Tipped by the independent 2/01/2004

........."And so to our traditional "wild card". Pipex Communications, formerly known as GX Networks, is a telecoms company created by one of the entrepreneurs behind Ukbetting, Peter Dubens. It has been assembled from six smaller players. The ambitious company is generating cash for the first time but is still not widely followed in the City. It could be an undiscovered gem".

I guess these cant all be sells, else it would have driven the price down!!

Look like buys to me

Simon - Dont you remember - with this one the price only goes down after a series of large buys !!

Yep Oakapples, silly me :)

from today's Independent...if this doesn't spark renewed interest in Pipex, nothing will!!

The Independent
13 September 2004

THE RISK with a business that has grown through a string of acquisitions is that, when management gets down to the business of integrating them, it will find some nasty surprises lurking in the acquired companies. But there is also the chance that it will find a very pleasant surprise - and that seems to be what has happened at Pipex Communications.

The broadband internet and web-hosting company is being built up by Peter Dubens, whose previous ventures include ukbetting, the sports websites group. Pipex is now one of the five biggest broadband internet service providers in the UK after buying eight companies since 2002. One of its earliest acquisitions, incidentally, came with the UK licence to a part of the broadcasting spectrum. So far, so unexciting. Except that it now seems Pipex owns part of the spectrum which is being used for a nascent wireless broadband technology called WiMax, heralded as the Next Big Thing in the telecoms industry.

WiMax, like its less powerful cousin WiFi, allows computers to make a wireless connection to the local phone network. WiMax is being heavily promoted by the technology giants Intel and Nokia, and, at big industry shows this year, has been talked of as a way for the fixed-line phone companies to fight back against the mobile phone groups. It is too early to say if WiMax will take off, but it is certainly attracting attention in the City and at least one big investment bank is ready to publish a tome in the next few weeks. It could turn out that Pipex is sitting on something rather valuable.

some very recent media coverage on Wi Max

ITU FORESEES WIRE-FREE FUTURE
INFORMATION SOCIETY

Tech Europe
09 September 2004

The Asia-Pacific region passed the symbolic mark of one billion telecommunication users, mobile phones and fixed lines combined in October 2003. Until now, those users that wanted to have high-speed access to the Internet had to have a fixed-line connection. Before the end of this decade, another billion users of information and communication technologies (ICTs) are likely to be added to the regions networks, but the majority of them will be connected using radio-communications. "The fixed-line network is simply growing too slowly to meet the regions burgeoning demand for broadband, especially in rural areas," notes Dr Tim Kelly, Head of ITUs Strategy and Policy Unit. "But todays second-generation cellular mobile networks are not geared up for delivering high-speed Internet access." New portable Internet technologies promise to cut the cords to a wire-free future in which Internet access, for both fixed locations and users on the move, is available everywhere and supplied over the airwaves.

The new systems operate according to the geographical range (short, medium or long) of the radio signals. Short-range technologies, such as Bluetooth, ZigBee and RFID allow low-power connectivity within a range of 30 metres. Medium-range technologies can communicate at least 150 metres from a hotspot (e.g. Wi-Fi, or IEEE 802.11b) and up to several kilometres, depending on environmental and regulatory factors. Finally, long-range technologies such as WiMAX (IEEE 802.16) and IMT-2000 (3G) have ranges that extend up to 50 kilometres from a base station, and provide near-nationwide coverage when offered as a networked service.

"Fixed-line technologies generally offer higher speeds while IMT-2000, also known as 3G mobile phone networks, offer greater mobility. However, there is a wide gap between the two and many see this as the prime market segment for new portable Internet technologies, especially in developing countries", says Dr Taylor Reynolds, one of the authors of the report. While wireless local area networks (WLANs), such as those based on the IEEEs Wi-fi standards, already help plug this gap at the local level, a more significant technological advance is on the horizon with WiMAX (more correctly IEEE 802.16a, WiMAX is short for Wireless Interoperability for Microwave Access; sometimes called "Wi-fis big brother"). These offer connectivity of up to 54 Mbit/s over a range of up to 50 kilometres.

