UNDER THE RADAR/John Hamill Vennetics:PARENTS NO longer shout at their kids to get off the phone, mainly because instead of charging on the basis of call duration multiplied by a tariff, service providers now usually charge a flat rate for access – with additional services costing extra.
Increasingly it’s the same with mobile broadband access. When the big service providers introduced it in Britain in 2007, they were typically charging £25 a month; less than three years later they’re charging just £5.
“That fall in the value of access is not the only problem for mobile operators,” says John Hamill (35), founder of mobile solutions company Vennetics, which aims to help mobile operators differentiate their services from those of their competitors.
“They’re also struggling with the fact that while people who buy their mobile handsets also use their voicemail and other services – that’s by no means the case in the internet space.
“What happens, essentially, is that customers get cheap internet access from their mobile operators and then buy all the fancy additional services from companies such as Apple, Google and Microsoft.
“So the big challenge for mobile operators is to find a way to compete with those companies on the PC screen. If they can’t do that they face being regarded as utilities – the gas and electricity companies of the internet – rather than as service providers.
“In the same way that Steve Jobs talks every year about Apple’s fantastic new services and people throw money at him, Vodafone, O2 and Orange would like to be the guys providing the sexy services that customers pay a premium for – whereas at the moment all they’re getting is their €5 for internet access.”
That’s where Vennetics comes in, providing VoIP (voice-over-internet protocol) services which allow mobile operators to extend their “service footprint” for the first time on to the PC screen, differentiating the operators’ services, driving average revenue per user (ARPU) and reducing customer churn.
It launched its flagship product, the J-Box, last February, and currently has it on trial with four global mobile operators. They hope to sign an exclusive deal with one of them in the next few months.
“Essentially, the J-Box platform is installed on the operator’s network and allows the operator to provide better, more-integrated IP and mobile services. The key element is free Skype-style calls from your PC, with the difference that if you experience jittery quality you simply click an icon on your screen and the call moves seamlessly to your mobile phone – without the person at the other end realising anything has changed.”
There are also other voice, messaging and media elements, including conferencing and, for example, “multi-ring”, which means that when someone dials your number both your mobile phone and your PC ring, allowing you, if you’re in a hotel abroad for instance, to answer on your PC and avoid roaming charges.
Vennetics was set up by Hamill and his business partner, John Barron, in 2007.
They invested €100,000, which was matched by Enterprise Ireland, and then added grant aid of €130,000 from the InterTradeIreland’s Innova RD fund. The plan is to add venture capital funding next year – after they’ve signed their first customer.
Single-handedly, that anchor client will suddenly turn this fledgling business into an internet company of some substance.
“At the moment our turnover is based more or less on consultancy work of around €50,000 a year. But we’re projecting turnover of around €5 million for 2011 based on doing that first deal.
“If, for example, the client were Vodafone UK, they have more than a million mobile broadband customers and we aim to charge them between €3 and €5 a year per subscriber, all repeatable revenue.
“And our next product is already in gestation…”
ON THE RECORD
Name: John Hamill.
Company: Vennetics
www.vennetics.com
Job: founder.
Background: Graduated in 1995 from Queen's University Belfast with a BSc in computer science, as part of which he spent a placement year developing role-playing game software for IBM AS400 mainframes.
Joined Aldiscon as a software engineer, moving to Apion in 1997 and opening its Dublin office. Subsequently vice-president for market development with Accuris Networks, before founding Vennetics towards the end of 2007 with the support of Enterprise Ireland and InterTradeIreland funding.
Launched flagship J-Box product in February 2009, and now forecasting turnover of about €5 million for 2011.
Challenges: "When you look at PC-based services, there's a strong tendency to offer things for free, so-called 'freemium' services. We have to be very disciplined and focus on services people will pay cash money for."
Inspired by: "My wife, Marie, and kids, Aideen (5), Dermot (2) and nine-month-old twins Erin and Cara. It's very easy to get carried away when you're focused on working hard, going to conferences and building a business, but my family keep my feet on the ground. And on the occasions when I look after the four kids, I realise what hard work really is."
Most important thing learned so far: "This industry isn't as big as you think and Dublin certainly isn't a very big town, so it's important to be fair and honest in your dealings. It's in your own interest apart from anything else."
