Stockprowler's pick this week is…
USURF America, Inc. (UAX:Amex)
Corporate Web site: usurf.com
Shares Outstanding: 13.4 million
Public Float: 6 million
Insider Ownership: 55%
Institutional Ownership: (6) 1% of the float
Market Capitalization: $30.9 million
Closing Price Friday: $2.31
If Baton Rouge, La. based USURF America, Inc. has its way a lot of America will be surfing the Internet via microwaves… the company's Quick-Cell™ Wireless Internet technology can offer continuous wireless Internet access at speeds equal to a T-1 line at considerable savings. In available markets, USURF America, Inc. offers 3 Wireless Access solutions to satisfy broadband demands. Users can surf the Internet up to 100 times faster than with a dial-up service for as little as $39.95 per month. Robert A. Hart, USURF's Executive Vice-President for Technology, stated "The USURF product is very special, I can see distinctly the fit that it has relative to cable modem and DSL offerings. It is unlicensed, and cost advantages are significant. In many cases, we can provide high-speed Internet access from a single USURF server modem to customers in a one-to-three-mile radius for probably one one-hundredth of the fully allocated capital expense required to provide cable TV modem and DSL service. I'm confident that a substantial number of CLECs and independent telcos will implement this technology as soon as we can deliver it to them."
The company's system operates with a broadcast signal in the unlicensed 900 MHZ and 2400 MHZ bands using 2-way modems equipped with antennas. UAX's system differs substantially from the wireless Internet access available through cellular phones and typical ISPs because nowhere is there a dependence on hard-wire to transfer data.
"The timing is right for this very competitive product," said David Loflin, USURF's president. "Until wire-based DSL can overcome major obstacles, notably its incompatibility with fiber-optic networks, distance limitations and slow and delayed availability, we should have a significant competitive advantage in our markets. The greater flexibility of our Wireless Internet access products, in general, and our Wireless DSL products, in particular, means we can provide more people with a super-fast, `always on' connection to the Internet in a much shorter time than through traditional wire-based solutions. Our immediate objectives are to satisfy the accelerating demand for bandwidth and capture market share in each of our markets. We remain convinced that the ability to deliver economical high-speed service to a large group of customers will become recognized as a valuable asset as the Internet broadband industry matures," Mr. Loflin concluded. USURF intends to target 110 U.S. cities for its wireless Quick-Cell™ systems… In a recent article ("For Phone Companies Wiring the Web, a Surprising Speed Bump", Feb. 27, 2000), The Wall Street Journal reported: "Phone companies are counting on digital subscriber-line technology, known as DSL, to be their ticket to the world of high-speed Internet access. They've also been betting on another technology, fiber optics, to upgrade the old Bell networks, at a cost of billions of dollars. Now the Bells face a difficult quandary: The two technologies are the equivalent of oil and water. They just don't mix. DSL was designed to be delivered on the Bells' century-old copper networks, not on the new fiber-optic networks. Right now, getting DSL can be an enormous headache. It can be downright impossible in many new communities that the Bell companies have wired with fiber lines."
On June 15, 2000, USURF America, Inc. announced plans to license its proprietary Quick-Cell™ wireless Internet access system to the thousands of Competitive Local Exchange Carriers (CLECs), independents and other telcos, DSL providers and Internet service providers. The price of a turnkey Quick-Cell system starts at $11,980. The Quick-Cell™ system, which requires no FCC license and can be launched in less than 48 hours and expanded to cover cities of any size, Quick-Cells can help CLECs and telcos meet the demand from customers who presently are unable to get DSL and other high-speed Internet access services. "I believe it is prudent for all new and existing Internet service providers to quickly explore and implement this new and exciting technology, to get in on the wireless Internet access revolution now," said Drew A. Hart, USURF America's Executive V.P. for Technolgy. "USURF America's Quick-Cell™ technology is extremely affordable and immensely valuable in the emerging high-speed Internet access segment.
Recently, US WEST and USURF America Inc. formed a strategic alliance… the alliance is key to USURF's nationwide Wireless Quick-Cell™ rollout, an initiative to provide Internet customers with high-speed wireless Internet connections via national Quick-Cell™ sites. "Our strategic alliance with US WEST represents a significant step forward for both USURF America and the wireless Internet industry as a whole,'' said David Loflin, president of USURF America. "We expect this relationship will provide a tremendous boost to the planned rollout of our USURF Quick-Cell™ Wireless Internet Access systems." US WEST will provide USURF America with Frame Relay Service, Private Line DS3 Corporate Backbone, Managed Data Services and access to radio towers, or Quick-Cell sites so USURF America can offer high-speed wireless Internet access to customers throughout the country. US WEST will also support USURF America customer networks with around-the-clock management to ensure reliability and security through US WEST Managed Data Services.
Analysts expect the number of wireless Internet users to reach 1 billion worldwide by 2003, up from 260 million in 1999. The value of goods and services purchased over the Internet is estimated to increase from $12 Billion in 1997 to more than $425 Billion by 2002. As Stockprowler.com has previously stated, the wireless revolution is unfolding right before our eyes… and this sector is going to experience explosive growth. USURF America, Inc. has little or no debt… however, it does need to find sources of capital to implement the planned expansion with US WEST. It is expected that in the second half of 2000, funding in the amount of $1,800,000 from the exercise of warrants will be realized. In addition, the company has filed a registration statement (Form S-1) with respect to 2,000,000 shares of common stock to be used in the expansion of the company through acquisitions.
UAX closed Friday at 2 5/16 up 5/16 for the week. The Stockprowler.com software/database has been showing moderate to heavy patterns of accumulation the past 2 weeks. Stockprowler views this as a moderate to high risk speculation with a high potential reward. Our 12 month target is $5 - $8. |
