Helio readies the Ocean 2 smartphone

Helio, the "virtual" wireless operator that was bought by Virgin Mobile USA last year, is about to launch the next rendition of its flagship smartphone called the Ocean 2, Silicon Alley Insider reported Friday.

The Web site cited a company representative who said that the new phone could go on sale as early as next month.

Several blogs mentioned the existence of the new phone back in May. At the time, Engadget reported the device

would have a 3-megapixel camera, a dual-slider design like the first Ocean, 1GB internal storage, Flash support in the browser, 30fps video recording, a touch-sensitive pad, a microSD card slot, plus PC sync capability.

Fast forward seven months, and the phone still hasn't launched. What's the hold up? It's likely that Virgin Mobile's $39 billion acquisition of Helio last June delayed things a bit. And now that the company has been rebranded to Helio by Virgin Mobile

it is ready to launch the new smartphone.

But the big question is whether the Ocean 2 will be able to compete against other hot smartphones on the market, including Apple's iPhone 3G, Google's Android phone from T-Mobile called the G1, Research in Motion's BlackBerry Storm and Bold devices and Palm's new Pre.

All these hot new phones have been introduced in the past six months, after rumors of the Ocean 2 were first reported.

Helio's original Ocean was introduced in 2007, a few months before the iPhone. While the phone has some solid features, it's no iPhone. And my gut feeling is the newer version will still have a tough time competing with the iPhone and all the other hot smartphones on the market.