Article Excerpt:
TWST: What is Sangoma Technologies?Mr. Mandelstam: Sangoma Technologies is a company that has been involved in data and voice transport since the mid-1980s. In the year 2000, we were acquired in a reverse takeover by a public Canadian company, and we are currently traded on the TSX Venture exchange under the symbol STC or STC.V. About two and a half years ago we transitioned from doing data-only transport such as wide area routing and protocol conversion to including voice in the mix, supporting VoIP systems. Voice has become an important part of our business and it has a high growth rate. Our technology is all PC-based, and we generally use the same technology for both voice and data. Our product range consists of cards that are installed in PCs, together with software drivers to make them work. The cards provide interfaces to wide area data networks, and can also function as standard telephone interfaces for voice. We do provide some products that are specifically designed for voice applications. Our primary customers are OEM manufacturers or VARs that use our cards to support their own or proprietary applications or open source applications.
TWST: Give us an idea what the markets, the dynamics of competition, and the
dynamics of the client space are like today. What are some of the key trends or
issues that you feel are having an impact?
Mr. Mandelstam: What we see is that there is a strong burgeoning movement to
make use of PCs as telephony products. They have always been used for data
handling, but just recently it has been recognized that because of their power,
they could be used to handle voice - ordinary telephony voice. In fact, this
interview is being conducted using a quite ordinary low-end PC using some of our
products and an open source telephony application. The PC-based PBX uses Voice
over IP (VoIP) on the office side, and standard telephone interfaces using
Sangoma products on the telephone network side.
Until the last three or four years, PCs weren't powerful enough to do this
because voice is a very demanding application. But as PC power has increased
according to Moore's Law, it is now possible to produce large powerful telephony
platforms based on the PC. While VoIP is a technology with tremendous potential,
there is still a requirement to be able to connect systems to the old standard
telephone network. We support the standard telephone connectivity using our PC
cards. That has been a great market for us. We have been seeing growth rates in
that market in the double digits quarter-over-quarter, and the voice business
has grown to be a significant portion of the total business that we do.
At the same time, our traditional data business has been improving as the
network recession has come to an end.
So things are pretty exciting for us. The voice market is so huge that at our
company size it looks infinite. There is room for us to grow for decades without
really touching sides, even at our current spectacular growth rates.
Tickers included in this excerpt: CRDS, STC:TSX.V
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