Sprint — the ailing U.S. mobile carrier — may just have been thrown a lifeline. Japan’s third-biggest mobile operator, Softbank, announced on Monday that it plans to acquire a 70% stake in the firm for $20 billion — the largest-ever overseas acquisition by a Japanese company, according to The Wall Street Journal.

The benefit for Sprint is clear: an immediate cash infusion. “Sprint has been struggling for years, and this deal should help them accelerate their network infrastructure plans to better compete with AT&T and Verizon,” says Michael Sinkinson, a professor of business economics and public policy at Wharton. The deal will also help Sprint maintain its lead over T-Mobile, which it has been battling for third place in the U.S. market (behind Verizon and AT&T), he notes. “However, any turnaround is likely still years away, as both infrastructure improvement and consumer acquisition are slow processes.”

But what’s in it for Softbank? According to Wharton emeritus professor of management Lawrence Hrebiniak, “The obvious benefits include entry into the large U.S. market and an ability to compete more forcefully as one of the largest telecommunications companies in the world, with 90 million subscribers…. This seems like a good move in an increasingly concentrated industry, and the geographical diversification or expansion certainly seems more strategic than sitting home and doing nothing…. Softbank is expressing some confidence with its move, but the hard part is yet to come” — that is, “[to] capture some advantage in the competitive U.S. market and, by extension, in a larger global market.”

Wharton marketing professor Raghuram Iyengar notes that while moving to another mature market is “certainly a risky move” for Softbank, “there is an upside potential … because Sprint has a major share in [wireless Internet provider] Clearwire, which has a lot of 4G spectrum. This, together with the latest push from the FCC to open up more wireless spectrum, will help Softbank establish itself as a major player in the U.S. market.”

Gerald Faulhaber, a Wharton emeritus professor of business economics and public policy, agrees. “Sprint is a good target for [Softbank], as Sprint is fairly spectrum-rich. Sprint also needs a capital infusion to expand its network into 4G LTE, where Softbank has solid experience. This will bring high-speed data to Sprint customers and allow the company to compete better against AT&T and Verizon….

“The firm at risk here is Softbank,” Faulhaber adds, because it will have to adjust to new regulators and consumer preferences. Still, “Softbank is probably the most ‘American’ of Japanese companies,” he notes. “They did very well as a broadband company by being innovative and aggressive, and customer-focused. In 2006, they bought Vodaphone Japan, and against my expectations, they have been quite successful in their entry into mobile telephony…. If it were another Japanese firm — say, DoCoMo or KDD — I would view their prospects as dim. But Softbank has pulled off real accomplishments suggesting that maybe they can pull this off.”

Wharton legal studies and business ethics professor Kevin Werbach agrees that Softbank may have what it takes to succeed. “AT&T and Verizon have consolidated the U.S. wireless market to the point where a no. 3 or no. 4 competitor isn’t viable without some differentiation…. In the Japanese market, Softbank has been an innovator in pricing models and packages for broadband and wireless. I expect it will try to be similarly creative here.”

One possibility, Werbach says, would be “for some novel partnership between Softbank/Sprint and Yahoo, which is a co-owner with Softbank of Yahoo Japan. Such an arrangement might not work in light of Google’s connection to the Android platform, and Sprint’s existing commitments to Apple for the iPhone, but it illustrates how new combinations of content and applications with mobile connectivity could produce different competitive options.”

The deal has to go through both antitrust and foreign ownership review, Werbach points out, so it will likely take some time before it is approved. If the deal does get approved, Werbach expects the company to introduce “a novel pricing scheme or other differentiation. [Softbank] has a track record of shaking things up in Japan, and I can’t see why it would want to own a flagging no. 3 carrier if it didn’t think it could change the dynamics of the U.S. market.”

Analysts are taking another look at the online social games industry after Zynga missed the mark in its second-quarter earnings report. The San Francisco-based creator of such popular online games as FarmVille and Mafia Wars had a dizzying market capitalization of $8.5 billion after its IPO last December. That has fallen to $2.21 billion following its latest results and outlook announcement last Wednesday. The firm’s second-quarter revenues were $332 million, lower than analysts’ expectations of $343 million.

