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Eller Industries QENEX® division deploys a wireless
infrastructure and backend infrastructure
to local wireless internet service providers
Eller Industries, Inc.
1630 Main Street-Suite #202
Longmont, Colorado 80501
Chief Executive Officer
Interview conducted by:
Lynn Fosse, Senior Editor
April 21, 2005
Eller Industries, Inc.(ELRI) is committed to delivering Advanced Technology, Effective
Business Models, and Unique Markets.
QENEX® has developed an exclusive relationship with Softhill and Tetrasoft, the designers
and marketers of the BriLAN Network Management System and the modular wireless channel
electronics package used in the QENEX® implementation. Along with the Softhill design,
QENEX® integrated other proprietary systems features that have extended todays
QENEX® 802.11b product distance performance that the new WiMAX 802.16 standard hopes to
achieve later on in 2005.
Effective Business Models
QENEX® is being embraced by smaller businesses, globally, as their local wireless
solution to the last-mile connectivity problems that exist today.
The last-mile and rural markets, that the QENEX® technology specifically addresses, opens
unique opportunities, globally, for volume production.
CEOCFOinterviews: Mr. Olson, will you tell us about your
background with Eller?
Mr. Olson: I have been in management with Eller
officially since October 1, 2004. Prior to that, I was a limited investor in the company
and had a history of running some other companies.
you tell us about Eller Industries and the service it provides?
Mr. Olson: Eller Industries, as it has been reorganized
now, is a company with a division called QENEX®. The QENEX® division is currently
working on wireless infrastructure deployment. We have developed the wireless
infrastructure to provide to local wireless internet service providers. We have all of the
equipment and the technical background available for someone to get into the business of
being a local area wireless provider without all of the normal start-up costs and
headaches of going into everything. We have it on a turnkey basis.
they getting equipment from you, or are you hosting for them?
Mr. Olson: We provide equipment on a basis of revenue
sharing, so when they go out in their local area and gather customers to get them
signed-up, we are providing broadband wireless internet, voice-over IP, and some other
types of ancillary products. The majority of that is provided by us. We do all of the
network monitoring and the billing system, so they do not have to have huge billing
departments. We also provide the backend infrastructure for them so that they can spend
their time on business development and acquiring and installing and servicing customers.
you active with this now or is this something that you are starting to roll-out.?
Mr. Olson: The technology was developed by one of our
founders over a period of a number of years and he brought me into the business side of
everything last summer. There were some small corporate issues that were not handled very
appropriately; no illegalities, but from a business standpoint they had some problems with
past management. So we spent some time cleaning up all of that and making everything ready
to go and now everything is in-place. Our development team came in, in October of 2004. We
are fully developed and have now deployed through a QENEXion Specialist in our local area.
We have a company called Gonzo Access that has become the local area wireless internet
service provider and he is actually up and serving customers. We are working with a number
of potential connection specialists to become their own WISPs in their own areas. We have
interest from all over the country and internationally as well.
is your marketing strategy?
Mr. Olson: We market through a network of people that
we know are interested in that type of business, and being in that type of business. The
wireless industry is widely talked about. We have had a number of people find us just
through our website and through other people that they know. For the most part, a lot of
it so far has been word-of-mouth and industry knowledge.
you tell us about the wireless internet industry and the part you are playing?
Mr. Olson: Today, broadband is becoming a bigger and
bigger piece of our economy. Both business and residential users are in need for more
broadband capabilities. DSL and cable have been the primary efforts to get broadband
services to the public. There are a huge number of areas in which fiber, cable or
telephone lines just do not reach far enough to service everybody. We are able to reach
anybody anywhere because we are using wireless technology. Our best avenue of doing that
at this point in our marketing strategy with our connection specialists is to go to rural
areas and areas that are underserved or not served at all by DSL or cable. I believe that
there are huge numbers inside of the United States that are underserved. DSL technology,
even though it is through telecom companies, only reaches certain distances and is only
available if the correct type of switching equipment is in-place.
is the competition like?
Mr. Olson: Any broadband provider is in essence
competition to us. Our goals are to reach the outer underserved areas. If I do not have a
DSL or cable company in the local area, obviously I do not have them as competitors.
Satellite is still a possibility, although we believe our technology is more
cost-effective for the customer and for us to deploy. They do not have to pay for a big or
small satellite dish to be put on their house in order for it to be taken care of. We have
a small six-by-six inch box that goes on the end users facility, whether it is a
house or an office building. That is all there is to it. It is non-intrusive and cheaply
installed. The service that we are able to provide is affordable and very reliable. There
are other wireless entities that are coming out but we believe our technology is superior.
It is a proprietary system and we have applied for a patent.
you tell us about the financial picture?
Mr. Olson: We have put out a press release but we have
used some internal people to fund a little bit to begin with. We raised about $750
thousand in the fall and it has been announced. We are going through that as carefully as
we can and we now have revenue starting and we hope to raise more capital as we go
forward. We have a number of prospects for funding that are very good and we think we have
wisely used the money that we raised in the fall.
closing, what would you like to say to potential investors and what should they know that
they might not realize when they first look at the company?
Mr. Olson: We are in a market that is going to grow by
leaps and bounds. We are a relatively small company at this point, but part of our
advantage of being a small company now is being able to change direction or implement new
technology as we are going along, unlike some of the larger companies where it takes a
major shift to do something. We have a huge marketplace in front of us that is underserved
and we have a business model. We do not have to implement every area. The connection
specialists are in that area to do the marketing and servicing so that they will have
their own capital that they are deploying, which means that I do not have to spend that
money to grow quickly. We think that once everything is running efficiently, that the
margins will be high in this business.
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