Virgin Mobile IPO fails to pop

Some IPOs — like Google and VMWare—are impressive from the start. Others — like Vonage, which has fallen 85 percent since going public — fall flat. Virgin Mobile, with its cherry brand name and backers, should have had a sparkling debut. And yet it didn't.

Virgin Mobile, unlike the big carriers, rents a wireless network rather than owning one, essentially gussying up and reselling Sprint's service under its own name. It's a challenging business model, known in the trade as being a "mobile virtual network operator" or "MVNO." Disney and Amp'd, among others, have failed to make a go of it.

Renting one's network means lower capital costs, and according to the Wall Street Journal, Virgin has 4.83 million subscribers and actually made a small profit this year. Virgin Mobile has plenty of revenue, but with a flat IPO today and loads of debt, it is unclear if it can make itself into a viable company.

Disney Mobile shut down last month and Amp'd burned through hundreds of millions of dollars with nothing to show for it. History does not look good for Virgin, but with strong name recognition among their target market and clever advertising, we don't put it past Sir Richard to succeed where others have failed.

(Photo by AP/Jacques Brinon)