Synchronica started life as DAT Group with a very ambitious target of taking on RIM's architecture but targetting the entry level customers in the marketplace. They tried and failed on numerous occassions - most likely because their focus was on integrating with Microsoft technologies (not cheap!). They have now adapted their strategy under their CEO and co-founder Carsten to focus on open standards and only on emerging markets (which also happen to be the biggest mobile phone market of which smart phones like that of the Blackberry only have a very small market share despite their apparent ubiquitous nature).
Synchronica provide the facilities to allow network operators to provide push email, mobile backup and other services over their gateway for which they charge a one off cost plus servicing and consulting fees. They have now taken this to a new level trying to capture all possible revenue generating areas by launching their own budget phone pre-configured to work with their gateway solution.
I had the chance to chat with Carsten and he confirmed the approach that I believe the company is taking in that email is just the most obvious initial product to provide over their mobile gateway, although the architecture is in place to support any sort of data dissemination and synchronisation so there are plenty of growth opportunities.
The biggest risk with Synchronica in my mind is the fact that they need to be first to market with this - which indeed they seem to be. There is nothing to stop another company coming in at a later point although the expectation is that there is a year window whilst other companies could develop and get a product / service up to the level of Synchronica's which buys them much needed time.
The final winning point for me is Carsten himself. He clearly has a lot of experience with mobile technology and some very good ideas to take the business forwards, answering my probing questions very diligently. He wants to be the market leader in a relatively untapped area (budget phones) or as he describes it "the company known for producing the 'poor man's Blackberry'". and the phone is certainly not poor - we had a look and play with it, the interface has the same look and feel and is actually slightly smaller than a blackberry. You'd never guess it was 1/5 of the price to manufacture!
I now have over 10% of my portfolio invested in Synchronica at a mid price of 2.86p and I could not be happier. This stock remains a strong buy with an end of year target in the region of 8-9p for me as the company starts to hit profitability. For full and further reports from myself please check out the free bulletin board on ADVFN (alithetrader)
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