AirMedia runs the AirMedia Live Internet Broadcast Network, a one-way wireless push technology service running on hardware called the AirMedia Internet Antenna. The company will reportedly incorporate IFusion's Arrive software, which can be used to create push channels, into AirMedia's service. Last month, AirMedia cut a deal with Backweb Technologies to carry BackWeb'a content channels on its wireless network.
IFusion was one of the first push technology companies to appear on the market and gained notoriety by becoming the new industry's first casualty. The company filed for Chapter 11 bankruptcy in March 1997 and fired nearly all its 140-person work force. The company also closed certain national offices. IFusion currently runs on a skeleton crew out of offices in New York and Vienna, Virginia.
Months earlier, however, IFusion had been a darling of the high-tech promotional machine. Several publications, including CNET.COM, picked Arrive as one of the hot new products of Fall Comdex trade show in November 1996. Prudential Securities had invested $10 million into the company. Former employees also said that the company at one point discussed further financing from CNET investor Intel (INTC). The company had been planning a launch of its product in early May.
The downfall is attributable to mismanagement by spend-happy executives, said sources and other observers in the push industry. Several ex-employees have blamed Michael Recantati, the company's Ferrari-driving CEO and a major investor, for a lack of focus.
Kelsey Selander, marketing vice president for BackWeb, said at a panel discussion it was a lack of a clear business strategy that led to IFusion's downfall; namely, its attempt to be both a technology and a content provider.
IFusion remains in Chapter 11 bankruptcy, sources said, so the sale of the assets will be subject to review by the U.S. Bankruptcy Court. AirMedia will buy all of IFusion's assets, said sources. Arrive, however, is the most significant asset. When the deal is completed by the end of the month, AirMedia will shut down its Vienna, Virginia, offices, added sources at IFusion.
AirMedia and bankruptcy counsel for IFusion were contacted, but could not be reached.