Australia’s biggest telco likes the look of the MG400, a 4G Internet of things (IoT) gateway device made by IT equipment company Beam Communications (ASX:BCC).

Beam said this morning that Telstra had approved the product, paving the way for much wider adoption as the telco moves to phase out its 3G network by 2024.

In response to the news, BCC shares were a standout performer in morning trade:

Getting in position

Beam said the Telstra certification leaves it well-placed to benefit as more 3G networks are decommissioned — a shift which could be larger than expected.

Exact numbers are hard to calculate, but the company cited a report by the Australian Computer Society and PwC released in September 2018, which estimated that around 30 per cent of global IoT devices are still reliant on 3G.

Beam non-executive director David Stewart said the percentage in Australia could be “much higher”.

“For instance, there are several hundred thousand 3G units used in semi-rural electricity meters alone,” he said.

“If you throw in vending machines, public transport systems, parking meters and other industrial applications that require connectivity, the number can exceed a million devices that will need to be upgraded.”

In that context, the company said Telstra approval gives it further strength due to the Telco’s position as the dominant 4G provider in the local market.

The MG400 is a hardware product that facilitates a 4G gateway service for various applications, including IoT and machine-to-machine networks along with wifi hotspots, fleet management and emergency response services.

The company said it’s the first IoT gateway product approved by Telstra that has an LTE Cat-13 accreditation, which can operate up to 30 per cent faster than existing Cat-6 devices.

Stockhead has contacted the company for guidance on how it expects the approval to affect its 12-month revenue outlook.

Beam said will now aim to establish distribution channels in order to sell the product “Australia-wide”.


In other ASX tech news today:

VR and AR software company ServTech Global (ASX:SVT) (soon to be renamed Vection) has announced a distribution agreement with the Finland-based Fulvisol. The company said Fulvisol will help commercialise the company’s FrameS VR-software in the Scandinavian market.

The deal brings the number of partners in SVT’s European reseller network to nine. Shares in SVT were up 6.25 per cent in morning trade to 1.7 cents.