Drinking from the MVNO Money Keg (MOT, LU, NOK, NT)

Om Malik and Ian Gilliot have written extensively on the Mobile Virtual Network Operator (MVNO) phenomenon, some of them raising upwards of $300m to build specialty services that ride on existing mobile operator networks. Both Om and Ian suggest that MVNOs like Amp’D, Helio, XeroMobile, and Mobile ESPN are likely to follow the same boom-bust dynamic of CLECs of five years ago. I agree. History is likely to repeat itself.

In fact, a new mania is upon the land as evidenced by the facts surrounding those involved in the most recent wild horse, XeroMobile. The Register, FT, and others have reported on the strange nature of some of the principals, many of whom recently jumped from a failed effort using the same business model. Apparently, the past doesn’t seem to matter to a substantial number of investors.

That being the case, there will be winners and losers — just like the last time. As Om Malik and others point out, the losers will be “private equity investors, venture capitalists, and well in the end the citizens who fund pension funds.