Carlson Wireless Technologies - Gen 3 TV White Space Radio, RuralConnect

Copyright 2015 Carlson Wireless Technologies Inc. 1

Jim Carlson, CEO

[email protected]

Broadband Beyond Borders

2Copyright 2015 Carlson Wireless Technologies Inc.

Summary Lack of affordability is the primary reason that there are still 4 billion

people who do not have access to the internet. We are providing a radically different way for people, schools and businesses to get connected to the internet by repurposing unused television frequencies for two-way broadband. This does not require line-of-sight or fiber.

Fortunately the heavy lifting on regulations has been done by a global organization, Dynamic Spectrum Alliance, of which we are a founding member. Now with many countries either in process or having completed regulations to allow unused TV spectrum, ‘white space’, to be repurposed for broadband, the time is right for us to bring in the next generation of radios to break through the price barrier.

We will explain how the technology of Carlson cognitive radios can help close the digital divide and enable the Internet of Things to improve health, education and e-commerce for all.


Who Is Carlson Wireless? Since 2000, Carlson Wireless has been providing mission-critical

voice and data communications systems for rural, remote and difficult to reach areas around the globe.

With a customer base located in more than 40 countries around the world (including 100 Fortune 500 companies, public safety agencies, and municipalities) Carlson Wireless has been making an impact in the communications industry.

We believe that the world has evolved to a point where connectivity is an essential human need.

Carlson is enabling affordable broadband access for the next billion users by minimizing the infrastructure with a system that does not require fiber or line of sight.


Problem - 60% of the World and 6 Million US Households Do Not Have Access to the Internet

75% of potential users are left behind due to lack of affordability. Others are limited by location and accessibility. Worldwide, Carlson is involved in multiple trials and has already begun to bring broadband to previously unreachable schools and communities.

In the US, telcos have the commitments and funds to connect 2.5 million homes to the Internet, they just need a viable solution. Carlson Wireless believes TV White Space technology is part of that solution.

World heat map showing web usage Broadband .gov - Map of US with Internet access (green)


What is TV White Space Technology?

The transition of television from analog to digital in 2010 created unused spectrum known as TV White Spaces (TVWS), reserved by the FCC for unlicensed use. These vacant TV channels are capable of delivering broadband signals via non-line-of-sight (NLOS) transmission as opposed to higher frequencies which require towers.

TVWS technology is an affordable alternative to fiber, microwave, mobile and satellite technologies, needing minimal infrastructure to extend broadband coverage.

TVWS offers superior signal propagation characteristics and, with minimal equipment, can reach users in remote and rugged locations.


Why TVWS?

Access to additional clean spectrum

The lower frequencies perform well even when obstructed by terrain or foliage

Significantly increased coverage allows fewer access points for more users

Manage co-existence via database2.4 GHz coverage

600 MHz coverage


The Carlson Advantage

Of the few companies that have attempted to design a production product for TV White Space, our team at Carlson has proven we have the know-how to produce reliable and affordable products that meet the strict regulatory specs.

Now, with our experience and design skills, we plan to be first to market with a Generation 3 product with capacity above 50 Mbps, low power consumption, and latencies under 35 ms.


Carlson Employees: Jim Carlson, Sebastien Amiot, Neil MacMullen,

Carlson Advisors: Mo Shakouri, Heikki Kokkinen, Ken Garnett, Subhash Roy

The Carlson Team has Strong Radio Experience

Jim Carlson, CEOFounder, CCI wireless CCI sold to Zhone

Carlson Employees

Heikki Kokkinen, PhD Founder, CEO, Fairspectrum

Subhash Roy, Founder, CEO, Q Factor

Carlson Advisors

Mo Shakouri, PhDChairman, WiMAX ForumCTO, Novation Broadband

Ken GarnetCTO, Cal.NetFormer CEO, Gold Nation Properties, Inc.

Sebastein Amiot, Sr. Software Engineer, Senior Principal Engineer at NXP

Neil MacMullen, Sr. Software EngineerUniversity of London,

Bill Narin, Biz Dev &Sales, MIT Slone MBA


White Space Hotspot, WISP & Rural Broadband, Public Safety, Industrial: Oil & Gas, Utilities: Energy & Power, Internet of Things & M2M, Smart Cities, Transportation

Market Opportunities for TVWSWhite Space Hotspot

WISP & Rural Broadband

Utilities: Energy & Power

Transportation

Internet of Things & M2M A solution for WISPs to reach their

“last mile”, Alternative to 900 MHz, non-line-of-

sight. Penetrates trees, hills

Public Safety

Industrial: Oil & Gas

Emergency broadband communications

Emergency response / Disaster relief network

Remotely monitor, manage and control essential data Oversee worker and equip. safety Improved communications using

prime spectrum

Operational SCADA use Smart metering and power grid

control Machine automation

Provide community connectivity via libraries, municipal areas, shopping centers, parks and recreation areas, office buildings, etc.