The company, which claims 60 million daily active users, also lowered projected bookings for the year (the amount users pay up front for virtual goods they consume while playing) to between $1.15 billion and $1.23 billion from an earlier forecast of $1.47 billion. Zynga blamed its setbacks principally on “delays in launching new games [and] a faster decline in existing web games due in part to a more challenging environment on the Facebook web platform.” The firm’s share price has plummeted from about $15 in early March to about $3 at Friday’s close.

Zynga mainly hosts its games on Facebook, although recently the company began offering games on its own site to reduce its dependence on the social network giant. “Zynga can’t afford to put all its eggs in Facebook’s basket, but neither can it live without the enormous push that it gets from its Facebook relationship,” said Wharton professor of legal studies and business ethics Kevin Werbach in a previous Knowledge@Wharton article about the game developer’s prospects.

According to Eric Clemons, a Wharton professor of operations and information management, Zynga’s real problem is the lack of staying power that its products seem to have. He compares social games by Zynga and others to a fad like pet rocks — plain rocks that were sold by the millions in 1975 as “pets” in boxes before they quickly faded from view. In a bid to boost revenues, Zynga recently partnered with toy maker Hasbro to merchandise its games, but Clemons isn’t impressed by that, either. “Pet rocks were not followed by pet erasers” or other merchandising that were able to extend their lifecycle in any way, he notes.

Clemons points out what he sees as another shortcoming in Zynga’s business model: FarmVille players have to pay for plants, livestock or tractors to cultivate their virtual farms. “FarmVille never made any sense to me,” he says. “I have no use for games where you pay to improve your performance.” It could serve its purpose as a transient distraction from boredom, he concedes, but predicts that fickle users will require new distractions to keep them engaged. In fact, CityVille, which was launched after FarmVille, has already eclipsed FarmVille’s popularity, and the firm launched six new games last quarter.

In the previous Knowledge@Wharton article on Zynga, Wharton emeritus management professor Lawrence Hrebiniak warned of that very challenge. “Zynga’s business model depends on developing cool games and new titles to replace older ones,” he noted. “How long can Zynga do that? By the time [its] Facebook deal expires, Zynga may not be viable.”

The rapid growth in mobile phone use worldwide is good news for marketers and service providers, but challenges persist in monetizing that penetration.

Despite the fact that mobile users now make up 10% of all online traffic, ad spend in the U.S. on mobile was only 1% of the total, compared with 22% on the Internet, according to a report released last month by Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers (KPCB). Desktop Internet access scored over mobile phones in terms of average revenue per user (ARPU), the report noted: Last year, the ARPU from desktop Internet users was an estimated $49, while it ranged from below $4 to about $18 for mobile advertising at companies like Pandora, Zynga and others.

But advertisers have found desktop Internet advertising more expensive than mobile. The effective cost per thousand views in traditional online advertising is $3.50, compared with 75 cents on mobile devices, according to the report.

Kartik Hosanagar, a Wharton professor of information and operations management, says it makes sense that the ARPU is lower in mobile than on the traditional web. Mobile devices have limited screen space, and that makes it difficult to implement advertising efficiently, he points out. The nature of mobile usage presents another obstacle. “Most people access [data] on-the-go and are looking to pull information,” he says of mobile users. “Therefore, they are unlikely to linger around to consume other information/content that is pushed to them.”

However, Hosanagar finds significant untapped potential for other forms of monetization in the mobile space. “A key difference is that while most content on the web is offered for free, paid content and apps are very much thriving on the mobile side.” The monetization model on mobile will be based less on advertising and more on paid content than the traditional Internet, he says.

The KPCB report also noted that the global Internet user population (including both desktop and mobile access) grew 8% in 2011 to 2.3 billion, led by China (513 million users) and followed by the U.S. (245 million users). A Cisco report, also released in May, put the number of Internet connections worldwide at 10.3 billion at the end of 2011, and projected that the number will grow to 18.9 billion by 2016. Driving that trend will be smartphones, tablets and other handheld devices. India will see Internet traffic grow the fastest, followed by Brazil and South Africa, according to a Bloomberg report.

