Subject: [NEXTEL-1] Relm seeking greater share of radio market- Products take on challenge of wild fires

From: NEXTEL-1
Date: Sat, 17 Jul 2004 16:31:40 -0400

Jul 15, 9:19 PM

Relm seeking greater share of radio market- Products take on challenge
of wild fires

BY BRIAN MONROE
FLORIDA TODAY

WEST MELBOURNE --
In the case of Super Glue, old
commercials would show a guy
wearing a construction helmet
suspended from the girder of a building
-- with only glue keeping this wriggling
fellow from certain doom.

For Land Rover, guys would
smack the undercarriage of a
vehicle with huge hammers.

Poor Timex watches were thrown
off buildings, submerged in the
ocean and beaten in a variety of
unseemly ways. Oh, by the way,
these gluttons for punishment also
tell time.

West Melbourne-based rugged-radio maker Relm Wireless Corp. is taking a
similar tack with its new digital portable radio as a testament to
potential buyers that its products work in harsh environments. The
company is having the Roosevelt Hotshots, an elite frontline
firefighting team based in Colorado, test 12 of Relm's digital radios
during the 2004 fire season, which runs from June to September in
Colorado.

Its deal with the Hotshots is among the recent developments at Relm that
officials there hope will boost revenue at one of Brevard County's few
remaining locally based, publicly traded companies.
Capturing more revenues is crucial for
Relm, which struggled after the high-tech
crash in 2001 and slumping overall
economy of recent years.

Its leader is optimistic. Relm President and
Chief Executive David Storey thinks his
company's revenues could increase to $100
million in the multibillion-dollar digital-radio
market within five years -- which would be
more than five times Relm's 2003 revenue
of $19.73 million.

The company's stock -- which was trading
as low as 45 cents in August 2003, rose as
high as $3.70 in March. It closed Thursday
at $2.40 in Over-the-Counter Bulletin
Board trading.

Among the other recent developments at
the company, Relm finalized a partnership
agreement with Irvine, Calif.-based
IPMobileNet, wireless voice and data firm.

Adding the ability for sending data, and not just voice, over radio
networks will help Relm be the total package for customers, Storey said.

Relm's strategy is to have a sturdy, well-built digital radio that
appeals to its current customer base -- police, firefighters and
forestry officials -- and garner new government clients.

The 70-employee company also hopes to add as many as seven jobs by the
end of the year.
Company officials thinkhomeland security and the Department of Defense
are areas ripe with financial opportunities with government spending
higher to fight the war on terror.

Current government customers said Relm radios have performed well
against big names like Motorola while being much less expensive.

"Things have turned around for the company from last year at this time,"
Storey said. "There are a series of positive building blocks for the
company on the revenue end, margin improvement and bottom-line net
income. We have brought all the indices of the company in the positive
range. The future looks good."

Part of that immediate future heavily involves Relm's digital radio,
which it introduced last year. The company had been using analog radios
for decades, but had to make the switch because of the advantages of
digital: clearer signals and better efficiency with frequencies.

This year, Relm also got its radios "fire-certified" by the National
Interagency Fire Center.
To continue that success, Storey said he has a three-pronged plan that
could help Relm boost revenues.
Encryption: Relm is expected to be able to make its radio's
transmissions more secure by adding encryption software.

That is something required by many government customers.

The company should have that feature available by August.

Trunking: By having microprocessors and software in radios, controllers
can assign certain groups available channels when they need them -- like
during a hurricane, earthquake or terrorist attack.

By doing that, specific groups -- like police and firefighters -- can
talk together, and when the crisis is over, the channel can be used by
others.

Trunking allows all users to share in the use of all channels
automatically, enhancing efficiency.
Relm radios could be trunking by 2005.

Analog business and industrial customers: Even with the move to digital,
Relm realizes there are some business and industrial customers that
might not be able to afford the newest radios.

But Storey thinks firms can benefit from newer analog products, and can
later upgrade if needs change.
To gain these added revenues, however, Relm has to have a digital radio
that is comparable to industry titans.

So how do Relm digital radios stack up against competitors like
Motorola, Thales Communications Inc. and Daniels Electronics Inc.?

"Relm was very close to the bigger companies," said Ralph Flora, radio
contracts and testing manager for U.S. Department of Agriculture Forest
Service. "It's a very good radio. The standby current is outstanding,
which means it has exceptional battery life for a digital radio."

He said, when there are glitches, Relm is quick to fix them.

"If Relm continues to improve their product and put more functionality
in it, other agencies will be interested, like the Department of
Justice, Homeland Security, Department of Defense. Relm could provide a
radio for them, too," Flora said.
Flora said there is a need for a low-cost digital radio with trunking
and encryption capabilities.
"That's why we are buying them," he said. "Relm could make a lot of
money, as long as they keep its digital radio at a reasonable cost, and,
now, they are the most reasonable."

All of the federal agencies "are heading to digital radios with
encryption," said Ken Brown, a telecommunications specialist with the
U.S. Department of Agriculture Forest Service. "There will be a very big
market for that technology."
Contact Monroe at 242-3655 or [email-masked]

http://www.floridatoday.com/!NEWSROOM/moneystoryB0716RELM.htm

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