Investment bank Merrill Lynch estimates that Comverse Technology (Nasdaq:CMVT) will make the best of its huge cash reserves of almost $2 billion for unified messaging acquisitions, and for strengthening its respective capabilities.
Analysts Tal Liani and Tania Jovanovic claim that the technical problems in Comverse's service platform, and the fact that unified messaging is still in its early stages, will in the short-term increase Comverse's dependence on voice mailbox revenue, which hasn't been growing.
The analysts estimate that Comverse is already working on a new solution for unified messaging services based on its email platform and including other capabilities. The analysts believe that Comverse will eventually launch a new solution and that this will enable it to establish its position as a leading unified messaging provider.
Comverse develops software and hardware supporting network-based services, such as short message, voice mailbox, Internet and cellular information services, and multimedia services.
Comverse has recently estimated that revenue from voice mailbox services will increase but less than in the preceding quarters. The company believes the market will revive in mid-2002.
In fact, the company doesn't expect to see significant revenue from unified messaging, multimedia messaging services, or content platforms before 2003 at the earliest. Cellular subscribers have so far shown little interest in unified messaging applications, and due to the low penetration of cellular devices supporting multimedia applications.
After Comverse announced it would be providing AT&T Wireless (NYSE:AWE) with a unified messaging platform for AT&T's 3G network, AT&T revoked the win. TheMarker has recently reported that AT&T might change its mind yet again.