As all that growth plays out, Hosanagar sees “a big opportunity” ahead for Internet service providers, but he notes that there are obstacles. “Their worry, of course, is that they might end up as dumb pipes carrying bits. If so, their services will become commoditized and have lower margins.” However, he doesn’t see service providers facing difficulties in monetizing their investments in infrastructure with continued traffic growth in the medium term, especially with the increasing popularity of online video.

And while there has been tremendous progress in network speeds in recent years, the world has only harnessed a fraction of the Internet’s potential so far. “We are still having the same conversation we had 15 years ago, before the broadband revolution,” Kevin Werbach, a Wharton professor of legal studies and business ethics, said in a recent Knowledge@Wharton article. His comments came after a conference on broadband trends in April at Wharton’s San Francisco campus, organized by the school’s Mack Center on Technological Innovation and the Palo Alto-based Institute for the Future.

“We’re clearly at a fork in the road, but it’s not really clear yet what the branches are,” Werbach said about the evolution of Internet technology. “The most interesting questions are usually the hardest ones to answer.”

Only four months into his tenure, Yahoo CEO Scott Thompson was forced to step down last weekend because of a misstatement of his academic credentials in a regulatory filing. According to reports, Thompson’s official biography cited degrees in computer science and accounting from Stonehill College, whereas his actual degree was in accounting alone.

Dissatisfied activist shareholders called public attention to the error in early May. At first, Thompson said he was not aware of the misstatement, but according to the Wall Street Journal, an internal investigation at the company showed that he had allowed the inaccuracy to appear on his resume for several years. The company is now looking into whether it can fire Thompson “with cause,” which, the Journal notes, would cost him severance pay.

Meanwhile, Thompson, who replaced former CEO Carol Bartz, is the fourth chief executive to leave the firm in five years. (The company has announced that executive vice president Ross Levinsohn will serve as interim CEO.)

Given the company’s recent struggles — including declining market share and growing competition from Google and Facebook — was the decision to force Thompson out a smart one? “Scott Thompson had to go,” says Wharton operations and information management professor Maurice Schweitzer. “A fabrication on the resume costs you credibility and suggests values that place impression management above substance. This is a critical concern for Yahoo. Yahoo needs to credibly signal to the market that [it is] providing real value.”

For Thompson, “this issue is particularly serious, because he had just assumed the CEO position and had no great leadership accomplishments with which to counter the loss of credibility created by his embellished resume,” Schweitzer adds. Moreover, “the activist shareholders seeking to oust Thompson made this particularly problematic for him. When someone is motivated, you will not get the benefit of the doubt.”

A Knowledge@Wharton story on what happens when exaggeration crosses the line notes that while the urge to embellish may be part of human nature, if left unchecked, it can have career-altering consequences. “Thompson probably added material to his resume years ago as he began his climb up the corporate ladder,” Schweitzer notes. “It was wrong for him to start off with that misstatement on his resume, but as he assumed managerial roles, he should have definitely corrected this. I think leaders fail to anticipate the scrutiny they will get. What has worked for them in the past — what they have gotten away with in the past — doesn’t work when [they are] under a real spotlight.”

Wharton legal studies and business ethics professor Kevin Werbach agrees that “Thompson had to go,” but he says that the situation “reinforces the impression of Yahoo as the gang that can’t shoot straight. Now the question is whether the new leadership will continue some of his controversial decisions, such as [Yahoo's recently initiated] patent litigation against Facebook. Yet another strategic shift will create more distraction for the company.”

What can Yahoo do to regain its footing following this latest stumble? According to Werbach, “There is still a great deal of value at Yahoo. At this point, though, I have a hard time believing that any CEO could restore the company to a leadership position in the Internet market. It can be a profitable business if it scales back its ambitions and focuses on operational efficiency, but under that scenario, it will gradually lose out to more dynamic players. The alternative is a more radical shift, such as breaking up the company or becoming an open platform alternative to Google, Apple and Facebook. I would only recommend that latter course if the new management team is in it for the long haul.”