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TWST: What role will mergers and acquisitions play in the communications market and industry today?

Mr. Kits van Heyningen: At this time, we (Nasdaq:KVHI) have a solid portfolio of technology in the communications market that we’re addressing. The industry that we specifically target isn’t really a consolidation play, as there aren’t a lot of small players who could be rolled up. From where I sit, we have a clear vision of what needs to happen. We’ve also got the skills and the technology in-house to make it happen. I believe mergers and acquisitions won’t play a big part in our future or, really, in the industry that we’re playing in.

TWST: How international is the business today and how do you see that international aspect versus the domestic markets changing or growing?

Mr. Kits van Heyningen: The export market always comprises a very large part of our business. We’ve had some years where exports delivered between 50% and 70% of our revenue, and we’ll always be an international company. We have a subsidiary in Denmark that addresses the European market and, as I just mentioned, we’re introducing some new products into the European land mobile satellite market. So we see exports continuing to play a very large role in the general markets that we’re in. The satellite communications market is actually larger internationally than it is domestically. That’s because the wired infrastructure in the United States has always been pervasive versus some of the foreign markets, so their switch to wireless and satellite is actually occurring faster than ours. Another example of that is satellite television in the United States. We have about 10 million television subscribers for satellite and 60 million for cable. In Europe, it’s the other way around. They’ve got about 60 million satellite television subscribers and only about 10 million for cable. So we see the international market being extremely important, and we’re pushing into that area.

TWST: At this point, how could the investment community better understand KVH?

Mr. Kits van Heyningen: Our company has evolved quite a bit. A few years ago, a big part of our business was with one or two large OEM customers. Today, KVH branded communications products like TracVision and Tracphone, which were 1% of our business three years ago, are now over 70% of our business. We’ve achieved a very strong transition from a component and OEM supplier with a few customers to a complete turn-key systems player in the satellite communications field. So we’ve really transformed the company in that respect. This transition was achieved through significant investments in new products, market development and infrastructure over the last two years. Now KVH is beginning to see the benefits of those investments and strategic choices. And that’s very positive for us in the long term.

TWST: Are there thoughts or issues you normally would focus on that we have not covered?

Mr. Kits van Heyningen: We talked about our major products and markets. I think some of the technology trends are probably something that we should spend a minute on. Technology has played an important role in making satellites much more popular as a mechanism for delivering digital television. Internationally, the satellite television industry has been very successful. The digital revolution for satellite Internet is also coming, but it hasn’t happened yet. While very few people now get high-speed Internet access via satellite, new satellites that are being launched in the second half of 2000 have capabilities that will provide dramatic improvements in delivery. From a technology point of view, such a capability is a fundamental shift.