USTelematics Announces Contract with Largest Verizon Wireless Distributor to Double Revenues for Data Service Activation

USTelematics, Inc. announced that it has negotiated an agreement that will double the Company’s commission income rate for activating new Verizon broadband wireless wide area network subscriptions for users of USTelematics’ proprietary Voyager brand wireless mobile products.

With this new commission arrangement, the profit realized through connecting each Voyager buyer to Verizon now exceeds the gross margins on the sale of each Voyager Mobile Internet Protocol Television unit.

Voyager is an advanced rear-seat infotainment system for passenger vehicles that enables passengers on the roads nationwide to enjoy live mobile television, movies, music, computer gaming and more. Voyager also generates a Wi-Fi hotspot that envelops the vehicle to enable full internet access for portable computers in the car.

The new revenue agreement signals an important shift in strategy for UTLM that elevates the value of data subscription services for infotainment content alongside hardware sales.

“This deal to increase our Verizon commission rate creates a more robust revenue model for UTLM’s Voyager product line,” said Howard Leventhal, Chief Executive Officer of USTelematics. “We’ve executed this ‘Trojan Horse’ strategy to profitably leverage the sales of Voyager hardware to generate an even more important revenue stream in the sales commissions of subscription broadband services.”

Mr. Leventhal added, “Our newest mission is put our products into the cars of as many American families as possible so that we will profit by connecting those millions of users comprising our target market to the information and entertainment services they clearly need and want.”

USTelematics’ new Verizon commission agreement is through Verizon’s largest master agent, Celluphone, Inc., of Los Angeles. Founded in 1983, Celluphone was appointed the first Authorized Agent for Verizon Wireless (then AT&T AMPS) thirteen months before cellular service was launched in the Los Angeles area. Since then, Celluphone has grown to become one of the largest wireless distributors in the United States.

Verizon’s Value Added Distributor (VAD) Program, in which UTLM had been enrolled for some time, was designed for low-volume, specialized operations.

“By entering into this indirect relationship with Verizon through Celluphone, we can take advantage of the most-favored commission rate that Verizon pays to Celluphone after 20-plus years of doing business together,” said Mr. Leventhal. “Commissions paid to USTelematics through its new relationship with Celluphone are at approximately double the rate of commissions paid under the Verizon VAD program.”

With the recent availability and widespread coverage of Verizon’s EV-DO Rev.A wireless broadband service, nearly 200 million U.S. consumers are within range of the reliable, high quality, live Mobile TV, game, education and information programming content available by using UTLM’s Voyager Mobile IPTV system.

“Verizon’s recent relaxation of restrictions on streaming video unleashes the full power of this technology in support of Voyager to the manifest benefit of families traveling with kids in cars,” said Mr. Leventhal.