OTC Journal:
Hello and thank you for joining the OTC Journal in the first of a series
of interviews I will be conducting with companies I've featured throughout
2003. The purpose of this interview series is to give you the opportunity
to hear directly from the management concerning their business model, industry
group, and plans for the future.
I hope this will help
you better evaluate your own comfort level in owning shares in any of these
companies. I remind you that any investment in the companies the
OTC Journal features should be viewed as highly risky.
Please visit our Web
site at www.otcjournal.com and read our Mission Statement. Also please
take the time to read our article entitled Are Microcaps For You? by Dr.
Richard Geist and our section entitled Rules For Successful MicroCap Investing.
Now before we begin the
interview let me read the Safe Harbor statement. This interview contains
forward-looking statements including without limitations statements concerning
our business and possible or assumed future results of operations.
Our actual results could differ materially from those anticipated in the
forward-looking statements for many reasons including our ability to continue
as a going concern, adverse economic changes affecting markets we serve,
competition in our markets and industry segments, our timing (and) the
profitability of entering new markets, greater than expected costs, customer
acceptance of wireless networks or difficulties related to our integration
of the businesses we may acquire, and other risks and uncertainties as
may be detailed from time to time in our public announcements and SEC filings.
Although we believe the
expectations reflected in the forward-looking statements are reasonable,
they relate only to events as of the date on which the statements are made
(and) our future results, levels of activities, performance, or achievements
may not meet these expectations.
We do not intend to update
any of these forward-looking statements after the (date) of this document
to conform these statements to actual results and to changes in our expectations
except as required by law.
Okay today I'm pleased
to be joined by (Mike) Novielli the Chairman of Network Installation. Network
Installation trades on the Over The Counter Bulletin Board symbol NWIS.
The first question is,
(Mike), thanks for joining us today. (Mike), the arrival of WiFi
and wireless networking appears to have created a sudden and sort of insane
frenzy. What do you suppose the reason for that is?
Michael Novielli:
Larry, thanks for having me today. To address your first question,
while it may appear that this shift to wireless networking was so sudden
the fact is wireless networking technology has been with us for a number
of years now. For example my laptop computer is three years old.
And one of the features which initially sold me on it back then was its
wireless capabilities. Well three years ago wireless (Web) - wireless
networks although they existed they were pretty rare. But I knew
it was only a matter of time before this technology would become mainstream.
Today though I gain Internet
wire - I gain wireless Internet access by physically inserting a wireless
card directly into my laptop. But by today's standards that's archaic.
Most new laptops today come fully equipped with a wireless chip inside.
So the point here is although the technology has been around, the infrastructure
hadn't arrived. But now that infrastructure is being built at warped
speed worldwide and hence all the recent fanfare about WiFi and wireless
networking.
OTC Journal: (Mike),
it seems that everywhere I go these days wireless Internet access is exploding
just in public places. You know, a year ago the only place I (can)
think of that had wireless access was the Starbucks. Today it's in
almost all coffee shops and bookstores and copy places. You know,
airports have them all over the place.
As a matter of
fact I was reading in New York City a lot of streets have wireless access
now. I know many people are installing wireless networks in their
homes. And recently I've been reading that the computer manufacturers
are reporting strong sales of the laptops with built-in wireless technologies.
I've been reading that
many are (likening) the growth in this arena to the wireless (Toko) build
out of five years ago. So, (Mike), tell us how big do you think this
market is going to get and how fast is it growing?
Michael Novielli:
Well currently it's estimated that approximately 30 million U.S. business
travelers carry laptops. By 2005 laptop computer use is estimated
to grow domestically to about 60 million units while worldwide usage is
predicted at more than 150 million units.
Regular wireless users
were estimated at about 2 million last year in 2002 and that number's predicted
to grow to more than 20 million by 2006 just in the U.S. alone. So
we're talking about a (hyper-growth) market here.
OTC Journal: (Mike),
can you cite a few examples of some of the high profile or larger-scale
projects which would seem to validate this wireless concept?
Michael Novielli:
Sure. The obvious examples are the previously mentioned Starbucks
coffee shops or McDonalds or Marriott hotels which are rolling out or have
rolled out WiFi hotspots nationwide. As a matter of fact St. John's
University in New York recently spent $7 million on a campus-wide wireless
network and there - have equipped all their students with IBM wireless
laptops.
And just yesterday it
was reported that the city of Cerritos, California announced its intentions
of becoming the first completely wireless-zoned city or MAN which stands
for Metropolitan Area Network.
OTC Journal: So
could you describe - let's shift gears then from the market which appears
to be growing at ten fold over the next three years and talk specifically
about Network Installation and its market niche within this explosive growth
market. Where does Network Installation fit into this market and
how quickly can Network Installation grow?
Michael Novielli:
Well our core competency, Larry, has been the actual design, install, and
deployment of traditional high-speed wired networks for the Fortune 1000,
government, local municipalities, the K-12 market, and higher education
- the university system.
As a matter of fact our
current (install) base includes clients such as Wells Fargo, UCLA, USC,
Orange and Los Angles Counties just to name a few. While these enterprises
and other establishments in these sectors are now some of the largest consumers
in the conversion to wireless. And as I cited earlier, the demand
is literally increasing exponentially. The ability to meet that demand
is both natural and (seamless) for Network Installation.
OTC Journal: So
your installations are bridging just these little hot spots into these
larger institutional installations, correct?
Michael Novielli:
Well WiFi technology is used in wireless networks. So whether you
deploy a traditional 802.11 standard or another application that's dependant
on a number of different variables including the location, number of users,
and the scalability. And our agreements with Motorola and Vivato
give us the flexibility to meet the demands of designing a wireless system
regardless of the application that is required.
OTC Journal: So
moving forward then could you briefly describe some of the company's recent
accomplishments?
Michael Novielli:
Sure. Just several weeks ago we announced that we were awarded a
wireless networking contract from the City of Barstow, California which
(calls) for the deployment of a wireless network for the city's police
department. The conversion to wireless networking for law enforcement
is a trend we're seeing nationwide now.
We also recently announced
a wireless project for the Ocean View School District in Huntington Beach,
California. And we continue to consistently receive repeat business
from UCLA and USC which are both extremely valued clients.
OTC Journal: So,
(Mike), then looking out to 2004, where do you expect your primary growth
to come from in 2004?
Michael Novielli:
Well our primary drivers for next year will continue to be our focus on
the build out of the wireless infrastructure both organically and through
one maybe two potential acquisitions. Voice over IP or voice over
Internet is also another derivative product and service where we see substantial
growth for Network. As a natural progression we plan on widening
our portfolio and becoming a player in that market as well.
OTC Journal: (Mike),
could you dust off the crystal ball and look out past 2004 into 2005 and
beyond and talk a little bit about your long-range plans for the company?
Michael Novielli:
Well obviously this is just my humble opinion but looking into early 2005
our business plan calls for a nationwide footprint initiative whereby Network
Installation can service virtually the entire U.S. directly - even internationally
as opposed to a nationwide-affiliate network from which we currently operate.
Obviously this would dramatically increase our profit margins which presumably
would lead to increase in shareholder value.
OTC Journal: Well
I think we've covered all the highlights I wanted people to understand
about the company, (Mike). Thanks so much for your participation.
And I'd like to thank everybody for joining the OTC Journal and (Mike)
Novielli the Chairman of Network Installation.
We'd really like to have
your feedback on these interviews. We'd like to know if you like
this format. And we'd like to know if you find it valuable or if
you have any suggestions on how we could make it better.
So please email your
comments to editor@otcjournal.com.
We'll be back later this month with another key interview. And thanks
so much for your participation.
|