NEW YORK-Comparatively few of the hundreds of telecommunications billing companies in business today are publicly traded, but that list could grow by one if Daleen Technologies Inc., Boca Raton, Fla., proceeds with a planned initial public offering scheduled for late this month.
The company views as its main competitors: the Kenan Systems Corp. division of Lucent Technologies Inc.; Saville Systems plc, which ADC Telecommunications Inc. plans to acquire; Portal Software Inc.; LHS Group Inc.; Amdocs Ltd. and International Telecommunications Data Systems Inc., which have announced plans for a merger; and Intertech Management Group Inc. Other competitors include Sema Group plc and Intasys Corp.
“No competitor is dominant, and we believe that each of the largest companies with [which] we compete directly holds less than a 10-percent share of the market,” the preliminary offering statement said.
Daleen plans to sell 4.1 million shares at $10-$12 each. Banc Boston Robertson Stephens is lead manager for the IPO, which will trade on Nasdaq.
Proceeds will be used for working capital and general corporate purposes, including funding product development and expanding sales and marketing, the preliminary prospectus said.
Founded in 1989 as a software consulting company, Daleen changed hats and identities in 1996. In 1997, it introduced its BillPlex software, which enables telecommunications providers to manage billing, payment processing, call rating, service provisioning and customer care on a central Windows NT or UNIX operating system.
The BillPlex system uses industry standard, open Application Programming Interfaces, which permit “rapid integration with a variety of operational and business support systems,” the red herring said.
“BillPlex also provides an optional Web interface that allows subscribers to view their account status and perform other self-care functions at any time over the Internet.”
The majority of Daleen’s customers are integrated communications providers in the United States and Latin America “who have indicated … they use or plan to use BillPlex to support Internet access and data services in addition to traditional voice services.”
Without identifying its customers, Daleen said it defines so-called ICPs as new or incumbent carriers that bundle a variety of services like local and long-distance wireline, wireless, cable TV and Internet access.
The company plans to enter the European market next year and Southeast Asia in 2001.
Daleen also said it has scheduled for release early next year “a complete, service-ready billing and customer-care system that will enable a wireless carrier to bill for:
Residential and business-zoned wireless and personal communications services, like free airtime minutes and tiered airtime rating charges and discounts.
Long-distance services, including zoned toll areas and custom-calling wireless features.
The processing, clearing and billing of third-party network calls.
In 1998, the company earned revenues from BillPlex for the first time. Daleen reported revenues of $5.2 million during fiscal year 1998, which ended Dec. 31, and net losses of $12.2 million. It derived about 35 percent of last year’s revenues from BillPlex license fees and the rest from related consulting, maintenance and training services it provided.
During the first half of this year, the company reported revenues of $7.1 million, of which BillPlex licese fees accounted for $3.7 million and related professional services for $3.4 million.
The rise in revenues is attributable “to a significant increase in the number of implementations and newly booked contracts in the six months ended June 30,” the preliminary offering statement said.
The company said it has established “strategic marketing alliances with industry-leading information systems integrators, [including] CAP Gemini, Danet and Unisys, and providers of complementary information systems compnents, [like] Eftia, Oracle, Telcordia and Vertex.”
“We are continually seeking to expand the number of partners we work with to further penetrate the market and accelerate our growth,” the preliminary prospectus said.
