Why is it a turkey?
The MVNO launched by SK Telecom and Earthlink did not have a pretty year. In January, its founding CEO, Sky Dayton, resigned. [1] Then, at the end of February Helio reported that it had lost $327 million in 2007 [2].
In June, after talks between SK Telecom and Virgin Mobile USA seemed to stall, it was reported that Helio would be closing some retail locations and kiosks [3]. A few days later Virgin Mobile confirmed that it would acquire Helio [4] for $39 million. As part of the deal, the Virgin Group and SK Telecom agreed to invest $25 million each of equity capital in the post-merger Virgin Mobile USA. But the damage had been done. All but one of Helio's retail stores were closed [5] by mid-August. The deal was completed at the end of August. [6]
SK Telecom reported a 57 percent drop in third quarter profit [7] following the Helio sale, and noted a quarter-on-quarter loss because of the deal. Virgin Mobile USA gained from the deal though, and posted better-than-expected third quarter profits [8].
Links:
[1] http://www.fiercemobilecontent.com/story/sky-dayton-resigns-helio-ceo/2008-01-29
[2] http://www.fiercemobilecontent.com/story/helio-losses-grow-but-so-do-revenues/2008-02-29
[3] http://www.fiercemobilecontent.com/story/helio-planning-close-stores-kiosks/2008-06-23
[4] http://www.fiercemobilecontent.com/story/virgin-mobile-usa-confirms-helio-acquisition/2008-06-27
[5] http://www.fiercewireless.com/story/helio-closes-all-one-retail-store/2008-08-15
[6] http://www.fiercemobilecontent.com/story/virgin-mobile-usa-completes-helio-acquisition/2008-08-25
[7] http://www.fiercewireless.com/story/sk-telecoms-net-profit-drops-57-percent-wake-helio-deal/2008-10-29?utm_medium=rss&utm_source=rss&cmp-id=OTC-RSS-FW0
[8] http://www.fiercemobilecontent.com/story/virgin-mobile-usa-q3-earnings-beat-expectations/2008-11-11
[9] http://www.fiercewireless.com/special-reports/pivot-joint-venture
[10] http://www.fiercewireless.com/special-reports/theyre-cooked-wireless-turkeys-2008
[11] http://www.fiercewireless.com/special-reports/ultra-wideband