In rural areas, and other parts of the world that have no wired network, WiMAX could be the preferred platform for offering a wide range of voice, data and broadcast services. In the developed world, at least in urbanized areas, portable Internet technologies are likely to be complementary, rather than substitutive, for existing networks. The market is being driven by handset manufacturers keen to add ever more value to portable devices. "Imagine a device that could store all your personal information, such as ID information and entertainment, including favourite music, photos and films. Add voice and video communications, and location-based information, and it becomes a very powerful communication tool," says Ms Lara Srivastava, the lead author of the report. But this will not come without profound implications for society and lifestyles. "A handheld portable device on which the whereabouts of people and objects can be detected instantaneously may be intriguing, but not everyone is willing to make such compromises with their personal privacy", added Dr Kelly.

The portable Internet will be arriving soon and this report will help to quantify the magnitude of the market opportunities and to identify the challenges it brings. In addition to 140 pages of analysis, the report also contains around 60 pages of statistical tables and charts with the latest available data for more than 200 economies worldwide.

For additional information on the report got to: http://www.itu.int/osg/spu/publications/portableinternet/index.html


Affordable high-speed wireless access
The New Straits Times
13 September 2004

AFFORDABLE long-distance, high-speed wireless access for homes and businesses will soon become a reality when Intel Corp rolls out its worldwide interoperability for microwave access, or WiMax chip.

Codenamed Rosedale, the new chip is based on the IEEE 802.16- 2004 standard, and is designed for cost-effective customer premise equipment (CPE) that supports WiMax connectivity. The CPE is placed at home or business premises to transmit and receive wireless broadband signal, providing broadband Internet connectivity at digital subscriber line speed across long distances.

According to Intel Communications Group's executive vice president and general manager Sean Maloney, WiMax will be more superior than wireless fidelity (Wi-Fi).

"WiMax is capable of delivering wireless broadband connectivity up to six miles compared to Wi-Fi's 300-feet radius. With such a range and high throughput, WiMax is capable of delivering backhaul for carrier infrastructure, enterprise campuses and hotspots. It also allows speeds of up to 75 megabits per second," he told the Press in Busan, South Korea, last week.

"We are now sending samples of Rosedale chips to our key customers for testing in their WiMax products," he said, adding that the full live rollout of the chip in product form can be expected in the middle of next year.

To date, more than 150 companies have aligned with Intel to deliver the wireless broadband communications product initiative. These companies, known as Intel Communications Alliance, are developing technologies, components, and products that will provide the landing points and infrastructure for global, wireless, and high- speed communications.

Maloney said Rosedale is built on the fact that computing and communications are converging on wireless broadband platforms and technologies, and that demand will increase for true mobility. He also said broadband technologies such as third-generation, ultra- wide band, Wi- Fi and WiMax will work synergistically to deliver fast communications connectivity.

Intel's Broadband Wireless Group's general manager Scott Richardson, meanwhile, said WiMax will make it possible to build cost-effective, high- speed wireless connections to homes and businesses, be they in urban or rural environments.

"Intel has focused its WiMax chip development efforts on making it easier and more cost-effective for the next generation of computer users to wirelessly access broadband Internet," he said.

Do we think the mm are aware of what is going on with this conpany

Especially as some of their acquisitions incorporate this Wi-Max technology. It all depends really on what percentage the wireless market will be Wi-Max? Sounds exciting, and it shows that their business model is looking to new trends. Once the big US companies start offering this chip in all their computers we should see this grow more rapidly.

How long though before we see results? At least Pipex have their fingers in all the pies!

NJ

nmjnmj,

Forget the big US companies, Intel are doing the on-chip deals with the Taiwanese/Korean/chinese ODM's - it is they who actually make the notebooks - the 'brand' names don't make a single notebook/laptop/pda - they simply put a different chassis and brand name on them!

Just believe these chip deals have already been done by Sean Maloney (a Brit by the way)...when this service hits the uk, it will take it like storm and the roll-out costs are insignficant compared to 3G..

regards to all.

T..

Lemming Investor now tipping this one.......................

Pipex Communications PLC (PXC)


Elric Lloyd-Langton

September 11 2004

Pipex communications, (7.50p) a quality alternative communications company, in a growing sector; broadband internet access, web hosting, and domain name registration. Formerly known as GX networks, the enlarged group has grown from a minor player in the telecom sector through acquiring no fewer than six competitors in the last 18 months; Pipex in October 2003 and Host Europe in April this year. Pipex are sitting pretty as the UK's 5th largest broadband internet access provider, a position the company strengthened with the acquisition of AccentUK for 12.9 m best known for its Nildram brand, which brought with it 35,000 higher-margin business clients, boosting Pipex customer base to 170,000 up to August, as well as the small matter of 14m revenues Nildram adds to the coffers, there are additional benefit of greater exposure to high end broadband business. It should be noted that AccentUK is already profitable.

