Alternet Systems, Inc. (ALYI) Letter to Shareholder Highlights Mobile Payments Subsidiary Operational Accomplishments and Regional Leadership
MIAMI, FL, Nov 14, 2012 (MARKETWIRE via COMTEX) --
Alternet Systems, Inc. (OTCQB: ALYI) today released a letter to
shareholders from company CEO Henryk Dabrowski. The letter highlights
the operational accomplishments and leadership position of its mobile
payments subsidiary, Utiba Americas. The letter is included in its
Dear Fellow Shareholders,
This letter is a follow up to our third quarter filing posted with
the SEC on November 14th, which accurately depicts our financial
performance for the period, but does not yet reflect important
operational advances made during the first three quarters of the
year. Specifically, in 2012, Alternet's mobile financial services
subsidiary, Utiba Americas, has sold and deployed services in six
countries of Latin America, making it the leading technology provider
in the region with an estimated 35% market share of the deployments
in these markets.
Since its launch in early 2010, Utiba Americas
has rapidly assumed a leadership role in the emerging market of
mobile payments of Latin America. The evolving regulatory environment
in South and Central America has at times complicated the sale and
launch of services. Despite this challenge, Utiba Americas has sold
the Utiba Mobility platform to financial institutions and mobile
network operators throughout the region and has deployed services in
Bolivia, Colombia, Ecuador, Guatemala, Honduras and Venezuela.
Utiba's customers in these countries target a total of 120 million
Bolivia. As recently announced by Utiba, Bolivia's largest bank and
regional leader in micro-finance, Banco FIE, has selected Utiba's
Software as a Service (Saas) solution. This project is in
implementation. Additionally, the Utiba platform has been deployed in
the networks of the country's two largest providers of mobile
communications, who have yet to launch services.
Colombia. Utiba's platform has been deployed and is in use by one of
the country's leading mobile communications providers. The platform
is also being used in a pilot distributing government benefits
(welfare payments), orchestrated by one of the country's leading
business to business (B2B) technology providers.
Ecuador. In 2011 Utiba Americas won the public bid for the Central
Bank of Ecuador mobile payments project pilot. The Bank has yet to
select a provider for the full scale deployment, though a public bid
is expected in the coming quarter.
Guatemala. In late 2011, Utiba Americas' hosted Mobile Financial
Service platform was selected by Guatemala's largest bank and one of
Central America's largest mobile operators to launch and manage an
innovative mobile payment service. Since its soft launch at the end
of 2011, the service has been expanded to include payroll services,
bill payments, government subsidies and mobile remittance. The
service has experienced a significant increase in adoption in the
summer of 2012.
Honduras. In early 2013, a new mobile payment service provider will
convert its current pilot, running on the hosted Utiba Americas
platform, into a commercial service, offering third party bank branch
services, business to business mobile collections, bill payment and
Venezuela. In 2011, Utiba Americas sold and deployed its electronic
recharge (top-up) platform for a Venezuelan mobile network operator,
which will in 2013 expand the platform's services to include mobile
commerce. Utiba Americas expects to launch additional projects in the
Venezuelan market in coming months, which will include the use of a
companion card tied to the mobile wallet, an important element of
Utiba's Converging Payments Strategy.
Regional Deployments. Regional third party payments provider Movilway
continues to deploy the Utiba electronic recharge (topup) platform
throughout its distribution network in the Central and South American
region. Movilway is currently in 12 countries with more than 80,000
Utiba Americas expects to announce new regional contracts before the
end of 2012 that will potentially expand its Mobile Financial
Services platform to another 27 countries across the
In the coming quarter, both Utiba and Utiba
Americas will announce a number of strategic partnerships with
companies with complementary product offerings. Pending agreements
include an important regional channel partnership and a complementary
suite of business analytics tools for microfinance, credit
assessment, and mobile retail purchases.
Already announced in this year are agreements with i2c, Inc.,
Validsoft, and Spindle, which provide access to open loop payment
processing, advanced mobile transaction authentication services, and
a low cost acceptance network, respectively, and build upon Utiba's
participation in the MasterCard Mobile Money Partnership Program
announced in February.
