A Quick Slick Unpick of Blyk’s 2-Sided Business Model Trick

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We thought it might be helpful to review the Blyk business model in a bit more detail following our pre-launch analysis where we were bearish on the company. Its business model ties in nicely with our 2-sided strategy for operators about which we have written on numerous occasions on the Telco 2.0™ blog.

This piece, therefore, seeks to answer the following questions:

  • How does Blyk make money?
  • What are the benefits and risks of the business model? (Are we still bearish?)
  • What are the broader ‘Telco 2.0’ lessons for other operators?

News Glorious News

News flow from Blyk has been positive recently. It announced a few weeks ago that it has reached 200,000 customers in its first year of trading (versus its target of 100,000). This follows press releases in June that the company is set to expand operations in 2009 into other European markets, notably the Netherlands, as well as Belgium, Germany and Spain. All this follows investment (of an undisclosed amount) from Goldman Sachs and IFIC in January. The current squeeze on credit can hardly be helpful to an expanding start-up, but it looks like Blyk was lucky in securing funds ahead of the summer problems.

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