The StartUp Beat: 4/2/07
-Trouble at Helio? – It seems that despite its best efforts, Los Angeles-based Helio can’t avoid serious questions about its future. This time, Scott Leith at the Atlanta Journal-Constitution writes that barring further significant investment from backers EarthLink and SK Telecom (or bringing in outside investors), the company “might not stay afloat.” Based on a filing last week with the SEC, Leith reported that the company does not have enough cash to operate through this year, based on losses of $191.8 million last year.
Helio is a mobile virtual network operator (MVNO), meaning that the company offers mobile phone service over other companies’ networks. The company’s value proposition is unique devices and services that it can offer on top of basic phone service. The market is notoriously hard to crack. For example, ESPN offered a sports-focused MVNO a few years back, but ultimately threw in the towel on the venture.
Amp’d Mobile is another local company going head-to-head with Helio for the MVNO market. Amp’d has slight advantage with the news cycle because it is privately funded so it can withhold subscriber and financial numbers, unlike Helio which is backed by two large public companies.
Despite the fact that it is bleeding cash, Helio may have as good a chance of success in this market as anyone. It has recently released a number of top-notch Helio-branded phones, and is run by a team of experienced executives, including EarthLink and Boingo Wireless founder Sky Dayton. In addition, the company has the backing of two huge consumer-focused companies. But the question remains whether it will be enough to compete with the likes of AT&T Wireless and Verizon. Here’s the article from the AJC: EarthLink’s cell venture running low on cash (reg req'd)
-Speaking of Amp’d Mobile… which has hit the market with a number of content deal announcements in recent weeks—if you’re curious, a review of its much vaunted Amp’d TV offering can be found at PC Magazine: Amp’d TV – Review by PC Magazine
-Miscellaneous - This has little to do with startups, but it’s interesting nonetheless for web surfers. A site called Pingdom has compiled a list of the total downtime to date this year for the top 20 web sites. Here is TechCrunch about the list: Top Twenty Sites: Most Downtime
