Sydney, Nov 23, 2021 AEST (ABN Newswire) - Etherstack Limited (
ASX:ESK) CEO and Executive Director David Deacon introduces the company's push-to-talk communications technology for essential services.
Lauren Evans: Hi. This is Lauren Evans for the Finance News Network. Joining me from Etherstack (ASX:ESK) is CEO and Executive Director David Deacon. David, it's nice to meet you.
David Deacon: Thanks very much, Lauren. Nice to meet you too.
Lauren Evans: Welcome to FNN. So first up, can you start with an introduction to the company?
David Deacon: Etherstack originally started out as a technology licensing company, licensing wireless software technology to other wireless equipment manufacturers around the world. And, over the years, we branched out to make our own advanced mission critical push-to-talk products that are typically used by police, fire, ambulance, public safety agencies, defence, and the resource sector -- both core software products as well as switching networks and network equipment for those industries. And the company derives its revenues from installing those networks, as well as providing 24/7 support to those networks for the essential workers in the community who operate, you know, making everything from the lights go on for us all or the ambulance come, night and day.
Lauren Evans: And could you name some of your customers?
David Deacon: Diverse range of end-user customers, such as Ergon Energy in Queensland, ATCO Electric in Canada, Jersey Central Power and Light, and the Royal Canadian Mounted Police. They use our digital radio networks to provide services to their offices and support personnel. But, in the technology licensing space, probably one of our more interesting recent announcements -- our global teaming agreement with Samsung Electronics in Korea.
Lauren Evans: Thanks, David. So, what is the market size for push-to-talk communications?
David Deacon: The total market size for push-to-talk is about $40 or $50 billion. It's really separated into three separate segments. What we call the traditional digital land mobile radio market is about a $15 to $20 billion market. And that's where the company is already growing and getting fantastic growth rates over the last three or four years and enjoying fantastic recurring revenues that are coming through for the traditional digital and mobile radio networks.
The second space is push-to-talk over cellular, which is what our deal with Samsung's very much about, which is how do we deliver push-to-talk services for government grade or emergency services grade over 5G networks going forward?
And then the third area, an emerging area, is push-to-talk over satellite. With all the new LEOs and MEOs satellites going up with a crashing price of satellite bandwidth, we can now actually afford to do push-to-talk over satellite, which really gives a whole range of new options for public safety in remote areas, such as bush fires, police, ambulance, and so on.
Lauren Evans: And David, could you provide a comment on the company's financial performance?
David Deacon: It's been a great couple of years, and this current year, as we've already advised the market, is going really well. The first half this year was up 79 per cent [sic: 76 per cent] on the prior corresponding period, and, yet again, we will be profitable, cash flow generative. We've got a really great range of deals in the pipeline at the moment. We've already given some guidance to the market about the types of targeted wins that we're expecting in the short and the medium term. So, things are really fantastic, and we're looking forward to having a fantastic 2022.
Lauren Evans: Thanks, David. Could you comment on the impact of the global rollout of 5G networks?
David Deacon: 5G networks, as we know, they're appearing all around the world, and really what's going to happen is, in urban areas around the world, there'll be much more bandwidth available to provide really rich emergency service services and public safety experiences beyond mission critical push-to-talk, but things like video and real-time information. By partnering with Samsung, we're looking at between about 60 to 90 contracts coming up in the OECD countries in the next several years that we are collectively targeting. And by piggybacking onto the back of those deployments into the countries, we're certainly hoping that we're going to get a very healthy run rate up for those wins. And beyond the developed countries, there's another probably 100 to 200 potential contracts that will become available over the next 5 to 10 years for this type of technology. We announced our first major carrier win with Samsung earlier this year, just shy of A$12 million, including the first few years' support revenues. And it's really the long-term support tails on that, it's very software as a service-like support revenues going forward. And, ultimately, at the end of the day, everything that we do and touch is to a large extent effectively government-backed, whether it's police, fire, ambulance, defence, or electric utilities. You know, it's a government-backed growth story.
Lauren Evans: So, David, what can investors look forward to in the future?
David Deacon: Across all the sectors of our business at the moment, be it the defence deliveries that we're currently doing, and the particular interest in Australian sovereign defence interests at the moment. You know, keep an eye out for the announcements in that space. Equally in the 5G carrier space. With all the stimulus spending that governments are spending around the world, and certainly will be investing in the next 5 to 10 years, that huge wave of infrastructure cash will go into public safety exercises, utilities, infrastructure, roads, bridges. And all of that, ultimately, in terms of mission critical communications flows down to the communications systems. So, fantastic tailwinds for the business. Really looking forward to the next few years.
Lauren Evans: Well, David Deacon, nice to meet you and thanks for the introduction to Etherstack.
David Deacon: Thank you very much, Lauren. Really appreciate it.
To view the video, please visit:
https://www.abnnewswire.net/press/en/108148/esk
About Etherstack Plc
Etherstack (ASX:ESK) is the world's leading licensor of wireless technologies for the digital LMR industry and the Company develops wireless products for the main digital radio communications standards known as APCO P25, TETRA and DMR. Over the past 25 years, over twenty wireless equipment manufacturers have licensed LMR technologies from Etherstack for use in their products.
MCPTT over LTE is an emerging cellular standard that provides public safety grade PTT (Push-To-Talk) solutions within 4G and 5G cellular networks. Demand for MCPTT services and equipment by telecommunications carriers and end user agencies has been steadily growing in the past few years and is expected to rise rapidly over the next 36-48 months.
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