Virgin Mobile USA

Virgin Mobile USA completes Helio acquisition

Jason Ankeny — Mon, 25 Aug 2008 09:46:56 -0400

Virgin Mobile USA said its acquisition of rival MVNO Helio is now complete, with Helio shareholders SK Telecom and EarthLink receiving limited partnership units and shares equivalent to 13 million shares of Virgin Mobile USA common stock valued at $38 million based on the average closing price as of two trading days before and two trading days after the deal's June 27 announcement. In addition, SK Telecom and Virgin Group will each invest $25 million in Virgin Mobile USA for preferred shares. Beyond adding Helio's differentiated postpaid offer to the Virgin Mobile USA portfolio, the deal also heralds revised rates from network operator partner Sprint resulting in an 8 percent cost-per-minute reduction, roughly 17,000 Helio subscribers and a reduction in net debt totaling between $35 million and $40 million.

For more on the Virgin Mobile USA/Helio agreement:
- read this release

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Virgin Mobile USA profits fall 50 percent in Q2

Jason Ankeny — Thu, 14 Aug 2008 10:15:17 -0400

Virgin Mobile USA Inc. announced its second-quarter profit plummeted as revenue declined and net subscriber losses exceeded the 100,000 mark. Virgin Mobile earned $3.5 million in Q2, down 50 percent from $7.1 million in the year-ago quarter--revenue fell 3 percent to $317.4 million from $327.6 million, and the operator lost 111,273 net customers, up from losses of 53,424 a year earlier. Virgin Mobile USA now boasts 4.99 million customers, up 3.4 percent from 4.83 million a year ago.

Average revenue per user for the second quarter declined 7.9 percent year-over-year to $19.32--ARPU for the first six months of 2008 was $19.63, off 9.5 percent against the first half of 2007. Virgin Mobile blamed the decline on lower customer usage of its traditional prepaid plans as well as an industry-wide trend substituting lower-cost messaging for voice. The operator forecasts ARPU trends will improve during the second half of the year thanks to a shift to higher-value hybrid customers as well as increased penetration of new voice and messaging services.

For more on Virgin Mobile USA's Q2 results:
- read this release

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Virgin Mobile USA launches Ringback Playlist

Jason Ankeny — Wed, 06 Aug 2008 09:39:57 -0400

Mobile managed personalization services provider LiveWire Mobile announced an agreement with Virgin Mobile USA to launch the Ringback Playlist, which enables subscribers to access pre-selected content channels instead of settling for an individual ringback tone. After Ringback Playlist subscribers choose their favorite music genre or artist, callers will hear different tones from within the selected category--Virgin Mobile USA customers may also exploit personalization options that set specific tones according to the caller, the day of the week or the time of day. At launch, Virgin Mobile USA will offer 12 different Ringback Playlist channels spanning pop, hip-hop, alternative rock, country and TV/movie classics--each channel features five ringback selections. LiveWire Mobile's Achieve Marketing Team will regularly update track selections within the Ringback Playlist and provide specialized campaign support based on consumer metrics. Virgin Mobile will offer the service for $3.49/month, with an additional $1.49 monthly ringback subscription fee.

For more on the Ringback Playlist:
- read this release

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Virgin Mobile USA confirms Helio acquisition

Virgin Mobile USA confirms Helio acquisition

Jason Ankeny — Fri, 27 Jun 2008 10:05:52 -0400

Virgin Mobile USA officially confirmed it will acquire rival MVNO Helio from SK Telecom and EarthLink. Per terms of the deal, SK and EarthLink will receive limited partnership units equivalent to 13 million shares of Virgin Mobile USA class A common stock, valued at $39 million based on June 26 closing prices. The transaction is expected to close in the third quarter. Parent firm Virgin Group and SK Telecom will also invest $25 million each of equity capital in the post-merger Virgin Mobile USA--through its holding of limited partnership units and preferred stock, SK Telecom will own approximately 17 percent of Virgin Mobile USA, and will take two seats on the company's board of directors.

The deal enables Virgin Mobile USA to transition into the postpaid subscriber market-- last month, the MVNO reported first quarter net income of $4.8 million, down 75 percent year-over-year, and announced anticipated Q2 subscriber losses between 130,000 and 160,000. According to Virgin, roughly 20 percent of those lost subscribers move on to postpaid operators. Helio reported in January subscriber totals approaching the 200,000 mark, with ARPU of roughly $80. The acquisition also allows Virgin to add a suite of new data applications and services, including partnerships with YouTube, Google and MySpace.

Virgin Mobile USA will also revise its network capacity agreement with Sprint Nextel, and said it expects to achieve a minimum of an 8 percent reduction in its effective cost per minute in 2009, with further reductions over the next three years. The new deal means Virgin Mobile USA's cost per minute is now tied directly to the volume of network traffic it generates, and will no longer be dependent on Sprint's network costs. According to Virgin, the new volume discount structure allows additional flexibility in pricing--moreover, effective July 1, Sprint will provide a $2.50 network usage credit to Virgin for each gross customer addition, with a cap at $10 million.

Some may suggest Helio's demise heralds the official end of the MVNO era. But as long as P Diddy lives, MVNOs will never die.

