In previous years, MWC was mainly about getting mobile network operators (MNOs) to initiate the approval process for NuRAN’s solutions which would then be available to them for purchasing and implementation. In contrast, this year’s MWC was about building on previous work and moving forward with rollouts for the African market, either through standard material acquisition model, the outright purchase by the client of the equipment, or through NuRAN’s newly implemented Mobile Network Enabler (MNE) model. Additionally, NuRAN has created new relationships, and further strengthened existing ones including global satellite operators which could provide value-added, combined with remote connectivity solutions to shared markets.
a. What can investors expect as material results from MWC?
Investors should expect increasing announcements of signed contracts and purchase orders with MNOs and satellite players, leading to a ramp up in revenue starting Q4 of this year.
b. How long does it typically take for deals to be worked out?
Deals typically take anywhere from 9 to 24 months to go from the technical qualification to getting an order for rollout. Having initiated those processes with several operators over the last two years, the interactions NuRAN has with those MNOs at trade shows like MWC stand at various stages of its pipeline.
c. What was the overall sentiment at the show?
The team is thrilled by the outcome of the show, as many of the discussions were focused around tangible rollouts and industry problem solving involving NuRAN solutions. The reaction from MNOs to NuRAN’s recently announced multi-standard, software-defined radio access infrastructure (LiteRAN xG) has been extremely well received. Everyone we talk to agrees that there is a need and relevance for the technology. Most potential and existing clients have inquired as to when the technology would be ready so they can plan rollouts accordingly.
d. What are the biggest themes in the industry at the moment?
5G, 5G and more 5G! Everyone is salivating over the new applications that will arise: from AI to IoT and universal digital inclusion, the latest being directly in line with NuRAN’s mission.
2) How is NuRAN positioned at the front of the industry in its market segment?
NuRAN has been a pioneer in remote rural mobile infrastructure solutions for some time. We deliver the world’s most cost effective and power-efficient tower-mount radios. The Company’s upcoming software-defined, multi-standard solution will keep NuRAN as the leader in its market.
a. Who else is playing in this market segment?
There are a few other players. However, in terms of delivering carrier-class solutions albeit at very low total cost of ownership (TCO), many operators have given us evidence that NuRAN remains ahead of competition. Plus, we invest a lot of human hours and hard capital in innovating, so we expect to remain at the top of our game.
3) From all the purchase orders and deals that were announced Q4 2018 and Q1 2019, where is the team in delivering on these PO’s?
The POs recently announced are planned to get delivered within the next 9 months. The announcement related to AMOS and an undisclosed MNO for $9M was stated as being conditional to financing on the MNO side, which at this stage remains to be a condition for execution.
a. What is the pipeline of sales looking like for the next 6-12 months?
Year-on-year, the Company’s pipeline has grown by 30%, which is encouraging. As stated earlier, we have reached important milestones with several MNOs, leading us to expect substantial orders are coming up in the next 6-12 months.
4) The Company has been implementing a pivot from uniquely being an OEM equipment supplier to be an end solution provider, with potential of bringing increased recurring revenues. Can you elaborate on that?
Good question. The answer is straightforward: it’s VERY big. NuRAN recently announced the signing of an agRecurring revenues originate from software maintenance plans, technical support, as well as managed services (network & performance monitoring), offered to MNOs that deploy and operate NuRAN solutions.
a. How has this been received by current and prospective clients?
It is typical in the telecom market to offer turnkey solutions so there is no client education necessary. Current and future clients value our capability of supporting them through the successful operation of their network.
b. What portion of the client base will opt in to this service?
Almost all ongoing opportunities include multi-year software maintenance and technical support plans, while we expect that around 40% of the opportunities will include managed services.
c. What is the expected revenue from this vertical in 2019?
This year revenues will originate mostly from new commercial rollouts which we have been working on for the last 2 years. We expect some revenues from the service stream will start occurring in 2019 and we expect a significant ramp for 2020.
5) What is the progress of NuRAN equipment being qualified in Kenya as announced in 2018?
We expected the trial to be completed before this summer. However, we experienced administrative delays from the MNO side which slightly pushed the schedule. That trial is now planned to start in mid-April and it should last about 4 to 6 weeks. This pilot phase is a mandatory prerequisite for the commercial deployment which should be for a few hundred sites.
6) Can you elaborate more on the credit facility extended by the province of Quebec? What is the intended use and what can investors expect?
Creativité Québec is a program handled by Investissement Québec which provides long-term loan facilities with favorable terms. The program finances up to 75% of project-related investments and expenses in the form of progressive installments following disbursements. NuRAN is leveraging the $3MM loan granted to invest in its LiteRAN xG solution. We intend on rolling out first units of the product in Africa, Asia and LATAM market for bigger deployment in 2020 and higher.
7) What is NuRAN planning for Latin America? How will the Company execute?
While Africa still sees relevance in 2G connectivity, Latin America, being a somewhat more developed market in comparison, demands broadband connectivity, which will be addressed by LiteRAN xG, and there are already considerations of such. Same goes for Asia-Pacific. The company is looking at several opportunities these markets.
8) What is NuRAN planning for North-America and more mature markets? How will the Company execute?
NuRAN’s portfolio is quickly evolving to support all mobile standards, including 5G. Currently telecom operators have to reinvest huge amounts of capital to support all the new 5G enabled tech. 5G is going to be a big deal for many years to come everywhere in the world and we will remain one of the most optimal solutions in the market for rolling out this new standard.
If you think about it, the first generation 5G mobile devices are just starting to roll out to consumers from quick-to-market Asian handset makers and networks can barely support them. Apple is apparently at least 2 years away from a 5G device. So, it is still pretty early in the 5G game and we are exceptionally well positioned.
Do you have a final message you would like to relay to current NuRAN shareholders or potential investors?
Right now, NuRAN is a compelling story for investors, the stock is priced close to all time lows while they get the benefit of the last 2 years of work and grinding that are necessary before the announcement of contracts being executed and announced to the market.