Adderton out at Amp’d

Amp’d Mobile founder and CEO Peter Adderton is no longer with the virtual operator, Amp’d confirmed today, leaving the door open for new leadership as the small youth-oriented mobile company navigates its way through Chapter 11 bankruptcy.

An Amp’d spokeswoman said that no interim CEO has been selected yet and the company’s senior management will continue to run the company for the time being. Amp’d Mobile President Bill Stone, a former Verizon Wireless and Vodafone executive, already oversees the day-to-day operations of the company. He’s backed up by Chief Operating Officer Sue Swenson, an industry veteran who served as COO of T-Mobile USA and president of Leap Wireless. Three of the MVNO’s senior vice presidents--including Seth Cummings, who heads up Amp’d Mobile’s content operations--have also been with Amp’d from the start, coming over with Adderton from Boost Mobile.

The spokeswoman said Amp’d had no comment on how soon a replacement for Adderton would be found or if a current Amp’d executive would be promoted on an interim basis, but she confirmed that Adderton was still on the Amp’d board.

Adderton brought his novel idea of a hip, young mobile carrier from his original company Boost Mobile, which launched prepaid MVNOs in Australia and over the Nextel network in the U.S. before it was acquired by Nextel and eventually Sprint. Starting from scratch, Adderton focused on a bigger-spending class of customer, targeting young adults as well as teens with the Amp’d service and focusing heavily on mobile media and data services.

Launched over the Verizon Wireless network, Amp’d sought to secure post-paid customers that spent considerable sums on data services such as music, streamed TV, downloaded videos, games and other applications. It succeeded at that goal in part, racking up industry-leading average revenue per subscriber amounts of more than $100 a month, of which $30 a month came from data services. It also pulled off several mobile firsts under Adderton’s leadership, including the first live-over-mobile broadcast of sporting events such as Ultimate Fighting Championship. It also produced original mobisodes, one of which—the cartoon political parody Lil Bush—was picked up by Comedy Central, making it the first video produced from the mobile deck to crossover to traditional media.

But as Amp’d grew close to the 200,000 subscriber mark it encountered problems. Amp’d Mobile’s official statement was that its back-end infrastructure couldn’t keep up with growing subscriber volumes, but court documents show that the problem was deeper. A majority of Amp’d customers were locked into 18-month post-paid contracts, many of which stopped paying their bills during their contract periods, according to Amp’d Mobile’s filing with U.S. Bankruptcy Court. Amp’d eventually calculated that 80,000 of its customers, according to the filing, were likely to default on their bills, about 40% of its customer base. Amp’d sought additional financing from its private investors but was turned down. Compounding the crisis, Verizon Wireless--which is now Amp’d Mobile’s largest creditor, owed $33 million--declared Amp’d in default of its wholesale agreement and demanded a $4.5 million in payment. Otherwise Verizon Wireless would shut off network access, effectively killing the Amp’d service.

“Faced with no other viable alternative, the [Amp’d Mobile] board of directors resolved to seek bankruptcy protection on an emergency basis on the evening of June 1, 2007,” Stone said in an affidavit filed with the court.