Virgin Mobile Buys Helio, Moves Into MVNO

Looks to succeed where all others have failed.

It’s probably a surprise to our US readers that MVNO (mobile virtual network operator) Helio has been snapped up at Death’s Door by Virgin Mobile, but we in the UK perhaps know better…

Paying out just $39m in stock options Virgin now becomes the last major MVNO in the US in the process safeguarding all Helio’s 170,000 customers (and new subscribers) while trying to replicate its successful UK strategy.

For the uninitiated, MNVO’s are operators without their own licensed airwaves who instead buy minutes at wholesale prices from other operators then sell them onto customers in tariff plans. The system has worked well in the UK where Virgin has more than 4m customers but – as Robbie Williams, Oasis, the Spice Girls and many more failed imports will tell you – the US is a tough nut to crack.

As far as the nitty gritty goes the Helio brand (which has seen more than $500m invested in it since launch) will eventually be phased out as the ‘Virgin Mobile USA’ name takes over. The duo claim “big ideas” will result from their combined force (higher-end handsets are a must) but – to coin an appropriate phrase – it will have to win over the hearts and minds of a great deal of American sceptics.

Good luck guys, you’ll need it…

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