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Virgin Mobile USA In Merger Talks With Helio; Other Options Still Being Considered

imageFrom our sister site MocoNews: Virgin Mobile USA (NYSE: VM), the MVNO which just reported its Q1 earnings earlier this week, is in talks with the much smaller and troubled MVNO Helio, we have learned, even as other PE and strategic players are still circling both the companies. Helio is now controlled by SK Telecom (NYSE: SKM), after Earthlink (NSDQ: ELNK) stopped making further investments, and has been looking at options to either exit or grow. For VMUSA, as we have mentioned before, some PE players have been looking at investing in the company or buying it outright, and even if the VMUSA-Helio deal comes through, the two could use some extra cash…more details on our site MocoNews.

May 8, 2008 1:35 PM ET

Posted In: Mobile, Money, M&A & Venture Capital, Mergers & Acquisitions

Comments (0)

May 8, 2008 7:04 PM

Is this the end of Helio…. Looking more like Ampd every day

Kevin

May 8, 2008 10:16 PM

Amp’d never merged with another MVNO.

Tom

May 8, 2008 10:44 PM

And thats why they went bye-bye.

Ruh

May 8, 2008 11:03 PM

Yeah Amp’d never merged but they did try to convice Verizon to buy em out before the bankruptcy. Amp’d was 100% omptimistic even after the bankruptcy and even the day before the bankruptcy. I was part of the cellairis project for Amp’d Mobile to help open 300+ stores for Amp’d Mobile and even the day before they knew they were filing bankruptcy we told them we were going to push for another 30 stores to be open in that June month that they filed. How messed up is that to not even tell you that they are filing and have to read about it. Same thing with Helio. Sk finally realizes that they are just fishing money away everday Helio keeps its doors open and why do you think Virgin wants to sell its Virgin Mobile because they realize the same thing, So Virgin is going to buy controlling stakes of Helio Stock after the merger, wow what a financial relief that is for Sk telecom. Nothing but trouble for the future, and the sad thing about this is is that I am a Helio dealer.

Kevin

May 9, 2008 7:45 AM

I have been following Helio, ever since the idea was conceived and am not surprised at its current state. I was a professor in Korea those days and tried my hard to give SK Telecom some sense on why convergence does’nt work. SK Telecom has had some success with mobile data on their on home turf and wanted to replicate that in the US. Unfortunately MVNO is a different story and the US is not their own home turf. NTT DoCoMo has also experienced that - i-mode has not succeeded in other countries anywhere close to what it did in Japan. Infact the success of i-mode in Japan is more of a perceived one - Tens of thousands of i-mode sites including mobile mail contribute only 25% to ARPU, the rest being contributed by voice.

I don’t foresee Helio succeeding in the current form in the US. What SK Telecom must realize is

1. Mobile downloads from Internet is a very small business in countries that have appreciable fixed broadband penetration
2. The use of convergence at the application level is not ingrained in the human psyche. It might change over thousand years
3. Human subconscience drives adoption and its understanding is critical to the marketing success of high technology services

In my most recent research I have studied the adoption dynamics of high technology services and have used the conscienc-subconscience model to explain the varying patterns. I have also used this study to design successful “go to market” strategies for mobile data services and Mobile TV.

I would be happy to share the outcomes of my study with the readers and can be contacted on .(JavaScript must be enabled to view this email address)

Mike Gauba

May 9, 2008 3:17 PM

I agree competely with Mike.  SK Telecom needs to wake up, stop wasting money, and better understand the US market.  MVNOs are not what will work.  There are too many disadvantages in the states with that structure. 

The best option I think for SK Telecom is to buy a smaller US entity who owns infrastructure and licenses such as Leap Wireless.  That would be killer.

keith

May 9, 2008 5:13 PM

i work for helio and havent heard anything about a merger. i hope not. i love helio.

brad

May 11, 2008 12:21 AM

Helio is so gay I had it 4 a wile and I left it with in like 3 to 4 months the service was was I droped calles all the time

zack

May 11, 2008 9:37 AM

Helio had better wake up and realize that they are losing so many customers because of their inept billing and customer service (which has gone from really bad to horrific since moving their call centers overseas). The Ocean was a nice little device, but other than that, I have nothing positive to say about Helio.

Sherri

May 12, 2008 4:46 AM

Time WILL tell. Let’s keep our ears open to the RIGHT channels.

Adam

Jun 22, 2008 2:56 AM

i’ve had helio for 2 years now, started with the kickflip, which i loved. now on the ocean, in the past year since i’ve had it all i’ve noticed is disappointment.

first, the lady over the phone said “FOR ANY REASON YOU ARENT SATISFIED, RETURN THE PHONE WITHIN 30 DAYS”

and i said “even if i don’t like the phone cuz it’s ugly?”

and she said “total happiness guarantee, so even if it’s ugly, return it for a full refund”

went through that hassle after trying to return it for a week speaking to 3 different managers, only to be told no.  now within the last month, i’ve received about 20 dropped calls, that’s 20 more than i’ve ever gotten with helio.

at this point, i’m basically gonna call it quits on helio since it seems like it’s calling it quits on us. 1

manny

Aug 16, 2008 9:59 AM

End of Helio…

Hidden object

Aug 26, 2008 12:53 PM

Its true!

Play games

Sep 5, 2008 10:49 AM

Bye-Bye Helio.  You won’t me missed.

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Sep 15, 2008 5:58 PM

I can’t agree more with the above posters. Helio is one of the worst mobile providers ever. After some long back and forth dealings with their managers, I’ve decided to call it quits and switched to AT&T;, and I’ve been quite happy with it so far.

earth4energy

Oct 4, 2008 2:55 AM

Haha cya helio!

Earth 4Energy

Oct 13, 2008 2:29 PM

Mergers are always good. Better service in the end.

Francis

Oct 15, 2008 12:06 PM

Remember having a really rough time with helio. Glad to see improvements

lcd

Nov 8, 2008 4:22 PM

I can only agree with the above said. I had bad experience with the company. This is good news.

TheKey

Jan 31, 2009 6:09 AM

I totally agree with you guys! Helio is the worst mobile provider i ever worked with. I switched to Verizon a while ago!

Earth4Energy

Feb 28, 2009 1:26 PM

Helio had better wake up and realize that they are losing so many customers because of their inept billing and customer service (which has gone from really bad to horrific since moving their call centers overseas). The Ocean was a nice little device, but other than that, I have nothing positive to say about Helio.

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Mar 8, 2009 1:19 AM

I am based in UK and using Virgin Mobile for past 5 years. I am really happy with their customer service. I think merger with Helio is really good option for inorganic growth.

Earth 4 Energy Comments

Mar 12, 2009 6:25 AM

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jetlite

Mar 26, 2009 3:46 PM

I’m also a Virgin Mobile subscriber and I agree that their customer service would greatly improve Helio’s offering.

Earth4Energy

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