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Telecommunications companies are under threat from over-the-top (OTT) services that enable consumers to communicate over the internet via streaming content and apps such as Skype, WhatsApp and Viber. These services currently handle over 80% of messaging traffic, and more than a third of all global voice traffic is channeled through Skype. This astounding level of competition demands that telecommunications companies focus on modernizing their operations and creating strategies to develop new products or services if they hope to achieve sustainable growth. One of the companies at the forefront of innovative strategy implementation is Hammer Fiber Optics Holdings Corporation (OTC:HMMR) (HMMR Profile ), a telecommunications company investing in the future of wireless technology and fiber optics. Other significant players in this industry include Verizon Communications Inc., Amazon.com, Inc., Alphabet Inc. and Comcast Corporation.
Hammer Fiber Optics is an internet service provider (ISP) offering internet, voice, video and data services in New Jersey, as well as carrier services in Philadelphia and New York. It serves both residential and commercial markets with high-capacity broadband, voice and video through direct fiber as well as its wireless fiber platform, Hammer Wireless® AIR technology.
The holdings of Hammer Fiber Optics include Hammer Fiber Optic Investments, Ltd., D/B/A Hammer Communications. This company formerly traded under the name of Hammer Fiber but was renamed, restructured and rebranded in April 2018.
Hammer Communications manages the company's residential and SME services delivered by terrestrial fiber optics and its proprietary fixed wireless technology, as well as its VoIP services. The company also has two separate business units under its control: Hammer Fiber and Hammer Sphere. Hammer Fiber is responsible for the delivery and management of the company's fiber optics services. Hammer Sphere manages the company's rapidly growing platform for cloud services and hosting.
Following the restructuring announcement Hammer Communications CEO Mark Stogdill said, "We are excited about this evolution for Hammer. Hammer is quick to respond to the market's needs and ensure the best quality of service for our customers. This move will help us to better communicate the services we offer and commit our resources where they can best serve the customer experience as we continue to grow and expand our service offerings."
In addition to restructuring, Hammer Communications announced yesterday that a letter of intent to acquire the stock of 1stPoint Communications, LLC, and its subsidiaries, including Open Data Centers, LLC, and Endstream Communications, LLC, has been executed by all parties (https://finance.yahoo.com/news/hammer-fiber-acquire-1stpoint-communications-113000112.html). 1stPoint is a competitive local exchange carrier operating nationwide with intellectual property in services such as SMS/texting, collaboration tools and carrier switching. Endstream Communications offers wholesale voice services worldwide. Open Data Centers operates a carrier-neutral colocation facility in Piscataway, N.J., and will provide the brick-and-mortar capacity to further Hammer's growth.
This the first acquisition for Hammer Communications. Adding these assets and related entities position Hammer Communications as a bona fide player in the cloud services arena. The assets, revenue, client base and strong management team at 1st Point position HMMR for significant growth moving forward.
Hammer's Proprietary Fixed Wireless Technology
Finally, Hammer Communications recently completed the initial development phase of its advanced LTE fixed wireless system, designed and built using its proprietary wireless technology. In conjunction with technology partners in Europe, the company has been running both laboratory and field trials on the live network of a prominent LTE mobile operator for the past 12 months, and the results have surpassed all expectations. This expansion adds ultra-high capacity cellular broadband applications to the company's product portfolio, which includes wholesale services including backhaul support for cellular network operators.
This latest innovation was designed to complement Hammer Communications' core business of residential service. With the large amount of bandwidth the system can deliver, as well as the large number of users it can connect, the company expects this initiative to position it as a leader in future 5G technology. This new service will leverage the fixed LTE system in conjunction with Hammer's Fixed Wireless DOCSIS 3.1 system, already in place, to deliver high-capacity broadband to markets across the Unites States at substantially lower costs than traditional wireline mechanisms, including fiber. The company will start live field testing of the new system in early 2018, with service availability anticipated later in the year.
