Netlinkz launches VSN 2.0 platform as need for network security and enabling disparate work forces increases due to COVID-19

Netlinkz Ltd (ASX:NET) has launched sales of its VSN 2.0 secure solution as global focus remains on network security and enabling disparate work forces on the back of the continued global COVID-19 pandemic. The company has made strong progress in implementing the internal processes and infrastructure to facilitate the support of a global rollout of the VSN at speed.  Discussions have started with distributors and resellers in numerous regions with the goal of rolling out the VSN platform along with partner technologies. Phase 1 of embedding partner technologies A number of distributor, reseller and partner agreements have been signed, including with ImageDeep, Cognian and Alex31. The VSN 2.0 enables the company to integrate Cognian and ImageDeep as a COVID-19 end-to-end secure solution. This is phase 1 of embedding numerous partner technologies into the VSN platform. A pilot of the Cognian and ImageDeep COVID-safe technology in Victoria is set to begin later this month. Global rollout of VSN platform ➢ China: The VSN 2.0 platform was launched in August 2020 and is being embedded into customer networks. Multi-national and national organisations are continuing to test the VSN 2.0 in the Beijing IoT Lab. Customers are seeing reduced latency and better handling of data packet loss, with enhanced features in Quality of Service, Deep Packet Inspection and the new management console. Netlinkz is seeing several projects and customers turning to the company for recurring engineering work as it embeds the VSN and iLinkAll as a trusted partner for their networks and security. The focus of the sales team continues to be one of engaging with as many mid to large corporates in China as possible. The most traction is seen in the healthcare, infrastructure, smart city solutions, autonomous vehicles, mobility and logistics sectors. The Chengdu water project is now moving into a new phase, with initial network testing commencing and a view to project go-live mid-2021. ➢ Japan: It has executed a distribution agreement with Alex31 for VSN 2.0 to go to market immediately. Alex31 provides network solutions to small and medium-sized companies in Japan and is expanding its business in 'work from home' solutions using the VSN. Japan IoT is showcasing a Netlinkz embedded VSN securing the Cognian Syncromesh and ImageDeep thermal COVID-19 tracking application. Testing of the VSN continues by Japanese multinational corporates and local Japanese organisations. There is demand from commercial building owners looking for secure enhancements to create a COVID-safe work environment and encourage tenants to go back to the office. ➢ India: Netlinkz has engaged Natsoft Corporation to develop and source selected international markets and customers through a reseller agreement for its Netlinkz products and establish an IoT Lab in Natsoft’s offices in India. The first Scope of Work with Natsoft has been agreed and executed. It is also in talks with other partners to ensure diversity of market. ➢ Australia: Australia is the focal point for developing and managing resellers, distributors and partners for Netlinkz globally. The Australian IoT lab is the support centre for Netlinkz global customers outside China. Separate to SSI, Netlinkz signed contracts during the quarter with a combined value of $1.5 million, worth $0.5 million in annually recurring revenue. It is now focused on driving additional value from the SSI and Netlinkz VSN integration. ➢ Europe Netlinkz has entered into a preliminary memorandum of understanding to explore the setting up of an IoT Lab in Europe. Patent registrations Patent and trademark registrations are ongoing for the VSN technology in China and the rest of the world, to allow Netlinkz to develop and deploy geographic-specific VSN source code in other countries. The Netlinkz VSN has developed the VSN overlay technology platform that provides a physical and virtual secure ‘Network as a Service’ for enterprises of all sizes. Focused on cloud-first, security, scalability and simplicity, it allows users to concentrate on business growth, team collaboration, and global sharing of critical data. The VSN technology makes Fortune-500 security commercially available for organizations of all sizes. Record receipts in quarter Netlinkz achieved record receipts from customers for the quarter ended September 30, 2020, driven by increasing demand for its VSN platform, particularly in China. Receipts from customers grew 89% quarter-on-quarter to $5.8 million, up from the June quarter total of $3.1 million. Netlinkz’s recurring revenue continues to track up and is likely to account for a greater percentage of customer receipts as new VSN deployments are secured. This is the third consecutive quarter of strong growth in receipts from customers this calendar year and Netlinkz is comfortably placed to meet its previously stated guidance of $15.5 million of receipts from customers by the end of 2020. New appointments In September, the company announced the appointment of a number of senior executives and non-executive directors to continue to accelerate growth and implement a sustainable process to ensure the continued delivery of revenue. Whilst this adds to the cost base in the short term, Netlinkz expects this to pay off within six months. It appointed James Stickland, Dr Geoff Raby and Grant Booker as independent non-executive directors. Raby, Australia’s former ambassador to China from 2007 to 2011, will provide Netlinkz with important representation in the Chinese market during a critical growth phase.