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"HELO"
HELLO DIRECT STRENGTHENS INTERNET LEADERSHIP WITH ACQUISITION OF
PhoneZone.Com Telecom Products Marketer to Accelerate Electronic Commerce, Broaden Product
and Service Range with Integration of Successful Web Buyers Guide
SAN JOSE, Calif., Jan. 11 /PRNewswire/ -- Hello Direct, Inc., (Nasdaq: HELO), the leading developer and direct marketer of desktop telephone productivity tools, today announced it has signed a definitive agreement to acquire privately held PhoneZone.com, which publishes a widely respected web buyers guide covering telecommunications and networking products and services. The terms of the agreement were not disclosed.
PhoneZone.com, founded in 1996 and an emerging authority on the convergence of Internet and telecom technologies, is an influential source of comparative research, analysis, and purchase information on telecom and networking solutions for small and medium-size companies. The site serves a growing number of regular business end users who have virtually no alternative single point of contact for conveniently researching, comparing, and buying such a wide range of telecom solutions.
According to Alec Glover, Hello Direct's chief executive officer, more aggressive Internet channel development is one of the key elements in Hello Direct's growth strategy. "The Internet is our most exciting and fastest growing channel, already approaching 10% of our total quarterly revenue and growing at more than a doubling rate year on year in 1998. This acquisition positions us to dramatically accelerate our electronic commerce initiative and more quickly exploit the Internet's potential to become the ultimate direct marketing channel for Hello Direct. With PhoneZone.com's experienced personnel, cutting-edge technology, and high quality content we can grow from our current position as the leading Internet source for desktop telephony products, to become the leading Internet marketplace for a much broader range of telecom products and services," said Glover.
For the nine months ended September 30, 1998, Hello Direct reported net sales of $51.5 million. PhoneZone.com's revenues for 1998 were approximately $1.2 million. "PhoneZone.com provides small and home office buyers with an easy way to locate, compare and buy telecom products and services, from low cost dial tone to emerging technologies like Internet telephony and next generation PBX's," said Brian McConnell, PhoneZone.com's president and founder. "This is a great example of a vertical portal site which combines navigation with expert information, editorial, comparison tools, and links to distribution and service partners. With the marketing support of an industry leader such as Hello Direct, we will be able to turn one of the best kept secrets on the web into a mainstream marketplace. The possibilities are truly exciting." "There is an excellent fit between our two companies," said Glover. "Hello Direct and PhoneZone.com target the under-served small to medium-size business end-user, and both focus on providing outstanding customer guidance and service in addition to selling superior product solutions. Most importantly, both companies have highly complementary visions and strategies for ultimately developing the pre-eminent Internet marketplace for telecommunications."
About Hello Direct, Inc.:
Hello Direct, Inc. is the leading developer and direct marketer of telephone productivity tools including headsets, teleconferencing, wireless and related desktop products. Through its distinctive catalogs, Web site (www.hellodirect.com) and outbound telemarketing programs, the Company offers a broad selection of commercial-grade, brand name, proprietary and private label products at competitive prices that provide solutions to its customers' evolving communication needs.
About PhoneZone.com, Inc.:
PhoneZone.com is an industry-leading authority on telecommunications products and services. The PhoneZone.com Website (www.phonezone.com) simplifies the task of learning about and purchasing a wide range of telecommunications solutions.
This release contains forward-looking statements including, but not limited to, statements regarding the growth rate of the Company's Internet channel, the acceleration of the Company's electronic commerce initiative, the growth of the Company into the leading Internet marketplace for a much broader range of telecom products and services, and creation of a unique portal site. These forward-looking statements involve risks and uncertainties that could cause actual results to differ, and such differences could be material. Such risks and uncertainties include, but are not limited to the difficulties in the assimilation and integration of operations, personnel, and technologies products of acquired companies, and risks associated with the Internet and electronic commerce in particular, which is a new emerging market. There can be no assurance that the Company will be successful in addressing such risks and uncertainties. Investors are strongly encouraged to review the section entitled "Factors affecting operating results and market price of stock" in the Company's annual report on Form 10-K for the year ended December 31, 1997, and quarterly reports on Form 10-Q on file with the Securities and Exchange Commission for a discussion of risks and uncertainties that could affect operating results and the market price of the Company's stock. SOURCE Hello Direct, Inc.
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