In Verve Wireless, Founders Create a Mobile Technology Platform and a Lifeline for Local News

10/6/10Follow @bvbigelow

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targeted advertisements to their readers using mobile devices.

“Mobile content was supposed to be snackable,” says Hallinan. “What we’ve really seen is that it’s not snackable.” Media subscribers “are not reading those long Sunday stories, but they’re consuming multiple content throughout the day.”

If you think about it, this is what people do with their mobile devices. You’ve seen them checking in while they’re waiting in line at coffee shops, restaurants, and theaters.

Today Verve counts more than 750 publishers and broadcasters among its media customers, including newspapers and broadcast stations owned by McClatchey, MediaNews Group, A.H. Belo, Hearst, Belo Corp., and Advance.net. Verve says it also has partnered with many leading mobile device makers, including Apple and Nokia, as well as wireless carriers AT&T, Verizon Wireless, T-Mobile, and Sprint.

“We do not have to work with the handset manufacturers,” Kenney says. “We build mobile applications, mobile websites externally to those companies, and work with our local partners to sell, create, and deliver local mobile advertising.”

Verve generates revenue by charging a minimum fee for customers to use its software as a service platform, Kenney says. Verve’s customers share their revenue from local advertising with Verve, and Verve, in turn, shares some of its national advertising revenue with local customers. Since it was founded in early 2005, the company has raised a total of $12 million in venture capital, including $7 million in a recent round led by BlueRun Ventures.

The company, which recently moved its headquarters into a converted lumber company building in Encinitas, CA, now has about 22 employees, and is looking to expand. About half of Verve’s workforce specialize in software development, and Kenney says the startup hopes to fill eight more technology-based jobs by the end of this year. “In the end,” Kenney says, “we are absolutely a technology software development company.”

Yet to Howe, Verve also represents a lifeline for the industry he loves, as publishers go through a massive re-invention of their business. “It’s sort of like landing a plane in the Hudson River,” Howe says. “It’s pretty ugly going down, but in the end, I think everyone is going to get out alive.”

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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