Bell takes over Virgin for $142 million, the end of Solo Mobile?

John Connors

May 7, 2009 7:14 am

bellimagenewlogoSeems like Virgin Mobile’s current promotion called “Screw You Recession” actually is actually working. Today Bell announced they will be taking over the remaining 50% stake in Virgin they didn’t own for they $142-million.

Bell and Virgin Group formed the Mobile Virtual Network Operator (MVNO) in 2004. Under the licensing agreement, Bell will retain long-term rights to the Virgin Mobile brand and the benefits associated with such a relationship with the Virgin Group.

This sale actually makes a bit of sense. Remember back in February when Virgin increased their rate plans by 17%, we informed you then that they have yet to break even since opening their doors. I guess as a brand, Virgin is string and can this be the end of Solo Mobile? Why would there be 2 low cost brands within one organization.

The Virgin brand will still have a presence and will not disappear. They will have distribution channel and will work with Bell to enhance “operational efficiencies from shared network infrastructure, handset acquisition and common distribution in high-traffic retail locations such as The Source.”

George Cope, President and CEO of Bell and BCE said “Bell Mobility’s acquisition of Virgin Mobile Canada supports our strategic imperative to Accelerate Wireless, a core component in Bell’s overall strategy to achieve our goal: To be recognized by customers as Canada’s leading communications company. This initiative will allow Bell Mobility to be uniquely flexible in the competitive wireless marketplace, maximizing network, handset, distribution and global roaming efficiencies, and enhancing the growth of the No. 1 youth brand in Canadian wireless.”

Sir Richard Branson, Chairman of The Virgin Group, said: “Bell has been an ideal partner for Virgin since 2004. I believe the acquisition of Virgin Mobile Canada and continuing licence of the Virgin Mobile brand to Bell will help to expand the Mobile business more quickly and allow even more Canadians to enjoy the unique wireless service and product experience Virgin created. We look forward to supporting Bell’s expansion through our ongoing efforts to build the Virgin brand in Canada with entertainment businesses such as Virgin Festival and Virgin Radio.”

More here at Bell

  • theninjasquad

    Maybe Bell can learn something from Virgins great customer service.

  • Ted Avery

    I find this to be some sad news :( It was Virgin and their brand that really cared about having high value for customers. They were the first to offer no system access fees and lead the way in affordable wireless for Canadians. It certainly wasn't Bell's doing, Solo was always considerably pricier than Virgin until just recently.

    Thank you, Virgin, for your contribution and competition in the Canadian wireless industry!

  • midtoad

    WTF? This cannot be good for consumers. Virgin apparently brought in lots of good ideas and some service features that were not present in Bell's Solo Mobile. Are we now going to have poorer plans and services from Bell?

  • the goro

    Well im not suprised by this at all. Virgin Mobile Canada had way to many issues that they just couldnt resolve. Thier Problems where from marketing to managment and business model.

    This happen alot faster then every one expected but i guess you can only bleed out money for so long.

  • mario83

    i dont know what will change in the long term, but i recently got a phone with virgin mobile. in the activation process i screwed up the programing the phone. so i called and i didn't wait long at all, and the CSR treated me good. granted i have limited experience with their customer service but so far im impressed with their service,