Location: Interview, Cy Smith

1. Tell us about the business of AirSage.

AirSage is the leading provider of reliable and accurate real-time traffic information. We use our patented WiSE™ (Wireless Signaling Extraction) technology, which aggregates anonymous signaling data from cell phones. We then provide our partners and customers with the highest quality speed, travel time and traffic flow information. Our data covers highways, freeways, primary roadways and arterial roads, and we’re currently the only company in the U.S. with a wireless carrier partner that is committed to a nationwide deployment. At the same time, we’ve also partnered with several European and Asian-based companies to deliver real-time traffic information to rapidly-growing parts of the world.

2. Recently AirSage has launched a developer’s zone. Can you give us an overview of that?

The AirSage Developer Zone provides open access to our real-time traffic information. Developers can use our data to create their own unique traffic applications. They’ll also be able to access an actual data feed as well as a map overlay. They can use the data to create their own navigation, Web, logistics, Intelligent Transportation System (ITS) and other traffic applications.

Opening up our API allows us to lower the barriers and reach out to consumers as well as product development interests. We hope this cooperative exchange will lead to the development of a creative, entrepreneurial community that will open exciting new markets for all parties involved.

3. How is your traffic solution different from other real-time traffic solution providers?

There are a few other companies providing real-time traffic information, but compared to other methods used, we’re confident that we can provide the most accurate and reliable information for the lowest cost. We’ve seen a lot of companies relying on predictive traffic models, but when half of all congestion is non-recurring, predictive has some obvious drawbacks. Companies are also using GPS to supplement data, but there are only a few hundred thousand trackable GPS units, compared to the tens of millions of cell phone signals that are available. GPS units also report back on an infrequent basis (typically once an hour), while cell phones provide a more frequent stream of data. Then when you look at traditional hardware-based solutions, like sensors and cameras, implementation is costly and time-consuming. Our solution can be implemented in weeks instead of months.

4. How does the predictive traffic information enhance the value proposition of navigation systems? What benefits does it bring to navigation systems?

Navigation systems with integrated real-time traffic information will shape the way we drive and affect congestion on unprecedented levels. With AirSage’s real-time traffic information, navigation systems can calculate best routes based on travel times. Consumers can view traffic conditions on their navigation systems and look for alternate routes if they see problems ahead. They might also choose to delay their departure or leave earlier if they know how their travel time might change based on traffic data. Inevitably, drivers will be able to circumnavigate traffic tie-ups and get to their destination in a timely and stress-free manner.

5. What is your business model and who are your partners? Do you have any strategic wireless partners?

Our model is to aggregate wireless signaling data from multiple carriers to provide the best quality traffic information on the most roads. Sprint is currently our primary provider, although we expect to have others onboard soon. We partner with best companies in several market segments to deliver our data to consumers via in-vehicle navigation systems, portable navigation systems, radio & TV stations, transportation agencies, cell phones, Web sites and commercial fleet operators.

6. What are your projections for the subscriber base for traffic information?

The potential is huge and can be measured in the millions. Market research suggests that 80 percent of consumers have a high level of interest in receiving quality traffic information. Of those 200 million drivers, 60 million have expressed a willingness to pay between $5 and $10 per month. As consumers become savvy, and demand for in-vehicle technology grows, the subscriber base will fuel a competitive, billion-dollar industry.

7. What are your plans for overseas markets?

European and Asian market opportunities are expected to exceed the U.S. in terms of potential revenue. Research suggests that the U.S. market represents less than 45 percent of the world's market potential. Therefore, we've begun to take steps to prepare for a launch into Europe, Asia and other global markets. In September 2006, we signed an MOU with Orange Switzerland to implement its traffic monitoring technology in Switzerland. The Orange Group/France Telecom, with more than 85 million customers throughout Europe, is involved and has already begun the process to standardize the program for all of their operating countries. In August 2007, we signed an MOU with Autonavi, the leading provider of location-based services infrastructure software in China. Autonavi has more than 500,000 navigation customers and is expected to be the company's primary distribution partner in China. We're working with Autonavi on a technology trial with China Mobile, which has more than 300 million subscribers and could be a significant carrier partner for AirSage. And in June 2008, we entered into a partnership with Logica to provide traffic information in Europe.

8. What does your solution mean to consumers?

I think that convenience is the quick answer, but there are really four main benefits that consumers will see. The first is that drivers will spend less time stuck in traffic (and more time being on time). The second is that drivers will waste less fuel, idling in congestion. With the world’s increasing dependency on oil, this is a positive step toward lowering demand. Third, drivers who have access to real-time traffic information will be able to avoid the stress that comes along with congestion. And in the end, it will lead to a better quality of life. More convenience and better mobility. Your commute will be one less thing to worry about.