Gary and Rahul have demonstrated a business model that is in part based on short-term pain for long term gain i.e. cutting back on the cash-raise early this year - the revamped Tata deal. With that in mind:
- to get the ball rolling with content providers, I would expect the current freeway app Indonesia Beta testing to be subsidised, probably through cheap or no cost data. This would explain some of the name brand apps we have attracted so far
- nominal sign up fees/re-sign fees for carriers
- plus, we must consider possibly even nominal charges to the content providers as well
With the above in mind, I have low revenue expectations short-term.
So why would they do such a thing - this short-term pain for long-term gain? I am now seeing the Syntonic platform evolving into a sponsored/bill paying platform that transcends traditional company rivalries and countries. By way of example, let's assume AT&T does take over Time Warner and adds Game Of Thrones to its content offerings. In the future here are some scenarios that may play out...
- Traditional Company Rivals Scenario: A subscriber to Verizon wants to watch Game Of Thrones - an AT&T show. They download the dedicated HBO white label version of the Freeway App. They can choose to watch it with advertisements/sponsorship. Or or they can choose to be billed for it on their next monthly bill from their telco Verizon - who passes it onto middleman Syntonic - who passes it on to content provider AT&T. In this scenario everyone wins (Verizon makes money by the increased use of data).
- Various Country Scenario: Same as the last scenario except the subscriber is here in Australia and the telco is Telstra. The end user cannot afford Foxtel so instead downloads the dedicated HBO white label version of Freeway App. Again, Syntonic is the middleman between Telstra and AT&T. This scenario can be applied to countries around the world.
In these above scenarios Syntonic stand to make a lot of money as the middleman - such is the flexibility of the Syntonic platform.
Just another reason why I am very bullish about Syntonic long-term.
Dyor.
SYT Price at posting:
3.9¢ Sentiment: Buy Disclosure: Held
