Ionica Plc, the Cambridge, UK telecoms company pioneering a local loop telephone service based on low installation cost radio telephony units, has seen its fist quarter losses deepen as start-up costs increase. The company floated simultaneously in London and on the Nasdaq in July but the shares are currently trading at a 6% discount to their issue price of 390 pence. Net losses for the quarter were 30.3m pounds, up from losses last year of 1.3m pounds on revenue of 2.0m pounds up from 26,000 pounds. Heavy cash spending amounted to 34m pounds on operating costs and a further 22m pounds from expenditure on network and other fixed assets. Ionica claims to have connected 24,552 customers up to June 30th, most of whom will have been poached from British Telecommunications Plc as Ionica targets areas where until now, phone users have had no alternative to BT. Ionica’s network of base stations (which connect radio linked subscribers to the main telecoms infrastructure) now covers an estimated 1.4 million homes, mainly in the midlands region of the UK, with claimed penetration rates as high as 2.8%. Ionica is also claiming a high uptake of its second line facility in conjunction with free connection from VirginNet, the Internet Service Provider. All subscribers are provided with a double socket automatically and the second line can be switched on remotely. Future periods may see alternative and additional sources of revenue from overseas as the company currently has its technology on trial with 20 different service providers.
