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Virgin-Helio: Execs Explain Tie-Up; Confirms Helio Store Closures And Other Reductions

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Will the Helio name be dropped? Did you have to give up anything to Sprint?:On the branding piece, we intend that Virgin Mobile will be the brand going forward, we may continue to use the Helio brand in the Korean markets. What we are giving Sprint is more volume. The combined company together is a more substantial company with bigger volumes to come, Sprint was willing to give us network rate reductions and $10 million bonus as well.

MVNOs haven't fared well, is there are one or two points, why the combo of Helio and Virgin will succeed?:We have very consistently said from the beginning building the wireless business is hard to do. In 2002-2003, we may have made it seem too easy and a lot of people jumped into it. The key to success is scale. It wasn't until we got up to the 3-4 million range of customers, did we know we would have a successful business going forward. It's like adding 700,000 prepaid customers. It improves our network costs, which is one of our largest. Over the next 18 months, it will improve by about $40 million. We have a much stronger capital structure to support the growth going forward. You can't lump MVNOs together with all MVNOs, this is all about how to get to scale. Each were unique, but at the end of the day, you can't be successful without scale.

Will you have access to Sprint's WiMax network?It does, but we aren't talking about the provisions around wholesale agreement. Right now we are concentrating on 1x and EV-DO networks. Through this platform, we'll be able to offer a Helio "light" offer that may not want to upgrade the faster handsets.

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