Wednesday, July 9, 2008

Elephant Talk Communications Inc. (OTC BB: ETAK)

JUNE 24, 2008 TARGET PRICE: $2.40 RATING: SPECULATIVE BUY

COMPANY OVERVIEW

ETAK has developed a unique business model as a global network systems integrator. This enables thousands of smaller, niche (virtual) telecom companies to leverage ETAK’s network and resources and brand them as their own. The Company provides a full range of telecom products and services, which are uniquely designed to fit its customers’ major business processes and delivered through ETAK’s streamlined distribution network with its proprietary software and systems. This serves to eliminate the obstacles that typically occur from national borders, networks, devices, or media.

ETAK delivers a 100% turnkey telecom platform that enables clients with brand equity and marketing expertise to focus on selling instead of network build-out. As opposed to most telecom providers, ETAK’s client base is comprised of businesses that provide a significantly more stable underlying subscriber base than a consumerbased revenue profile. ETAK’s clients and revenue base represent significantly lower churn, higher average revenue per user (ARPU), and greater predictability due to the unique provider-client relationship ETAK enjoys with its revenue base.

ETAK represents the next generation of MVNEs that will dominate the competitive landscape. First generation MVNEs (Mobile Virtual Network Enablers) have traditionally faired very poorly in the market due to their inability to compete directly with carriers for both MVNOs (Mobile Virtual Network Operators) and consumers at the same time. MVNOs like Helio, Virgin Mobile, and Disney/ ESPN have failed at winning the war for consumer top-of-mind awareness with competitors like Verizon, AT&T, Sprint, DT, and Vodafone who collectively have billions of dollars in their marketing budgets. ETAK’s business model does not rely on revenues from wireless to cover operational costs; it is self-sustaining from legacy operations revenue. Additionally, ETAK’s client base markets to consumers based on niche brand equity or market segment strengths—this eliminates the largest risk/exposure in vying for “commodity” telecom consumers.

Wireless telecom resale and mobile Internet access are set to explode over the next two years. Higher bandwidth capabilities of third and fourth generation wireless networks are enabling progressively higher functionality and product/service delivery for niche wireless telecom players. The cost of building network access capability and management tools is prohibitively expensive. ETAK offers a superior network to deliver rich media, digital content, and third-party applications across the full spectrum of mobile users, allowing its clients to truncate the time-to-market delays typical of large carrier deployments.

For a complete report: click here

About RedChip Companies, Inc.

RedChip Companies is an international, small-cap research and financial public relations firm with offices in Maitland, Florida; Bangalore, India; and Beijing, with affiliates in New York and San Diego. RedChip delivers concrete, measurable results for its clients through its extensive national and international network of small-cap institutional and retail investors. RedChip has developed the most comprehensive platform of products and services for small-cap companies, including: RedChip Research™, Traditional Investor Relations, Digital Investor Relations, Institutional and Retail Conferences, RedChip Internet TV™, and RedChip Radio™. To learn more about RedChip's products and services please visit: www.RedChip.com

RedChip Companies, Inc. 500 Winderley Place, Suite 100, Maitland, FL 32751 1-800-RedChip www.RedChip.com

No comments: