Packet8 Releases Revolutionary Mobile VoIP App. How Will the Industry React?
 International calls from your mobile phone just got a lot cheaper. At least that is if you choose to subscribe to the new Packet8 MobileTalk mobile VoIP service. VoIP provider 8x8, Inc. (Nasdaq: EGHT - News) today announced the availability of a mobile VoIP calling service that is now compatible with more than 450 cellular phone models. The service connects international calls from mobile phones to 8X8's VoIP network and allows the user to save a bundle on foreign calls. "Packet8 MobileTalk is a breakthrough application that dramatically improves the international mobile calling experience from start to finish," said 8x8 Chairman and CEO Bryan R. Martin in a press release issued last Monday. "Most mobile phone users typically avoid placing overseas calls from their cell phones because of the exorbitant rates their mobile carriers are charging. With Packet8 MobileTalk, subscribers won't think twice about calling Europe or Asia because instead of $1.00 to $3.00 per minute, they will be paying as little as $.02 to $.05 per minute over the Packet8 network to most destinations." This development is surely resonating in the minds and boardrooms of competing VoIP service providers this morning. Only time will tell, but we could be seeing industry faced with the decision to either beef up their offerings with mobile services, or take the SunRocket route. Labels: 8X8 Inc., Mobile VoIP, Packet 8, Packet 8 Mobile Talk, VoIP, VoIP provider
Telco Stocks Have a Leg Up Vs. Cable Co's in VoIP World
 I've always been a firm believer that it will be the larger Telcos (see AT&T and Verizon) that cash in on VoIP and the next generation of communications while the cable companies, once thought to be the cash cow in terms of VoIP, will see their US customer bases decline and don't profit to any great extent from the technology. It appears that another factor aside from the telcos huge international networks and ability to leverage VoIP into their network backbones to reduce transmission costs and improve profits. I read an article this morning on http://www.bloggingstocks.com/ entitled " FCC may take away many cable company benefits". The piece voices the opinion that cable companies may indeed have their best days behind them. Check it out. This is especially worth a read for investors looking to cash in on the VoIP craze, but unsure of who will profit in the long run. http://mot.bloggingstocks.com/2007/11/12/fcc-may-take-away-many-cable-company-benefits/According to the article:"A section of the 1984 Cable Act says that when cable systems with 36 or more channels are available to 70% of households in the U.S. and 70% of those households subscribe to them, the commission may 'promulgate any additional rules necessary to promote diversity of information sources.That may mean that the commission could force cable to offer smaller channels carriage on their systems at lower rates. And, it could cause the government to block acquisitions by the larger cable companies to keep them from becoming more dominant.Cable will, of course, will fight any assault in Congress and the courts, if necessary. The FCC is likely to get some concessions out of cable, if it does not get its way outright. Add that to the assault by big telephone companies and cable stocks may have seen their best days."Labels: Cable Companies, Telcos, VoIP
Can VoIP Help Substitute a $10 Technician for a $.10 Data Transmission?
Massive Opportunity Present for VoIP Wholesalers: Which Ones Will Capitalize
 With On World Inc. estimating that the number of VoIP users will balloon from about 16M in '06 to 207M by 2011, capable VoIP players will be faced with great deal of opportunity over the next few years. But while many wholesalers have made a boatload on what many label "VoIP arbitrage" over the past half decade or so, as large telecom's such as AT&T enhance their respective service offerings, competitors must advance their value propositions from strictly cost-effective pricing structures to include an increasing number of value-added services or risk being passed over in favor of the big boys. Article on AT&T's expanded service offering: Although many consumers have been drawn in by VoIP's cost efficient characteristics, the next wave of growth, despite being somewhat apparent, may take a bit more to incite. I think that many consumers need to be compelled to use VoIP as an alternative to traditional telephony. Bundling features with other industry players, enhancing security and call quality are all areas that many lower-tiered suppliers should be focusing on now, before the big telecoms swallow up all of the guppies. Labels: VoIP
A Boost For The Global VoIP Market?
