Earthlink Inc. earlier this week announced a companywide restructuring that will eliminate 900 jobs. Its mobile phone subsidiary, Helio, which it owns jointly with South Korean wireless provider SK Telecom, added to that number when it said this week it would cut 100 of its 700 employees.

A Helio spokesman on Friday said the layoffs included 80 sales jobs and 20 at company headquarters in Los Angeles. Borrowing a page from economists, who can spin numbers to reflect numerous truths, the spokesman said the cuts came about because the company is focusing its sales efforts on its fastest-growing markets. Fewer resources are necessary, he argued,  because Helio no longer has to devote much of its resources to building its brand after it launched in 2006.

OK, we’ll play along. The spokesman said Helio continues to meet its subscriber targets and that its August numbers will surpass July, which was the company's best month ever (though he would not provide subscriber numbers). He said Earthlink never expected Helio to be profitable right away and knew it would be a capital-intensive business.

On July 25, Earthlink and SK Telecom committed to providing Helio up to $100 million in additional funding, showing continued support of the venture. But with Earthlink looking for ways to improve its balance sheet and perhaps make itself more attractive as a takeout candidate, Helio remains vulnerable to being divested by its American parent. — David Shabelman

See Aug. 28 story in TheDeal.com

Tags: Earthlink, Helio, telecom