Smart Cities

Monitor SCADA and telemetry Equipment

Smart grid automation & control Video surveillance capabilities

Trailers from motor freight PTC (Positive train control) Shipping containers

Smart roads and traffic signal management

City-wide connected TV White Space hotspots


Broadband Connectivity for Education

Google sponsored a 10 school TVWS installation with TENET in Cape Town, South Africa using Carlson equipment.


Transportation - Intelligent Railroad

Alaska Railroad

• Positive Train Control - PTC

• 470 miles of backhaul radios

• Fairbanks to Seward

• Runs passenger service daily

470 miles of track

• 95,387 total miles of U.S. railroad

• $6b - $22 billion to be spent on Positive Train Control by Dec 2015

• Mandated: U.S. Rail Safety Improvement Act of 2008


Public Safety Police and Fire Departments

• In areas where 3G services are not available or too costly

• Nomadic broadband

• Delivery through trees and buildings

• Remove all OPEX from mobile data cards


Water and Wastewater Industry

American Water just completed 6 month testing – good result

Extends their reach without towers

Adds video for security

New clean spectrum

Less infrastructure


Agriculture – Water control

Use TVWS to monitor moisture and temperature on a per acre basis to minimize water usage.


Competitive Analysis

Manufacturer RangeBondingChannels

Max Mbps

Manuf. Antennas

GPS CPE Price

CarlsonGen 2

14 km No 16 Mbps Yes No $400

Carlson Gen 3

14 km Yes 60 Mbps Yes Yes $250

KTS 8 km No 3 Mbps Yes No $900

Adaptrum 10 km No 14 Mbps No No $800

6harmonics 6 km No 12 Mbps No No $800

Redline 8 km No 20 Mbps Yes Yes $2000+


Design and testing: Carlson develops and designs component board. Carlson tests radio design, optimizing in-house expertize.

Manufacturing: Carlson outsources board manufacturing to various firms after completing design and testing.

Final Assembly: Carlson assembles radios and tests quality of final radio in-house at Carlson headquarters

Marketing & Sales: Sales through direct web and telephone contacts. Strong global sales with distributors. Customers: Railroad, WISPs, Oil & Gas, Public Safety, Industrial, Internet of Things, M2M…and growing.

Carlson Business Model

Design & Testing

Manufacturing

Marketing & Sales

Final Assembly

Sales through direct web and telephone contacts.Strong global sales with distributors.Customers: Railroad, WISPs, Oil & Gas, Public Safety, Industrial, Internet of Things…and growing

Carlson designs and develops component board

Carlson tests radio design, optimizing in-house expertise

Carlson outsources board manufacturing to various firms after completing design and testing

Carlson assembles radios and tests quality of final radio in-house at Carlson headquarters


Financials and Projections – 2013 to 2018(All figures in thousands)

2014

$1,306

612

694

250

399

522

1,171

(478)

2015

$4,377

1,774

2,603

438

708

433

1,578

1,024

2016

$17,404

6,295

11,109

1,740

2,637

1,485

5,862

5,246

2017

$50,401

16,357

34,043

5,040

7,126

3,749

15,914

18,129

Calendar Year 2013

Total Revenue $1,781

Cost of Goods Sold 1,204

Gross Margin 577

R&D 356

Sales & Marketing 393

General & Admin 654

Total Expenses 1,404

EBITDA (827)

2018

$182,464

68,149

114,315

18,246

27,370

14,597

60,213

54,102


Allotment of $5M Equity Funds

Capital Table Notes

Price per share $3.00

Shares outstanding ~ 5.6M

Share price x total shares ~$17M

Use of Capital in 1000’s Notes

Research & design $1525 Continue to generation 3

Working capital $900 Finance AR growth

Patent work $100 6 provisional and 6 utility

Manuf. test equip $125 Auto test equip

Sales & marketing $500 Travel and San Jose office

Gen 3 inventory $950 2000 piece run

Debt consolidation $800 Retire contractual debts

Total capital raise $5000 All or none with $2.5M min


Conclusion

Dynamic Spectrum Sharing (DSS) via TVWS and other frequencies is the way of the future.

Carlson is well positioned to expand sales dramatically and maintain global leadership in the DSS market.

RuralConnect Gen 2 has been field proven and has met FCC and other regulatory certification, thus reducing risk.

Gen 3 breaks through price-performance barriers to open up significant opportunities across multiple segments.

The potential exists for a billion dollar market in the next 3 years.

Carlson Wireless Technologies - Gen 3 TV White Space Radio, RuralConnect

Technology

Transcript of Carlson Wireless Technologies - Gen 3 TV White Space Radio, RuralConnect