Michael Cothill, executive chairman of Hammer Communications, noted that "5G is the inevitable next step in the evolution of telecommunications, and we are proud to be on the front lines of developing the technology to support the vision of things to come. We believe this system fits perfectly into our overall ecosystem, and pairing this platform with our existing DOCSIS platform is going to expand our reach, and extend our next generation fixed LTE initiative to included wholesale services to both the mainstream LTE operators and competitive carriers across the USA.
Expanding Services into the Cloud
Hammer recently formed a new business unit, Hammer Sphere, under the Hammer Communications umbrella. This unit will have responsibility for the company's expanded IaaS cloud services that will enable its clients to host their products via the company's leading-edge server infrastructure, fiber network and data center.
Hammer Sphere will provide a robust and modern server infrastructure, fiber network architecture and data center that enable efficient hosting and fast delivery of clients' products. Its range of services will enable client companies to eliminate the extensive costs associated with the establishment and maintenance of a corporate data center, while harvesting the benefits of cloud-based services.
All these initiatives indicate Hammer Communications' commitment to deploying strategies to provide modern and cutting-edge telecommunications solutions that will enable it to grow and prosper. The company is ably supported in its endeavors by a seasoned leadership team with extensive experience and understanding of the telecommunications industry, including sales, marketing, engineering, construction and business development.
Other Companies in the Telecommunications Space
Verizon Communications Inc. - With a market cap of almost $198 billion, Verizon is one of the largest telecommunications companies in the world. The company offers communications, information and entertainment products and services to consumers and businesses around the globe. Its wireless segment provides wireless, voice and data, internet access, multimedia, international travel and IoT network access services.
Verizon is gearing up to invest in 5G network capability following the Federal Communications Commission's recent decision to remove regulatory roadblocks to the implementation of this technology. Along with Cisco and Juniper Networks, the company is using software-defined networking (SDN) technology to combine all its existing service edge routers for Ethernet and IP-based services into a single platform to improve network operational efficiency and increase functionality and flexibility.
Amazon.com, Inc. - Through its subsidiary, Amazon Web Services (AWS), the company provides on-demand cloud computing platforms to individuals, companies and governments on paid subscription basis. Its technology enables subscribers to access a fully-fledged virtual cluster of computers 24/7 through the internet via server farms throughout the world.
AWS offers over 90 services, including computing, data storage, networking, database, analytics, application services, deployment, mobile, developer tools and a platform for IoT. AWS was the standout performer of Amazon's stable of subsidiaries in the last quarter of 2017. Amazon reported net sales of $51 billion, a massive increase of 42.9 percent over 2016, with net sales increasing by 39 percent over the previous quarter.
Alphabet Inc.- Alphabet is the newly formed holding company for Google and other subsidiaries. The Google segment of Alphabet's business includes internet products such as Ads, Android, Chrome, Commerce, Google Cloud, Google Maps, Google Play, Hardware, Search and YouTube. It offers digital content, enterprise cloud services, hardware products and other miscellaneous products and services.
Google is also launching a new investment program aimed at early-stage startups to provide financial resources, access to Google features and tools, and the Google Cloud Platform. In addition, the company will offer promotional support to young companies. This investment program will support startups using Google Assistant's in the travel, hospitality and gaming industries.
Comcast Corporation - Comcast is the largest cable company in the United States. Its cable communications segment offers video, high-speed internet, voice, security and automation services to both residential and business customers via its XFINITY brand. The company also provides business services that include Ethernet network and cellular backhaul services to mobile network operators. Comcast's high-speed internet segment is growing rapidly, reaching $4.2 billion in the last quarter, representing an increase of 8.2 percent year-over-year.
On May 2, 2018, the company announced a multimillion dollar investment in the expansion of its fiber-based network in Arlington and Alexandria, providing access to an additional 350 businesses directly and benefiting hundreds more. Comcast is one of the fastest growing Ethernet providers in the United States and serves 20 of the top 25 markets.
These companies are all striving to improve their telecommunications offerings in an ongoing drive to provide high-quality products and services for their customers. Their efforts to provide the highest quality services will lead to company growth and stave off the competition from OTTs, which are often beset by poor connectivity and communication quality problems.
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