Putting WiMAX in MotionRedline Corporate Overview Kevin F. R. Suitor VP, Corporate Marketing September 30, 2009
Legal Disclaimer This documentation is a presentation of general background information about Redline Communications Group Inc.’s (“Redline”) business and activities current as of the date of this presentation, unless otherwise indicated. It is information in a summary form and does not purport to be complete. Certain statements in this presentation may contain words such as "could", "expects", "may", "anticipates", "believes", "intends", "estimates", "targets", "envisions", "seeks" and other similar language which may constitute forward-looking statements or information under applicable securities legislation. These statements are based on Redline’s current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Redline operates. These statements are subject to important assumptions, risks and uncertainties, which are difficult to predict and the actual outcome may be materially different. Further, actual results or events could differ materially from those contemplated in forward-looking statements as a result of the following (i) risks and uncertainties relating to Redline’s business including: significant competition, competitive pricing practice, cautious capital spending by customers, industry consolidation, rapidly changing technologies, evolving industry standards, frequent new product introductions and short product life cycles, and other trends and industry characteristics affecting the telecommunications industry; any material adverse affects on Redline’s performance if its expectations regarding market demand for particular products prove to be wrong; any negative developments associated with Redline’s suppliers and contract manufacturing agreements including our reliance on certain suppliers for key components; potential penalties, damages or cancelled customer contracts from failure to meet delivery and installation deadlines and any defects or errors in Redline’s current or planned products; fluctuations in foreign currency exchange rates; potential higher operational and financial risks associated with Redline’s efforts to expand internationally; a failure to protect Redline’s intellectual property rights, or any adverse judgments or settlements arising out of disputes regarding intellectual property; changes in regulation of the wireless industry or other aspects of the industry; any failure to successfully operate or integrate strategic acquisitions, or failure to consummate or succeed with strategic alliances; Redline’s potential inability to attract or retain the personnel necessary to achieve its business objectives or to maintain an effective risk management strategy; (ii) risks and uncertainties relating to Redline’s liquidity, financing arrangements and capital including: any inability of Redline to manage cash flow fluctuations to fund working capital requirements or achieve its business objectives in a timely manner or obtain additional sources of funding; or any negative impact on Redline’s ability to make future acquisitions, raise capital, issue debt and retain employees arising from stock price volatility and any declines in the market price of Redline’s publicly traded securities. Unless otherwise required by applicable securities laws, Redline disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Overview:Redline Communications
Business Overview Redline is a leading manufacturer of WiMAX and proprietary broadband wireless infrastructure products for telecommunications carriers and other network operators. History:Founded in 1999, with HQ in Toronto, Canada, R&D centers in Toronto, Bucharest & Craiova (Romania) and a proven team of approximately 200 people in 16 countries Top Tier Customers:Including China Telecom, Zain, MTN, TIM/Personal, China Unicom, Saudi Telecom, T-Mobile, OTE, PTCL Lintasarta, Telus, TeraGo, Clearwire, Towerstream, VIBO, Tatung Infocom, AGIP, Chevron, Saudi Aramco, US Army, Hydro One and NPB Pakistan Market Traction: More than 150,000 systems deployed in 129 countries, 170+ WiMAX deployments, 70+ Commercial WiMAX Networks Revenue Growth:Over $200M cumulative revenue growing from $1.7M in ’02 to $43M in ’08 – CAGR 57.4%, YTD’09: $19.95M Financing History: $122M invested since 1999 from TSX IPO (Oct ’07); AIM IPO (Dec ’06); Telemedia Corp, Matrix Partners,US Venture Partners & GF Equity Share Information: TSX: RDL
Filling the Broadband Wireless Needs Low-Latency High Capacity Access Low Cost Fixed/Nomadic Access Mobility RedCONNEX™RedACCESS™ RedMAX™ 802.16d 802.16 RedMAX4C™ Beyond WiMAX 802.16e Fixed WiMAX Mobile WiMAX
Overview:Market Opportunities
Why Broadband Wireless is ideal for delivering service … especially in Emerging Markets Cellular data – Not viable for Enterprise subscribers Satellite– Very expensive – High Latency prohibits many applications T1 / E1 – Not scalable, no burst rate, truck-roll to upgrade DSL / Cable – Copper required – Very high start-up cost Fiber – Very Expensive – extended deployment cycles due to right of way, permits etc. Broadband Wireless “ANYWHERE & NOW” Mega site, Street site Indoor Coverage Fill-in Wide areacoverage nodes Wide area coverageand road coverage Urban 60-80% DU 1-3 % SU & R 20-30%
Broadband Wireless in Emerging and Developed Markets – vastly different drivers A 2007 study by the Brookings Institution and MIT found that a one-digit increase in U.S. per-capita broadband penetration equates to an additional American 300,000 jobs. If our broadband penetration were as high as a country like Denmark, for example, we could expect more than 3 million additional jobs in America. Source URL: http://www.huffingtonpost.com/timothy-karr/obamas-broadband-roadmap_b_149321.htm...
