Vitaminic Throws in the Towel

Mark Mulligan | February 05, 2003, 10:40 AM

Vitaminic has paid the price for dwindling revenues and a market that has just failed to materialise, announcing that it will merge with fellow Italians Buongiorno.
Only 2 years ago they were aggressively expanding throughout Europe, with regional offices in 7 countries and a buoyant share price on the Neuvo Mercado enabled them to buy up much of the competition. The purchase of UK based Peoplesound was something of a masterstroke and the resultant B2B revenues will have gone a lomg way to sustaining Vitaminic in the subsequent months.
But inspite of all this, Vitaminic missed out one minor detail - no core business. Their failure to secure content from the majors left them reliant on advertising, which soon enough disappeared.
Vitaminic were sharp enough to see the writing on the wall many months ago and created diverse business chanels accordingly, with a particular focus on wireless - which is where the new company looks set to focus its future efforts.
However, the decline continued and in the last few months Vitaminic have been scaling back, pulling out of many markets, so that by the time the deal was struck with Boungiorno, Italy accounted for 85% of business, rather than 20%.
Ultimately, Vitaminic paid the price of the major labels' reluctance to do business with them.