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Daily Report: Sean Parker\'s Start-up Struggles

It takes more than two famed entrepreneurs, tens of millions of dollars in the bank, enormous publicity and endorsements from celebrities like Alicia Keys and Jim Carrey to get a start-up going, reports Jenna Wortham of The New York Times.

Airtime, the much-hyped video chat site created by Sean Parker and Shawn Fanning, the two behind the music sharing service Napster, has turned out to be far from a sure thing.(Mr. Parker also helped Facebook in its early days.)

The site is just four months old, and the staff is tweaking its features to make it more appealing. So far, though, Airtime's traffic appears to be little more than a trickle.

And the latest bits of news about the company - it has lost some important employees and laid off others - do not bode well for its future.

Airtime's still-unfolding story reflects the challenges for any start-up, regardless of pedigree, in winning over users when so many other sites, apps and services are vying for t heir attention. And it shows how hard it can be to spin viral magic out of thin air.

Mr. Parker rejected the idea that Airtime was struggling. He said there was a dedicated core of people who used it regularly, and he pointed out that the company was still getting its bearings.

“This is a ridiculously early stage for a company,” Mr. Parker said in an interview on Monday at his town house in New York. “It takes six to 12 months to get things up and running.”

Some of the criticism lobbed at the company came in response to its over-the-top introduction - a star-studded event at a studio in Manhattan. Mr. Parker said he wanted to grab the attention of those who were not avid technology users and reel in a big group of the curious on the first day. The lingering scrutiny of the company was an “unintended consequence,” he said.

Airtime declined to give specifics about its user numbers other than to say that early traffic was “very compelling. ” AppData, a service that collects data about sites and services that connect with Facebook, indicated that Airtime had just 400 users a day and 10,000 over the course of a month, but Mr. Parker and other executives at the company suggested those figures were off. Nielsen and comScore, two independent analytics firms, both said that traffic to Airtime was so small that it did not yet register on their charts.