For more on the Virgin/Helio deal:
- read this release

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Virgin Mobile USA poised to acquire Helio

Jason Ankeny — Wed, 25 Jun 2008 07:52:27 -0400

Virgin Mobile USA will acquire embattled MVNO Helio, according to a report in The Financial Times. Citing sources with inside knowledge of the negotiations, The FT says Virgin Mobile and Helio majority owner SK Telecom have agreed in principle to a deal that will see Helio's operations and subscribers absorbed into the Virgin Mobile USA brand--in exchange, Virgin will issue new shares giving SK Telecom roughly 20 percent equity in the combined business. SK will also invest a nominal sum in Virgin Mobile USA.

The Financial Times notes that the post-merger Virgin Mobile USA will now be able to expand into the monthly contracts markets and renegotiate its network capacity agreement with Sprint Nextel. Last month, the MVNO reported first quarter net income of $4.8 million, down 75 percent year-over-year--in addition, the company announced anticipated Q2 subscriber losses between 130,000 and 160,000. Helio reported in January subscriber totals approaching the 200,000 mark.

Earlier this week, Gizmodo reported that SK Telecom and Virgin Mobile USA's merger negotiations were stalled, with Virgin's continued interest in Helio hinging on either a bankruptcy declaration or massive liquidation. The article also said Helio was poised to begin closing its retail locations and kiosks.

For more on the Virgin Mobile USA/Helio deal:
- read this Financial Times article

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Helio planning to close stores, kiosks

Jason Ankeny — Mon, 23 Jun 2008 10:58:40 -0400

Goodbye, Helio: Gizmodo is reporting the embattled MVNO is on life support after merger negotiations between parent firm SK Telecom and Virgin Mobile USA stalled. According to reports, Virgin's continued interest hinges on either a bankruptcy declaration or massive liquidation--in the meantime, Helio is planning to begin closing its retail locations and kiosks. Even if an official merger fails, reports suggest that remaining Helio subscribers will be migrated to the Virgin Mobile network.

For more on the Helio rumors:
- read this Gizmodo article

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Obama wins Virgin Mobile USA text poll

Jason Ankeny — Fri, 06 Jun 2008 09:00:12 -0400

Barack Obama is the clear favorite to become America's next president according to a new SMS-based mobile survey conducted by Virgin Mobile USA. According to the text poll, conducted in late May, 40 percent of the 20,000 Virgin Mobile USA subscribers queried favor Obama, with fellow Democratic contender Hillary Rodham Clinton garnering 18 percent of votes and presumptive Republic nominee John McCain trailing with just five percent. Fewer than five percent remain undecided. Virgin Mobile USA notes that over half of the respondents are females under the age of 25, and all participants earned five free minutes of airtime for voicing their opinions.

Given poor voter turnout in recent U.S. elections, it's worth noting that 57 percent of the Virgin Mobile poll respondents said they would be willing to vote for their next president via mobile device, with 55 percent claiming they would be more likely to participate in the election process if a text voting option became available. About 46 percent of respondents added they would be open to receiving text messages from their candidate or party of choice.

For more on the Virgin Mobile USA text poll:
- read this release

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Virgin Mobile USA inks ad deal with Platform-A

Wed, 21 May 2008 06:59:58 -0400

Web services giant AOL announced its Platform-A advertising unit will serve as the exclusive display advertising and sales partner for MVNO Virgin Mobile USA's WAP banner inventory. Per terms of the agreement, Platform-A's sales force will leverage the resources of the AOL-owned Third Screen Media mobile ad serving platform and network to manage Virgin banner ads, promising brands an opportunity to reach the operator's core 14-to-34-year-old subscriber demographic.

For more on the Virgin Mobile USA/Platform-A deal:
- read this release

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Virgin extends Sugar Mama to Facebook

Thu, 15 May 2008 06:59:59 -0400

Virgin Mobile USA announced the Fund My Phone application, which extends the operator's Sugar Mama marketing program to the Facebook social networking platform and enables consumers to earn wireless airtime for their fellow Virgin Mobile subscribers. Over 700,000 Virgin Mobile USA customers have joined the Sugar Mama initiative since its 2006 launch, viewing ad spots, responding to branded text messages and completing surveys to earn free airtime; with Fund My Phone, consumers download the app to their Facebook profile page and share up to five different spots with Facebook friends, scoring free minutes as the ads are viewed.

For more on Fund My Phone:
- read this release

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Virgin Mobile USA teams with Limbo

Wed, 09 Apr 2008 06:59:57 -0400

Mobile entertainment community Limbo announced a year-long deal with Virgin Mobile USA to provide exclusive interactive programs promoted via SMS blasts and the VirginXL platform. Virgin subscribers may now enter monthly interactive campaigns like Limbo Grab or Limbo Unique for a chance to win prizes like $1,000 cash, a 42-inch LCD TV or a 2008 convertible Mustang. "Limbo's interactive content is producing tangible business results for Virgin Mobile USA, increasing SMS usage among participating customers," said Virgin Mobile USA chief marketing officer Bob Stohrer in a prepared statement. "Participants indicate an increase in brand affinity and the viral spread is powerful, with over 70 percent of participants telling at least one friend about the promotion."

For more on the Virgin Mobile USA/Limbo deal:
- read this release

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