On a separate note, one which augurs well for future success, Utiba
Americas and Utiba continue to strengthen and broaden their
relationship. The two companies are dedicated to making the Utiba
brand and its products the preferred global solution. To that end,
both entities leverage each other's capabilities and relationships
and management are in constant contact to ensure seamless and timely
product delivery and success.
Revenue Recognition and Accrual
As discussed in earlier shareholder
communications, all of Alternet's revenues currently come from our
mobile payments subsidiary, Utiba Americas, which has been changing
its product mix from a traditional software license toward the sale
of software as a service (SaaS), or from a one time revenue event to
a monthly recurring revenue stream over a period of years. This shift
is in keeping with industry trends towards the use of cloud computing
and based upon an evaluation of customer needs. This shift also
results in a delay in recognizing revenues and per accounting
practice, accrual only of the revenues billed in a given period.
As a result, the value of Utiba Americas' multi-year agreements is
not evident in our financial statements, as we are only able to bill
for services when the project has been delivered, and monthly
services fees are billed and booked for the period.
International Mobile Security (IMS) -- Cyber Security Subsidiary
IMS' strategic partnership and reseller agreement with UK based Delma
Technologies has effectively increased the company's international
sales force and given IMS access to Delma's products and resources.
Based upon the early success of this relationship and complementary
nature of the two companies' technologies and services, we have begun
exploring additional joint efforts, to include software development
and combined delivery and support efforts. We expect these efforts to
permit a timelier closing of opportunities, which has caused a delay
in reporting revenues at the subsidiary.
I am proud of
the accomplishments of Alternet and its subsidiaries, in particular
of the leadership position achieved by Utiba Americas. When we began
marketing the Utiba Mobility platform in early 2010, we knew we had
chosen to partner with the best technology provider, and we correctly
anticipated that mobile financial services in Latin America would
evolve differently than in Asia- Pacific and Africa, where the
majority of the worlds' deployments had taken place previously. We
quickly determined that the regulators of the region would favor
financial institutions, and that financial institutions in turn would
view a mobile payment platform differently than a mobile network
operator, and would welcome the software as a service (SaaS) business
model. This product development has been positively received in Latin
America and elsewhere; in fact, we expect to announce global SaaS
clients for Utiba Americas in the coming quarter.
This type of product innovation is an indication of the excellent
business development and technical team we have assembled here in
Miami. With this talent, we expect to lead the industry for years to
I would like to extend my thanks to Alternet's personnel and that of
our subsidiaries for the hard work during this important year, and to
our shareholders for their continued support.
About Alternet Systems Inc.
Alternet Systems Inc. (OTCQB: ALYI), a
US corporation headquartered in Miami, Florida, is an investment
holding company focused on the complimentary, high-growth markets of
cyber-security and mobile financial services. Through its
subsidiaries, Alternet captures and converts the extraordinary growth
and opportunities surrounding the explosion of mobile phones
worldwide. Its cyber-security subsidiary, International Mobile
Security (IMS), provides mobile and digital security solutions to law
enforcement agencies. Alternet's mobile financial services
subsidiary, Utiba Americas, is a joint venture with Utiba Pte, the
leading developer of mobile payment software solutions. Utiba
Americas is deploying mobile financial services solutions for mobile
network operators, financial institutions and third party payment
service providers throughout the Americas region. More information
about Alternet and its subsidiaries can be found at
www.alternetsystems.com and by following the company on Twitter
"SAFE HARBOR STATEMENT" UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
Certain statements in this news release may
contain forward-looking information within the meaning of Rule 175
under the Securities Act of 1933 and Rule 3b-6 under the Securities
Exchange Act of 1934, and are subject to the safe harbor created by
those rules. All statements, other than statements of fact, included
in this release, including, without limitation, statements regarding
potential future plans and objectives of the Company, are
forward-looking statements that involve risks and uncertainties.
There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ materially
from those anticipated in such statements.
Media Contact at Alternet:
Investor Relations Contact at Alternet:
SOURCE: Alternet Systems, Inc.
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