As the share price indicates, the city has not yet woken up to what is happening at Pipex, currently trading on a 2005 PE of 14x, which represents 40% discount to the European ISP sector. The PE is expected to fall to 9.8 by 2006 as estimated earnings to rise to 155.8m, from estimated 133.4m in 2005.

Investors may be wondering why the share price has not improved on a par with the groups progress, look no further than a prospect of a price war among sector rivals, this would have an adverse effect on the groups revenues.

Another factor could have a knock on effect, BT raising its wholesale prices for business IPStream by up to 32%. As PIPEX is a reseller it either has to absorb
these costs its self, or pass them on to clients. absorbing the costs themselves would of course hit group margins.

Services

The company's broadband business accounts for 42% of turnover, estimated to be 48% in 2005, just 10% at the same time last year, adding c2,000 broadband customers each month, even without acquisitions. There are currently 4.4m broadband users and 2.8m DSL and 1.6m cable modem users, estimates expecte broadband users to rise to 6m by 2006 and more than 9m by 2008, even so, this would still leave the UK off the pace with the rest of Europe.

Current revenue mix from these sectors are; broadband 46%; hosting 20% and domain names/security 5%. Gross margins were 46.5% for the half year to June 2004 up 7%
from the same period last year and 3% higher than for the full year 2003. This latter improvement was driven by the increase in hosting (high margin) revenues in the service mix following the acquisition of Host Europe.

Once you strip away acquisitions organic growth accounts for a healthy 14% on top of acquired revenues. The fastest growing parts of the market are broadband, shared hosting and domain name registration where we have strong market positions in the UK; broadband number 5; SME hosting number 1 and UK domain names number 1.

Voice over Internet Protocol (VoIP) technology enables users to bypass the traditional telephone exchange and make calls over the internet for next to nothing. The group is preparing to launch its first VoIP product later this year.

Pipexs most interesting development yet, WiMax; wireless internet technology to the next level. It will enable the user to access broadband internet anywhere within a 50km radius of an aerial, and 30km in built-up areas. Pipex is one of only two companies who have been granted a license to sell Wimax in the UK. They expect to start developing the product next year, once Intel has developed the necessary chip.

Finances

The pick up in demand for broadband has propelled Pipex to profitability for the first time in H1 as demand for broadband internet access continued to strengthen, with revenues soaring from just 11.1m last year, to 43.6m, earnings buzzed at 4.9m before interest, tax, depreciation and amortisation, up from a loss of 1.9m in the first half of 2003. The groups gross margins are 46.5%, which should further boost the coffers as the group increases efficiency across its business model.

Strategy

The groups strategy of bundling broadband services, along with the scope for cross selling group products to existing clients., focusing on its on two of the strongest
growth opportunities in the UK market. Broadband ISP and webhosting.


PXC

MK 172m

cheers Gf.

Better not tell anyone but Pipex has gone blue

Sean Maloney? Is that the wee dwarf that plays for Celtic, haha

MMs maybe short of stock....just been quoted 7.75p to sell 250,000

could be a BIG buyer has emerged given these bargain basement prices!

Need to sit down. the shock !

Troys,

this is only the beginning!

The beginning of what ? the end ?....
Seriously though, what can we expect over the next couple of weeks ?

skyhigh,

from a charting perspective I really would like to see a breakout above 9p within the next couple of weeks...

at this level we would have a much better platform for lift off towards Collins Stewart short term target of 14p

Lets all hope this is the move north that we all been waiting for.

I am Still tempted to top up.

I still find this a worrying stock. It was not too long ago it was 12p and since then we have had much good news................hence the 7.75 price now!!
I like most believe this is an aggressive well run business but I cant explain the share price performance which in the short term does not worry me, but it has now underperformed for quite a while.Regretably can state several poor share performances from excellent performing companies(eg CYH,ERT)At what stage do you move your money to a share that the city does like?
Not wishing to sound pessimistic but I cant see the point in waiting forever....lets face it you get 5% in the building soceities! - although not as exciting.

willfagg

Well said I totally agree.

MS