By Ian Kehoe, 19 July 2009, Sunday Business Post

Mobile phones on aircraft? Check. Broadband for ocean liners? Check. Blackberries on oil rigs? Check. Now Mike Fitzgerald, the Kerry entrepreneur whose company first enabled in-flight mobile phone usage on commercial planes, is turning his attention to some of the most remote villages in the world.

His company, Altobridge, has spent the past seven years developing and refining a pioneering technology that slashes the cost of providing mobile phone coverage in far flung, isolated locations.

Fitzgerald said the technology was ready to go. ‘‘The hard part is over. Our engineers have developed a software that works. The next step is to get it out there,” said Fitzgerald, who established the company in late 2002. His new target market is the one that most operators have left behind – small villages of between 200 and 500 people in distant locations where it makes little financial sense for a telecoms operator to build masts or install expensive telecoms infrastructure. He estimates that more than one billion people in the world live in areas without phone coverage.

By using Altobridge’s technology, Fitzgerald said, it was now economically viable for mobile phone operators to enter these virgin territories. Altobridge’s technology is complex, and involves creating a local mobile network off a base station connected to a satellite.

Fitzgerald said the company had registered s ix international patents.

The business case, however, is much simpler. ‘‘We can look our customers in the eye and tell them we can cut the cost of delivering wireless communications. It is a compelling proposition,” he said.

Fitzgerald knows a thing or two about compelling propositions. Although only in his early 40s, he has been in the telecoms business for more than 20 years, rising to become vice president of two Nasdaq quoted companies.

In 1999, he led a management buyout of a division of a US company to form Microcellular Systems, before flipping it on a year later for $20 million after returning it to profitability.

After spending millions of euro on research and development for his latest venture, Fitzgerald said that Altobridge had been profitable in the last quarter, while its order book and turnover were both expanding quickly.

‘‘I don’t think anyone is recessionproof, but we are lucky in that this is our growth year. Typically, you spend a lot of years and a lot of money developing the software. We have done that. Now our job is to start selling it,” he said.

Most of that sales effort will centre around Altobridge’s Malaysian experiment. Two years ago, it entered the Malaysian market through a partnership deal with Maxis, the Asian mobile phone operator, whereby it agreed to develop, deploy and manage a remote mobile network.

Altobridge trained local companies to install and manage the base stations – small portable devices that make the technology work.

Fitzgerald said that the overall deal was designed to prove that the technology worked, and that it could work anywhere.

‘‘If you want to get sales in this market, you need a beachhead reference. You have to provide proof that your technology works. Malaysia was our beachhead reference. The market was very remote, but we proved our technology and our business model there.”

According to Fitzgerald, Altobridge is now at varying stages of deploying its technology to a further nine countries.

After Malaysia, he said, the big market was Indonesia, which has a population close to that of the US, spread over 17,000 islands. ‘‘It is a massive market, but a monstrous country for telecommunications. There are so many small villages and towns. We are also working on three countries in South America, and several in Africa,” he said.

The international expansion will require money, however. Additional sales staff will have to be recruited, while capital projects will have to be funded.

The company has received funding from a range of investors including Claret Capital (the investment company headed by Domhnal Slattery), the late Tony Ryan and Shannon Development.

Now Fitzgerald is planning to go back for more. This week, he will begin an investment roadshow in the US, where he aims to tap investors for funding to finance the company’s growth over the next three to five years.

‘‘We are in discussion at the moment. We are not looking for crazy money, and we are conscious that this is 2009. But we think there will be interest. You can never be cocky, but you can be quietly confident,” he said.

Fitzgerald said the company had raised a ‘‘relatively modest’’ amount of funding, allowing senior staff and management to retain a majority stake in the business.

Although it has only one product, Altobridge has two distinct ways of doing business. In certain cases, the company will manage the entire network, as it has done in Malaysia. Fitzgerald said the benefit of this model was that it provided a recurring revenue stream.

In other cases, the company will operate through channels. It has signed licensing deals with two of the largest wireless network providers, including Ericsson. These two deals provided Altobridge with access to almost 80 per cent of the global market, Fitzgerald said.

‘‘In a recession, it is important to have a mixture of business. That is why we sell our software through channels and do managed services. Both are important to us.

‘‘This is not a quick play, a quick sell. It is a long-term business plan,” he said. Down the line, Fitzgerald said, it was possible that Altobridge would decide to spin off one of the two business units in a separate company to allow it to scale up.

It is a model that has worked for the company before. In 2007, its technology formed the basis for Blue Ocean Wireless, an Irish company that provides GSM mobile phone network for merchant ships. Altobridge retained a 15 per cent stake in Blue Ocean, which now has a customer base and order book approaching 700 vessels.

The company is also backed by Claret Capital and Filipino telecoms group Smart Communications. Last week, Blue Ocean announced that it had raised a further $7.5 million in funding, with the equity coming from both Altobridge and Smart Telecommunications. Claret Capital did not participate.

The company is now valued at more than $87 million.

‘‘We have a stake in the sister company, but we really view it as a customer. It is a great source of recurring revenue. It uses our software,” said Fitzgerald. Altobridge is also pushing ahead with its in-flight technology, which offers mobile phone and Blackberry access to airline passengers. It now has deals with seven airlines, including Emirates and Qantas.

(Ryanair selected Altobridge’s main rival as its partner.)

The technology garnered the Kerry company headlines around the world, but, Fitzgerald said, it was always going to be the firm’s secondary market.

‘‘One of the big challenges for an indigenous R&D company is to create a brand. The aircraft market was good to us. It got us attention and it proved that our technology worked. When we sit down with customers, people know who we are,” said Fitzgerald. ‘‘But we need to be able to back it up. If you create hype without credibility, it is a dangerous thing.”

Fitzgerald, who is on the shortlist for this year’s Ernst &Young Entrepreneur of the Year award, is quick to point out this is not a one-man operation. The company’s workforce, he said, probably worked harder than he had to, and was among the best qualified in the country.

He also sings the praises of Enterprise Ireland and Shannon Development. ‘‘There is a great network out there. They can really open doors for you.

Likewise, our ambassadors around the world are great for helping businesses,” he said. He has also started to back fledgling companies, though Mianach Venture Capital, a new funding house backed by Fitzgerald and some other software veterans.

‘‘I think it is good to help grow and scale Irish companies,” he said. ‘‘That is what we are trying to do at Altobridge, and what Mianach is trying to do with other companies.

Irish entrepreneurs have to realise that they don’t have to sell their business when someone waves a few dollars under their nose. Sometimes, you can make more by growing it. That is our strategy with Altobridge.”