi retreating further from its futuristic vision. Vivendi's erstwhile president, Jean-Marie Messier, had been building a rival to AOL Time Warner, a global empire that brought together conventional media content with new media channels, including digital interactive TV, the internet and mobile communication. Vizzavi was to be the digital glue binding the whole empire together.

Vodafone was involved because Vivendi was weak in the mobile sector (it owns SFR, which is only active in France), while across Europe Vodafone was desperate for a content partner. It seemed a marriage made in heaven.

It was actually a ferocious cash furnace, burning well in excess of £500 million over two years. In the UK alone, not content with taking on expensive offices in Shellmex House on the Strand, it drafted in the Roux Brothers to run the canteen and when someone moaned about the coffee-making facilities Starbucks was invited to help. "Never in the field of digital media has so much money been spent by so few people on so little," one former employee says.

So what now? Vodafone sources say that in broad terms, the strategy is clear. While increasing subscriber numbers becomes more difficult, the focus rests on increasing the amount of cash you can leverage out of existing customers. And that means delivering and marketing as many value-added services as possible. These include alerts (both text and picture), games and ringtones.

Marco Rimini, the director of strategy at J. Walter Thompson, a Vodafone creative agency that has taken on the Vizzavi brief, states: "I don't think it's any secret that content is an important part of Vodafone's strategy and that it is delivering as many value-added services as possible.

Vodafone is becoming a more integrated company and Vizzavi will clearly have a role in developing the content side. Our role will be advising Vodafone on how to make best use of Vizzavi in terms of its products and services and on the future role of the brand."

But some observers say this is all still a desperate gamble. To recoup the silly money they bid to acquire 3G licences, mobile operators need to extract sums well in excess of £1,000 a year from each customer. On the other hand, they don't look like retreating. What's another couple of hundred million between friends?

And indeed there has been speculation that it could be business as usual, with Vodafone continuing an ambitious investment strategy - sinking a further £350 million with a view to achieving break-even at Vizzavi in 2004.

While Vodafone refused to speak to Campaign, few Vizzavi insiders really believe that. One insider says: "At this stage, the feeling is that we'd be absolutely astounded to see the Vizzavi brand survive. The initial vision was a portal that you could access via interactive TV or through ordinary mobile phones or through WAP-enabled phones. One by one all those things have fallen away. There's no pan-European interactive television, no WAP - and Vivendi couldn't care less about other mobile services. What they ended up with was an internet site. So unless they could do something with that site that has never been done before they weren't left with very much. Is the brand itself worth anything to Vodafone?"

However, it is the only digital media brand that has been designed, presented and marketed in exactly the same way in every major market in Europe. That has to be weighed in the balance, doesn't it?

Well, perhaps. Jon Sharpe, the managing director of itraffic, states: "It's a mildly confusing departure from Vodafone's business focused strategy, but Vodafone is certainly better placed to perform the role of sole parent rather than co-partner. Vizzavi has lately become a messaging pure-play, which is something Vodafone can leverage seamlessly across its global network and infrastructure. Vodafone will also absorb Vizzavi into its own infrastructure, resulting in reduced costs, increased efficiencies and, crucially, a chance to claw back optimum revenues via messaging. It is extremely likely that Vizzavi will eventually disappear within one of the Vodafone entertainment sub-brands."

And Nick Suckley, the managing director of, tends to agree: "The main lesson is that it's very expensive to set up a new brand, especially if, from Vodafone's point of view, it already has a hugely strong brand itself. I can't see any reason why it would want to maintain the Vizzavi brand. My advice would be to ditch it."