Will Google (NSDQ: GOOG) and its push for open networks put more pressure on the struggling MVNO sector? Red Herring has a rather muddled story on how MVNO’s will fare in the face of more open networks.

Alex Besen, president of research firm the Besen Group argues that open networks will favor mass-market, cheap cell phones, which will put MVNO’s such as Helio under pressure. Helio offers slick handsets and high monthly tariffs that give subscribers a range of cutting edge content and applications, such as GPS services with Google Maps and 3G access to email. Since its launch in May 2006, the SK Telecom (NYSE: SKM) and Earthlink-backed MVNO has struggled to attract its targeted subscriber numbers. The “new, hardier” breed of MVNO’s poised to replace current ones could include community-focused operators who target ethnic groups, offering phones that can be used both in their home countries and the US. Ad-funded MVNO’s will also emerge and high-end handsets like the iPhone will also struggle in the new market focused on cheap goods.

But the Herring also quotes IBB Consulting partner Moe Tanabian who believes the mobile world will break into three groups, carriers that provide pipes, application providers and device providers--though doesn’t this exist already? Tanabian (and the author) don’t elaborate on if and how much these groups will overlap. He does believe that MVNO’s will need to move to non-voice applications to succeed--but isn’t that what Helio has been trying to do?

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