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Virgin Mobile USA In Merger Talks With Helio; Other Options Still Being Considered
By Rafat Ali
- Thu 08 May 2008 11:30 AM PST
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, 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.
Under one scenario that has been discussed, SK Telecom would buy out VMUSA and do a cash infusion; then Virgin Mobile would buy Helio in an all-stock transaction. Both of the MVNOs run on the Sprint (NYSE: S) network, so at least both run on the same network. But the merger of two won’t solve any problems of scale or distribution for either of them, but at least would give the bigger partner VMUSA a high powered post-paid plan, and better handsets and phone UI.
SKT, South Korea’s largest mobile operator, has been looking to expand its operations in U.S. Cyworld USA, SKT’s social networking subsidiary here, hasn’t done as well as it expected, and we know Helio’s troubles. Previous reports have also said that SKT was looking at buying the troubled operator SprintNextel, along with PE firm Providence Equity. Sprint rejected the $5 billion bid.
As for VMUSA, when we asked CEO Dan Schulman to comment on rumors, he told us this earlier in the week: “We don’t comment on any rumors out there, but we have said that we believe that there are opportunities for us in terms of non-organic growth, such as another MVNO, or capability set that we might be able to avail ourselves of...Certainly there are a lot of opportunities that we see, and we think some of them are intriguing for us, but it’s a matter of what makes the most sense.”
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Registration Open For EconAds Seminar: June 3rd NYC; Confirmed Speakers
By Rafat Ali
- Fri 09 May 2008 12:17 AM PST
Ticket sales are now open for our upcoming EconAds seminar on June 3rd in NYC. As we have done with our previous seminars, this will be a smaller, more intimate experience. The in-progress program is here.
The seminar will focus on key sectors in the online advertising market. We will look broadly at the marketplace to see what disruptions lie ahead and where the investors are focused and where VC and M&A activity is heating up. The program is specifically targeted towards leading media, advertising and investment executives and is designed to promote knowledge sharing and encourage networking.
Confirmed Speakers
Doug Anmuth Analyst, Lehman Brothers
Samir Arora, Co-founder, Chairman & CEO, Glam Media
Lynda Clarizio, President, Platform-A, AOL
Peter C. Horan: CEO, IAC (NSDQ: IACI) Media and Advertising
Lance Maerov, SVP, Corporate Development, WPP
Dave Morgan, Founder, Tacoda
Nancy Peretsman, EVP, Managing Director, Allen & Co
Mike Walrath, SVP, Yahoo (NSDQ: YHOO) Advertiser Marketplace Group; Former CEO, Right Media
Sponsors: Platinum: IAC. Gold: Wall Street Journal Digital Network. For underwriting the event, e-mail our business side at advertising AT contentnext.com.
Thanks to Digital Hollywood for helping us co-locate our event there along with the bigger Advertising 2.0 conference on June 4th and 5th. This is part of the Internet Week.
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BBC Admits To Premium Rate Phone-In Problems; Pays £123,000 To Charity
By Dianne See Morrison
- Fri 09 May 2008 11:59 AM PST
The UK’s premium rate phone-in scandal rumbles on. The BBC admitted today that £106,000 raised for charity through a premium rate fundraising phone-in was in fact kept by Audiocall, a subsidiary of the corporation’s commercial division. The broadcaster said it would pay the sum plus interest--£123,000 to the charity Children In Need and that it would be disciplining staff involved in the mishap.
An independent review by Pricewaterhouse Coopers found that Audiocall, which runs the vast majority of the broadcaster’s fundraising phone-ins, had kept viewer money that had rolled in after the phone lines had been closed. It also found that “communication problems” during the show Eurovision: Making Your Mind Up 2007, which determined the UK’s entry into the Europe-wide music contest, meant that viewers had called in before the phone lines were open for voting. Not only did their votes not count, but the £6,000 that they paid in premium phone rates was kept by Audiocall. The BBC has since handed it over to charity. Some two dozen other shows had been affected between October 2005 and September 2007, although the BBC has refused to name them. BBC Trust chairman Sir Michael Lyons also ordered the broadcaster to make an on-screen apology.
The news comes just one day after regulator Ofcom fined ITV (LSE: ITV) a record 5.7 million pounds for fixing the results of polls and contests in which viewers were charged premium rates when they called in their votes.
BBC Statement | PWC Report | Ron Neil Report to the BBC Trust
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