Virgin Mobile Telecoms Ltd., the cellular telephone unit of Richard Branson's Virgin Group, is in talks with Sprint Communications Co. LP regarding the creation of a joint venture that could herald its long-awaited entry into the U.S. mobile communications market, according to a report on the Web site of The New York Times.
The newspaper, quoting people close to the discussions, said Virgin has talked with a number of carriers including Nextel Communications Inc. and AT&T Wireless Group Inc. although discussions with Sprint have progressed the furthest. The sources cautioned that a deal was not imminent and that the discussions could still fall through, said the report.
The deal, if it is signed, will be similar to that with One2One PLC in the U.K. There, services with the Virgin Mobile brand are delivered over One2One's network. One2One is owned by Deutsche Telekom AG.
Virgin has been eyeing entry into the U.S. cellular market for some time, and began searching for potential partners last year. At the time it had hoped to sign a deal before the end of the year although the company has yet to find a partner. Its entry into the market would represent a big step forward for the company in its international expansion plans. The U.S. is currently the world's largest cellular phone market with 104.5 million subscribers at the end of 2000, according to estimates from the Strategis Group.
In November of last year Virgin formed a Singapore-based joint venture with Singapore Telecommunications Ltd.'s SingTel Mobile unit to expand the Virgin service into Singapore, Hong Kong and Taiwan through Virgin Mobile (Asia) Pte. Ltd., in which each company holds a 50 percent stake. Additionally, Virgin launched service in Australia in October 2000 through a joint venture with Cable & Wireless Optus Ltd.
Richard Branson, high profile founder of the Virgin Group, plans to launch mobile phone services in Japan too, possibly early next year, he told the Nihon Keizai Shimbun newspaper in an interview during a visit to Japan two weeks ago to launch an improved business-class service on his airline.