Telephone systems service provider Plestel has launched a prospectus for a listing on the ASX in the name of its core brand, Commander. The listing is expected to finance a move into Web hosting and application service provision.
Originally a joint venture between Plessey and Telstra, the company will now be re-named Commander and aims to become an integrated communication service provider to the SME market and branches of large corporations.
The Commander brand name is widely recognised in the telephony market and will now be badged on a wide variety of voice and data products, which the company will market through reseller agreements. The company holds exclusive rights to distribute products developed by 3Com, Lake Communications, Nortel Networks and Siemens.
These reseller relationships include a six-month preview into research and development facilities at the headquarters of the vendors, to get advanced notice of product development. A three-month preview agreement is also held with Telstra, for the telephony products Commander continues to resell. Commander managing director John Dougall places great emphasis on these non-disclosure-covered previews in keeping the company ahead of the market.
"We get the full benefits of the R&D process without the R&D costs," he said. "These agreements are usually negotiated at the board level of the parent company, rather than its regional office."
Considering the high margins, low risks and existing customer relationships of Commander's voice business, it could be said that a move into Web-hosting services involves a degree of risk. But according to Dougall, the preparations are in place to make a data business that matches the existing voice business.
A large portion of the capital raised through the IPO will go into funding the Web-hosting move, with the company already acquiring a Web-hosting company in both Sydney and Melbourne. Commander has also hired the talents of Dean Gingell, formerly of OzEmail and F2, as deputy managing director, to head up the expansion into hosting.
"We already have an established brand, so we don't have to throw money against the wall," said Gingell.
The company plans to use the data management facilities of a partner for several years, under the Commander brand name, until it has enough customers to open its own data centre. It is currently negotiating with a number of parties for the provision of these services, but is remaining tight-lipped about which companies are involved in the discussions. It is expecting to make an announcement on the preferred partner later this year.
Gingell suggests the only competition for Web hosting in the SME market is the likes of WebCentral and Peakhour, but he did not rule out the possibility of either companies being involved in discussions over the partnership arrangement.
"I wouldn't rule out working with either of them," he said. "Our core business is to provide everything for the SME market by re-badging best-of-breed products. So partnering one of these companies would still be consistent with the rest of our business."