On Sat., 7/26 CouchPoDATO wrote:
>1. XETA's biggest products are private branch exchange >(PBX) systems for hotels. If memory serves correct, these >are the systems that will fry your modem if you try to go >on-line without a special modem line. Unless things have >changed with these PBX's, I don't see too many of them >anymore. Are these the same modem-cookers that I've seen >in the past?

I don't know about this specifically, but the newest product that XETA has is called XPANDER which allows hotels to upgrade their existing PBXs to handle additional phone lines in each hotel room, giving people the ability to hook up their laptops while still being able to make and receive voice calls on a separate line. This upgrade is supposed to be cheaper than a traditional PBX upgrade.

>2. The hotel and travel industries are booming, and will >probably continue to do so for the next 20 years+. As >such, there is a great opportunity for all firms connected >directly or indirectly to this industry. What is XETA's >market share? Are they an industry leader? Is there >technology cutting edge? Is there new technology that >threatens XETA's postion?

As mentioned above, their XPANDER product is cutting edge, and has been designed to work with any existing PBX system, effectively doubling its capacity. XETA sells Hitachi PBXs, and other related products that they purchase from manufacturers. They also recently established an agreement with MCI to market their long distance services to hotels. I do not know what their market share is, but would be interested in knowing myself.

>3. How expensive is this stuff? Can hotels easily switch >systems, or would you consider this an infrastructure item? >Does the company earn material revenue from existing >customer (i.e., upgrades and customer support)?

PBX upgrades and installation are typically expensive. Coming out of the second quarter, XETA had a large backlog in orders, both for Hitachi systems and their XPANDER upgrade, to carry them forward.