Thursday, March 18, 2010

MLabs targets 50% video conferencing market share

KUALA LUMPUR: ACE Market-listed MLABS SYSTEMS BHD is targeting to increase its share of the local video conferencing market to 50% in the next five years from 30% at present.

The company, which manufactures both the hardware and software for video conferencing TECHNOLOGY , said it would use proceeds from its latest rights issuance for sales and marketing of its video conferencing system, hardware purchases and for the "expansion" of personnel. MLabs shareholders approved yesterday the company's proposed renounceable rights issue of 51.48 million shares together with 77.22 million free detachable warrants on the basis of two rights shares and three warrants for every four existing shares. The rights shares are priced at 10 sen apiece while the indicative price of the warrants is also 10 sen each.

MLabs executive director Ismail Ahmad said the company would focus its marketing efforts on government agencies as well as the business community. "We are in talks with some of these parties. We are confident in sealing more deals, especially with the government agencies," Ismail told The Edge Financial Daily today.

He added that the company had in previous months sealed deals with some government agencies like the Prisons Department to install such systems.

MLabs partners Universiti Sains Malaysia for the research and development (R&D) of its video conferencing products.

"We are currently developing high-definition and telepresence video conferencing technology. We hope to introduce it at half the price — below RM50,000 — offered by well-known competitors," MLabs R&D chief Prof R Sureswaran said.

"We actually have a prototype unit — the software portion of it. And we're trying to get hardware to support the software now. We expect to be able to release working units by the end of the year."

The company said its biggest competitive advantage was its lower set-up costs.

According to a Bursa Malaysia filing, MLabs' net loss narrowed to RM791,000 in the year ended Dec 31, 2009 from a net loss of RM6.88 million in 2008. Revenue increased to RM2.87 million from RM1.41 million.

(Source - MLabs targets 50% video conferencing market share)