 With nearly 30 EU telecom regulators aiming to put in place standards that allow for citizens to utilize the same VoIP phone number in any European Union country, it's likely that more in the region will utilize the technology in the coming years. This is just another positive development in the VoIP world. Labels: VoIP
ABI Says WholeSale VoIP Segment Poised for Growth
 With the North American Residential Video market becoming increasingly saturated - research firm ABI Research indicates that the wholesale VoIP sector is becoming an increasingly attractive prospect for cable providers yearning to hedge their losses brought on in part by declining video revenues. This could make things even more interesting for VoIP providers of all sizes, from IBASIS Inc. (NasdaqGM:IBAS) to ATSI Communications Inc. (OTCBB: ATSX). According to a recent write up by Mae Kowalke, TMCnet Associate Editor that summarizes the ABI report: "For 2007, ABI predicts that residential video will account for roughly $170 billion in revenues worldwide; voice, data, SMB/cellular backhaul and advertising collectively will add another $92 billion. By 2012, ABI estimates, though, those figures will be almost equal, at $268 billion for video and $279 billion for other services—with the supporting players overtaking video. "
Here's a link to the article. Just another promising development for capable VoIP service players:
Labels: ATSI, ATSI Communications Inc., ATSX, IBASIS, VoIP
ATSX: Growing Like Gangbusters
 ATSI Communications Inc. (OTCBB: ATSX), one of my favorite portfolio companies at this point in time, continues to impress with its continuously improving financial situation. Their revenues are up 116% year-over-year and have grown, I believe, in 12 consecutive quarters. Despite margins, which remain thin like many other VoIP players, ATSI produced record gross profits, its 5th consecutive quarter of positive cash flow from operations, and 3rd consecutive quarter of net positive earnings per share. ATSI’s recent success is directly attributable to management’s ability to maintain extremely favorable business relationships in key emerging regions including Latin America and Asia-Pacific where many prospective telecommunications carriers lack the proper regulatory licensing and optimal transmission capabilities necessary to operate. An entrenched position in Mexico through a unique 30-year, long distance concession license with the local government has facilitated transformational financial improvements for the company and also provides a high level of opportunity going forward as VoIP and Internet adoption surge in the region. Look out for this stock to continue to impress going forward. At just over a quarter, you may want to kick off your due dilly now. Look out soon for some buy side research from us that details the good, the bad, and the ugly; as it pertains to ATSI Communications Inc. Labels: ATSI, ATSI Communications Inc., ATSX, Earnings, VoIP
A Chink in VoIP's Armor?
  A co-worker of mine pointed this article from Forbes magazine out to me earlier this week and I found it pretty interesting:  http://www.forbes.com/2007/08/02/voip-security-flaws-tech-internet-cx_ag_0802techvoip.html?partner=daily_newsletter
The bottom line here, which I suppose is no shocker, is that despite how far VoIP has come in terms of its technological development, and despite its cost-effective nature, the technology remains more vulnerable to attacks than traditional circuit-switch technology. If you've used VoIP before, you also realize that the call quality is not quite there yet either. But hey, there's usually always a trade-off when your number one purchasing decision criteria is weighted more towards price rather than quality. And I'm not dissing VoIP, I have a VoIP phone in my office and use it quite a bit. Furthermore, consumers around the world are adopting VoIP at a record clip and it likely will one day be the Supreme method of voice communication. Nobody is perfect and apparently the saying rings true to VoIP as well. So apparently the challenge is on for VoIP providers to fortify their offerings and make them as less susceptible to attack as humanly possible. This could be a make or break situation for many industry players. Labels: VoIP
Business Journal Coverage of ATSI
 Often times, it is quite a chore to find good information on the micro and small cap companies MicroStockProfit.com and other independent publications cover. Even when you do find a source, they tend to have a tilt toward the buy or an optimistic way of seeing things. Luckily for followers VOIP or investors interested in ATSI Communications, The San Antonio Business Journal has decided to do a little research and report on the company. In an article entitled "Local Telecom Firm ATSI Has Found Its Groove CEO Says" It states that ATSI has risen from the proverbial ashes over the past three years and now looks to gain significant share in the global VoIP marketplace. A testament to ATSI's recent 180 degree turn around is the company's surging revenues, which grew from $1.3M in 2004 on the verge of bankruptcy, to nearly $32M in fiscal 2007 where ATSI expects to turn its first profit since inception. This one sure deserves a read. . . VoiP is where it's at Well-respected industry sources such as On World Inc. are estimating that the number of VoIP users will balloon from about 16M in '06 to 207M by 2011. And other research houses such as In- Stat state that the technology's strongest growth will occur in regions outside of the U.S. Obviously, ATSI is playing in some of the world's hottest markets. The company is also turning a profit, quite impressive as the Vonage's of the world continue to take a vicious beating and expend exorbitant amounts of resources on acquiring just one single customer. ATSX shares are currently trading at a price of $.23 on the OTC bulletin board, nearly 70% of its 52 week high of $.39. ATSX shares were formerly traded on the American Stock Exchange. In the recent San Antonio Biz Journal write-up, management states their dedication to once again obtaining listing on a senior stock exchange. Excerpt from article:Smith says that with the company's strong recent growth, the issues with the AMEX are behind it and he says ATSI will be able to meet the exchange's requirements in the future. "Our growth trend will continue," Smith says. "We have had a tremendous year." The Turn-Around ContinuesPosting record revenues each quarter since 2006, experiencing greater than 100% revenue growth in '07 while turning a profit and developing a well- entrenched position within the world's fastest growing communications markets, ATSX is also diversifying its business to facilitate further growth. From the SA Biz Journal article:Although Smith declined to provide details, he says the company is looking to launch a new product in the coming fiscal year and is looking at a possible acquisition. "We are exploring several strategic initiatives that would diversify our product line beyond the international VoIP service," Smith says. "We need to move beyond that VoIP. (The company) may take a different form in the future." With revenues surging, a bottom line improving like never before and all indicators of industry growth pointing upwards, it looks like all of ATSX's ducks are in a row. With ATSI's 10K due out in October and the stock price trading at a nearly ¾ discount from its 52-Week high, now could prove to be a bargain basement shopping opportunity before the market floods in. It's back to school time folks. Time to do your homework! Labels: ATSI, ATSX, VoIP
ATSX: Conquering the Mexico Market
 Remember when long distance calls were 25 cents a minute? Hail to the technology age where phone calls are clearer than they have ever been, cheaper than they have ever been and apparently far more efficient than I ever knew. (And yet my cell phone does not even work from my own home - how is that possible?) Regardless of the qualms with my cell phone service, I still find it quite incredible how the world communicates seamlessly and more efficiently every day. And the new thing is still not satellite ( hopefully that is next) but broadband phone service. And boy do I have the company for you to sink your teeth into.  Gracing our pages today is not only an undervalued provider of the aforementioned services but also a technology company that stands to capitalize on the ongoing de-monopolization of the Latin American communications industry while providing some very exciting investor returns in the often-slow summertime months. Boasting 11 consecutive quarters of record revenue growth, 4 consecutive quarters of positive cash flow from operations in addition to 2 consecutive quarters of earnings per share, ATSI Communications (OTCBB: ATSX) is developing a strong competitive position in the surging international VoIP market.
Announcing today that annual revenues have already surpassed $30,000,000 for FY2007, up more than 100% from the $14.7M logged in '06. With more focus on bottom line expansion than top line growth, ATSX is capitalizing on a number of extremely positive trends including: increased international trade, international travel, immigration, and overall ramped up international communications traffic.
To give you a brief background. . . ATSX's Digerati Networks, Inc. subsidiary is a well-entrenched provider of International Voice over Internet Protocol (VoIP) services. It operates its own network that now services emerging markets in Asia, the Middle East, and Latin America.
