Here's some info from their prospectus...
v7/28 sec.gov
According to Frost & Sullivan, a leading market research firm, we were the largest provider of Internet telephony services in the world in 1997 with a 30% market share.
As of January 31, 1999, approximately 60% of our customers were based outside of the United States, generating approximately 58% of our revenues during the six months ended on that date.
As of March 31, 1999, we were serving approximately 250,000 active customers and handling over 20 million minutes of use per month. Our revenue has grown substantially, increasing from approximately $2.7 million in the fiscal year ended July 31, 1997 to approximately $12.0 million in the fiscal year ended July 31, 1998. In addition, we had revenue of approximately $13.2 million for the six months ended January 31, 1999.
We incurred net losses of approximately $3.5 million during fiscal 1998 and approximately $2.1 million for the six months ended January 31, 1999. As of January 31, 1999 we had an accumulated deficit of approximately $7.8 million. We have not achieved profitability to date and expect to continue to incur operating losses for the forseeable future. We expect that operating and marketing expenses will increase significantly during the next several years.
Netscape Communications agreed in January 1999 to embed our PC2Phone software into future versions of its Internet browser released during the term of our agreement, including Netscape Navigator and Netscape Communicator. Netscape will also include a Net2Phone icon on the Netscape Navigator Personal Toolbar and integrate our services into Netscape Netcenter, allowing Netscape users to access our services from anywhere on the Web. According to International Data Corporation, a leading market research firm, Netscape had 41.5% of the browser market in mid-1998.
Our services are also integrated into several leading Web portals, including Yahoo!, Excite, GeoCities, InfoSpace.com and ZDNet. Additionally, we have entered into distribution and software-bundling arrangements with leading computer equipment and software companies, including IBM, Packard Bell-NEC Europe and Creative Labs.
Competition could reduce our market share and decrease our revenue.
The market for our services has been extremely competitive, and is expected to be so for the foreseeable future. Many companies offer Internet telephony products and services, and many of these companies have a substantial presence in this market. Most of the current Internet telephony products permit voice communications over the Internet between two parties that are both connected to the Internet with sound-equipped personal computers and where both parties are using identical Internet telephony software products. Current product offerings include VocalTec Communications' Internet Phone, QuarterDeck's WebPhone and Microsoft's NetMeeting.
In addition, a number of large telecommunications providers and equipment manufacturers, such as Cisco, Lucent, Northern Telecom and Dialogic, have announced that they intend to offer server-based products. These products are expected to allow voice communications over the Internet between parties using a personal computer and a telephone and between two parties using telephones. Cisco Systems has also taken a further step by recently acquiring two companies that produce devices that help Internet service providers transition voice and data traffic to cell and packet networks while maintaining traditional phone usage and infrastructure. Internet telephony service providers, such as ICG Communications, IPVoice.com, ITXC, RSL Communications (through its Delta Three subsidiary) and VIP Calling, route Internet telephony traffic to destinations on a worldwide basis. In addition, major long distance providers, such as AT&T, Deutsche Telekom, Frontier, MCI WorldCom, and Qwest Communications, as well as other major companies such as Motorola and Intel, have all entered or plan to enter the Internet telephony market. Many of our competitors are larger than and have substantially greater financial, distribution and marketing resources than we do. We cannot be certain that we will be able to compete successfully in the developing Internet telephony market.
Partial Ownership:
IDT Corporation owns ......................... 27,622,090 shrs
SOFTBANK Technology Ventures IV, L.P. owns ... 4,590,000 shrs
America Online owns ...................... 2,295,000 shrs
|