Worldwide Stimulus Opportunity Governments worldwide are funding BB programs as part of stimulus efforts Key verticals are: Manufacturing, Construction, Transportation, Energy and Healthcare Emerging Markets have committed $5B to BB acceleration to date according to Pyramid Research BB penetration is correlated with GDP Wireless is most efficient and cost-effective way to reach the unserved and underserved Next Generation Wireless will be Spectrally Efficient – All-IP – Low Cost – Open Business Models
Have deployed (AN-50 and AN-80i), across multiple market rollouts
High speed IP based backhaul spurs, connecting to licensed radios rings
Deployment mostly PTP high speed
Used to aggregate “WIMAX” access radios from Motorola
Clearwire TeraGo Clearwire is the most important WIMAX deployment in the world They chose Redline for LE backhaul TeraGo continues to expand their relationship with Redline
Canadian WISP covers most major cities
Winnipeg, Edmonton, Toronto, Ottawa, etc.
Build a licensed ring around strategic areas
Use Redline for backhaul and spurs
In Q1 of 2008 they expanded their relationship to deploy Redline’s RedACCESS system for premium access services to business customers
More than 5 Mb/s services
They have deployed a combination of AN-50 and AN-80i
Towerstream
Several hundred radios installed
Mostly PMP, combination of AN-50 and AN-80i (sometimes mixed cells)
Selling 5 Mb/s ($600 / month) and 9 Mb/s ($999/ month) to business customers
Towerstream chooses Redline for high end business services BWI ProductsBackhaul & Premium Access Orascom
Several hundred radios installed
Mostly PTP, combination of AN-50 and AN-80i
Using the product for mobile data backhaul and mobile voice backhaul with PWE 3rd party solution
Orascom chooses Redline for mobile backhaul solution
Redline’s WiMAX Customer Base170+ WiMAX deployments in 75 countries … Countries where RedMAX/RedMAX 4C deployed are shaded in light red 70+ Commercial Networks carrying revenue generating traffic
Zain Bahrain MTN Cameroon RedMAX ProductsBusiness and Residential Access
Joint venture of Vodafone Group and Kuwait’s MTC Group
Chose RedMAX for first WiMAX deployments
Launched limited fixed and nomadic WiMAX services to both residential and business customers in July 2007
Deployed 180 sector controllers covering 95% of the Kingdom by September 2007; have attracted over 15,000 subscribers by March 2009
Expects to invest up to US$53 million in its WiMAX infrastructure over the next 3 years
Subsidiary of the MTN Group –multinational telecommunications group operating in 21 countries in Africa and the Middle East
Selected RedMAX for its 12-city WiMAX network rollout
Initial networks in Douala and Yaoundé with 280 sector controllers deployed within 3 months of start-up
Capacity to serve thousands of users and will offer VLAN services to more than 700 corporate customers
Expects to extend its services to more than 12,000 residential users in Douala and Yaoundé
“These investments are based on a sound commercial basis and accurate financial forecasts, which allow us to expect good demand and provide excellent services in accordance with the requirements of the license, and will result in the success of our WiMAX services in the Kingdom [of Bahrain].” — Dr. Ahmed Al Shatti, COO, Zain Bahrain. MTN Cameroon continues to expand their relationship with Redline recently adding VoIP capability to the service offer.
Saudi Arabia national telecommunications company offers fixed, mobile, data, and internet services to personal, homes and enterprise users
STC currently serves more than 20 million subscribers in Saudi Arabia and more than 17 million subscribers in its international markets covering India, Malaysia and Indonesia and owns the 3rd mobile license in Kuwait.
Network consists of more than 450 sector controllers support several thousand business clients with 200 additional sectors being deployed with capacity to serve hundreds of thousands of users
Subsidiary of Telecom Italia
Launched services in spring 2007
Over 12,000 subscribers operational
Growing at a rate of >80 subscribers per day
Capacity of more than 500 users per sector
Saudi Telecom TIM/Personal Saudi Telecom chooses Redline for high end business services and residential access services TIM/Personal chooses Redline for residential access and business services
Redline: the ideal BBW platform Technology Ingredients of Next Generation Broadband Wireless: OFDM / OFDMA MIMO, BF All IP Architecture Wide Channel Bandwidth New Spectrum Redline has core technology DNA and proven platform implementations of this DNA – AN-80i, RedMAX, RedMAX 4C Engineering team capable of development versus integration Proven expertise and channel relationships in BBW with reference customers in both emerging and developed markets
Redline is a leading provider of WiMAX and Broadban more
Redline is a leading provider of WiMAX and Broadband Wireless Infrastructure products. Redline's solutions have been deployed by service providers, utility and oil and gas companies, transportation and public safety organizations, and military and municipal organizations worldwide to support the reliable delivery of voice, video and data traffic. Redline's products are uniquely suited for communications networks that have specific requirements for wireless traffic such as video surveillance and Smart Grid networks. less
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