MobiTV withdraws IPO bid

MobiTV, a maker of apps that let users watch live TV on smart phones, has withdrawn its request for an initial public offering to raise up to $75 million.
In a letter sent to the Securities and Exchange Commission Friday, Emmeryville, Calif.-based MobiTV asked that the IPO bid it filed last August be withdrawn immediately based on “unfavorable market conditions.”
Unfavorable? Well, maybe …
As Bloomberg noted, the Standard & Poor 500 Index has gained 3.5 percent since the end of May, when Facebook floundered with its IPO. During this period, ServiceNow Inc. went public and has seen its stock price jump 34 percent since last month. Meanwhile, Palo Alto Networks Inc. and Kayak Software Corp. are proceeding with IPO plans next week.
Also read: MobiTV’s IPO filing is not a pretty picture
MobiTV has never been profitable — it reported an $11.8 million loss last year even though its revenue rose 27 percent to $85.1 million.
And not only must MobiTV compete for customer attention with online video companies like YouTube (s GOOG) and Netflix (s NFLX), and others like Aereo that are only emerging, its business model is beholden to large wireless carriers to which it partners with for distribution. In 2011, 97 percent of its revenue came from Sprint Nextel Corp., T-Mobile, AT&T and Verizon Wireless.
The company conceded at that time:

“If any one of these Tier 1 customers chose not to continue to use our services, or limited its use of our services, or if it replaced our services with a service provided by another company or by the customer itself, it would be difficult or impossible for us to replace that revenue because there are a limited number of such Tier 1 customers. Any such development would harm our business, operating results and financial condition.”