Currently, the main focus is on Mexico, the world's top producer of voice traffic. ATSX also owns a minority (49%) interest of a subsidiary in Mexico, ATSI Communications, S.A. de C.V., which operates under a 30-year government issued telecommunications license similar to the license owned by AT&T's subsidiary in Mexico. This contract has been in place since 1998 and gives the entity the right to install and operate a public network. I'm not sure there's a bigger competitive roadblock possible for potential market entrants.
Have we lost you?
 Since we may not all be fully versed here, let's expand for a minute on some of this relatively new tech jargon. According to Wikipedia - Voice over Internet Protocol, also called VoIP, IP Telephony, Internet telephony, Broadband telephony, Broadband Phone and Voice over Broadband is the routing of voice conversations over the Internet or through any other IP-based network. As evidenced in recent years, the communications industry is in the midst of a paradigm shift from traditional circuit switch networks to Internet transmission of global voice communication data. While traditional circuit-switch systems incur unnecessary costs on a per call basis because valuable network resources must be dedicated whether parties are actually speaking, data networks such as VoIP break down voice transmissions into, small, individually addressed data packages or "packets" that are routed independently and do not waste bandwidth when no transmission occurs, therefore allowing for the network to carry more calls with the same bandwidth. In response to this technical innovation, communications carriers worldwide are scurrying to provide service.
On a very positive note for ATSX, the company's current infrastructure can be maintained with very little overhead. Since Internet technology is much more efficient and routing/transporting calls online can be done at a fraction of the cost of traditional telephone communication, ATSX is not subject to direct payment for relaying calls, rather buying large high quality "pipes" into the world wide web that are billed by bandwidth rather than usage.
For those of you wondering, here's how it all works: The telecom carriers of the world are fully cognizant of the growing demand for the transmission of international voice traffic and need efficient VoIP networks to optimally support the process. The only problem is that many of these suppliers lack what it takes to meet this rising demand.
"In its VoIP operations, Digerati receives voice traffic from originating carriers who are interconnected to its network via the Internet and routes that traffic over the Internet to local service providers and carriers in the destination countries with whom the Company has agreements or partnerships to manage the completion of the call. Digerati's global VoIP service enables carriers and other communications service providers to outsource international voice and fax traffic." (ATSX annual filing) This is where ATSX has grown its revenues from $1.6M in '04 to already $30M thus far in 2007. The company's key competitive advantages lies in its holding of proper licenses, network redundancy, favorable termination agreements, and the presence of an optimal business infrastructure and relationships in some very lucrative markets - particularly Mexico. While the market is flooded with "rip off" services, mainly of low communication quality that simply "hacks" in to existing pipes, and also controlled to some extend by major carriers, ATSX has been able to gain a solid foothold by building a brand associated with value and quality. According to the company. . . Digerati's market for international voice traffic is growing 11% per year and was expected to reach 291 billion minutes of use ("MOU") in 2006. ATSX also states that International VoIP traffic is growing faster than traditional circuit-switched traffic, accounting for 16% or 41 billion minutes of all international voice minutes in 2005. All This - Undervalued  In terms of valuation, there is a strong argument for a much higher share price than current levels - by as much as 2X - 4X. For the sake of discussion, let's look at the 2X argument. Applying a conservative P/S multiple of .77 (based on IBAS: NASDAQ) on our trailing 12 month revenue of $27 million, market cap would be approximately $21 million. With $37 million shares outstanding (only overhang is management and board stock options / no warrants) this would equate to roughly $0.56 per share or a 133% premium to today's levels.
We think the facts and trends here speak for themselves here. When it comes to communication, opportunity is stronger in regions lacking infrastructure. As ASTX builds a name for themselves in one of the largest (and most needing) communication markets, we think we will see much greater things to come from this company - and some pretty nice returns for shareholders. .
Labels: ATSI, ATSX, VoIP
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International calls from your mobile phone just got a lot cheaper. At least that is if you choose to subscribe to the new Packet8 MobileTalk mobile VoIP service.
