Monthly Archives: July 2008

Virgin Mobile Buys Helio Out of Petty Cash

Helio’s demise does not come as a shock, but that price! [Engadget]( “Two years and half billion later, Helio sells for a song. But why? – Engadget”) says it best:

> We know Helio was burning cash like crazy, but that doesn’t entirely explain why SK Telecom was so absurdly desperate to dump their $500m investment. At a $39m acquisition price, SK didn’t just lose its shirt — it lost that, the shoes, and then the pants. You know, the pants with a half-billion dollars in them.

The [MVNO]( “Mobile Virtual Network Operator”) model seems to be a great idea. Mobile phone users should not care who owns the towers and runs the network. They should care about the phones, the software and the customer service. It makes sense. Let the network details be a [B2B]( “Business-to-Business”) transaction. I really don’t care who my ISP is as long as my Internet service can keep up with my daily [Hot Chicks with Douchebags]( “Hot Chicks with Douchebags”) addiction.

I’m not a marketer, and I don’t know what it will take for the MVNO’s to convince consumers that retail mobile phone service from someone other than the telco is better. I don’t even know that consumers understand that Virgin Mobile is really just a marketing and customer service organization. When looking for mobile phone service, I suspect that most people look for the biggest (aka most reliable) provider. After all, we all hate dropped calls. If any provider can make the MVNO model work, it’s the original one, [Virgin Mobile]( “Virgin Mobile”). Few are better at branding and providing an experience that people want than [Richard Branson]( “Richard Branson”) and [Company]( “Virgin Group”).

I wish Apple would get into the MVNO game. It has already taken the carrier out of the software and phone business. Now, all we need is for Apple to start selling the phone service. A world where I could deal with Apple’s user experience and customer service instead of AT&T’s is a world I would gladly pay a little extra to live in. Who knows, AT&T might get better. [It had the sense to get the heck out of San Antonio](

*(via [Engadget]( “Two years and half billion later, Helio sells for a song. But why? – Engadget”))*

Get Out of Dodge (or San Antonio)!

In an only slightly surprising move, [AT&T announced]( “AT&T moving headquarters to Dallas from San Antonio”) this week that it is moving its corporate headquarters from San Antonio to Dallas. I’m surprised that it took so long.

While I’m sure that there are numerous reasons for the company’s departure, its primary excuse is air travel. I know, from personal experience, that non-stop flights from San Antonio to any major city outside of Houston and Dallas are as rare as a south Texas winter snowstorm. Trying to fly out of San Antonio on a regular basis is an exercise in patience and frustration (and lots of connecting flights). As airlines cut schedules and ground aircraft, this problem will only get worse. Still, I doubt that air travel is the *primary* reason for AT&T’s exodus. I share [Stacey Higginbotham’s skepticism]( “Blaming Airlines, AT&T Takes Flight – GigaOM”):

> Perhaps the lack of good flights is a scapegoat to help Randall Stephenson avoid insulting San Antonio’s technology credentials. Although after a decade and a half in the city, the fact that few technology related startups grew up around one of the top 25 companies in the U.S., is a damning testament to the city and the company itself.

That a sea of tech startups have failed to materialize in the home of AT&T and Rackspace exposes a reality of life in San Antonio: it’s boring. For a city of its size, San Antonio has a remarkably small town feel, and most people are comfortable and content with their lives and surroundings. While admirable, this contentment is a vise that relentlessly squeezes the entrepreneurial and creative spirit from the city. There is nothing wrong with San Antonio being boring. Many people would love to live in a place where they are comfortable and content, but a boring city will not encourage creative and daring entrepreneurism, and a boring city will not attract young, creative talent. I suspect that San Antonians are content with that as well.

Even so, AT&T is not moving to Dallas because it is less boring than San Antonio, or because it is a more entrepreneurial city, or even to make air travel a little easier for its executives. Dallas is bursting with telecom companies and employees, and it makes much more sense for the nation’s largest telecom company to be headquartered there. I doubt that there is little more to it than that.

*(via [GigaOM]( “Blaming Airlines, AT&T Takes Flight”))*