Helio: Shifting Gears?

Posted by: Olga Kharif on November 15, 2007

It appears that Helio, the money-losing wireless service started by SK Telecom and EarthLink, is changing its market tactics.

After targeting the high-end of the wireless market for 1-1/2 years, and gaining 130,000 customers by August, Helio may be slowly inching down its prices. This holiday season, it’s offering a $50 discount on all of its handsets. And its wireless plan prices appear to have gone down: The cheapest family plan can be had for $60. An unlimited voice and data plan sells for $99 with a two-year contract, which is almost on par with mainstream wireless carriers’ offerings.

Frankly, this was to be expected. While, when Helio launched in 2006, many of its multimedia data services — video clips, mobile social networking features — were a rarity, they are that no more. Nowadays, AT&T and Verizon Wireless offer tons of compelling mobile content and applications. And while Helio may still attempt to differentiate through its exclusive handsets, it can’t beat AT&T’s exclusive iPhone.

All that means that Helio, which lost more than $93 million in the third quarter alone, can no longer justify higher prices.

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BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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