Transcription of Finance News Network Interview with Norwood Systems Limited (ASX:NOR) Managing Director, Paul Ostergaard
Carolyn Herbert: Norwood Systems Limited (ASX:NOR) provides voice messaging and data services to consumers, enterprises and carriers around the world, leveraging its global telecommunications services network partnerships. I’m Carolyn Herbert and joining me at the CEO Sessions in Sydney is the company’s Managing Director, Paul Ostergaard. Paul, welcome back.
Paul Ostergaard: Thanks Carolyn, great to be here this morning.
Carolyn Herbert: Can you start by giving us an introduction to Norwood Systems?
Paul Ostergaard: Norwood Systems provides high quality, but low cost telecommunications services to people all around the world, using what we call over-the-top voice technologies. So we use high bandwidth data pipes to deliver really high quality, but affordable price services to customers, wherever they are. They could be travelling, or they could be just resident in a country looking to call someone overseas, at long distance rates.
Carolyn Herbert: Who’s your customer base and what’s your market for your key products?
Paul Ostergaard: So we service a global customer base and we service both consumers and corporate customers. On the consumer side, we’ve had our apps downloaded in 210 countries and 5,100 cities around the world, and now nearing about 3.5 million downloads. On the corporate side, we service anything from a small medium enterprise to a large corporate business. And our aim is to have a continuum of service opportunities use cases, for our products. All the way through from an individual kind of procurer user, all the way through to a very large multinational corporation.
Carolyn Herbert: Can you tell us a bit more about your World Phone app, how it works and what sort of benefits it delivers to users?
Paul Ostergaard: World Phone was architectured to fundamentally deliver a more reliable form of Voiceover IP. What the carriers call over-the-top voice services. Voiceover IP generally is characterised as being less reliable than your cell phone, or your normal desk phone calls. And what we’ve done is take on board, the observation that that unreliability comes from the network it travels over, which is the Internet. So what our products do is minimise how much of the Internet your calls have to travel over. And what we’ve found, proven now, is that we actually deliver a far more reliable, better quality voice service for a lot of users, in all sorts of different locations around the world.
Carolyn Herbert: How many downloads or active users do you have of the app?
Paul Ostergaard: Yes so we have about 3.5 million downloads of the app historically to date, and that’s growing steadily. We have hundreds of thousands of active users per month at this stage. And our goal is to maximise that level of engagement, and how many of the people having downloaded the app, continue to use it.
Carolyn Herbert: What is it generating in terms of revenue at this stage?
Paul Ostergaard: We’ve been delighted with the initial response. We haven’t done too many clever things in terms of driving revenue, but we’re still already generating something around a $2 million annualised run rate, off the app. So just in the last quarter, we generated nearly $0.5 million of revenue, just from the last three months.
Carolyn Herbert: Now to the company’s CORONA platform, who is that targeted at?
Paul Ostergaard: That’s been traditionally targeted at multinationals. What we’re doing at the moment, we announced in some recent releases to the ASX, is we’re making that more broadly available to everything down to a small medium enterprise, or maybe even a departmental work group. And that fits back into our strategic focus of moving the company, from not just servicing multinationals and consumers, but also spanning everything in between.
So we actually are targeting a very broad range of businesses, with a CORONA proposition. So we’ve just launched two new services called CORONA Cloud and CORONA Gts. And they’re physically being made available to customers in March and in April respectively. And we’re looking forward to customers adopting those.
Carolyn Herbert: What’s your product roadmap looking like for 2016?
Paul Ostergaard: We’ve had a lot of inbound requests about other things we can do, and at the same time also taking stock of what the market is doing. We have two key initiatives and that is to broaden our voice service offering towards our deal with messaging and data. Even my kids, when they ask when are you doing data, you start getting the sense that it’s almost becoming like water. Everyone needs Wi-Fi access.
And so we’ve not entered these markets lightly, we have good reasons for building both of these products. Because we actually, in the same way that we have fundamentally improved the reliability of Voiceover IP with our voice offering, we are delivering two keen new innovations, both on the messaging and also the data access side.
We’re releasing more details about those in early Q2. We’re in the middle of filing a bunch of patents about them, about the core concepts. And we expect probably release dates in the range of late Q2/Q3 for availability, for the public use of those. And that will round out our proposition, so that we then have a voice messaging and data multi service portfolio, which spans everything from individual consumers, all the way through to very large corporations.
Carolyn Herbert: Finally Paul, what’s the focus for the next 12 months?
Paul Ostergaard: Acquire customers, build great products that our customers love to use and make money.
Carolyn Herbert: Paul Ostergaard, thanks for the update on Norwood Systems.
Paul Ostergaard: Thanks Carolyn, great to be here.