When Peter Conlon looks back at his career, he may muse that September 2013 was the month in which the revolution he has brought to Nautel Ltd. bore fruit.
Started in 1969, the Hackett’s Cove manufacturer was a maker of niche radio transmitters before Conlon became CEO in 2006. But as the world entered its economic catastrophe in 2008, he led Nautel in an initiative to ramp up investment and branch into new markets. As a result the company’s annual revenue has soared from about $15 million in 2006 to about $40 million today, and its estimated market share has more than quintupled.
Conlon and his team are now seeing the results. The company is branching into television transmitters, and won its first orders this month. It also won a transformative contract for digital AM radio transmitters with All India Radio, and it shipped its first transmitter on the contract this month.
“Our TV business in five years will be as big as our radio business, if not bigger,” said Conlon over lunch Thursday at a restaurant just down the highway from Nautel’s headquarters overlooking St. Margaret’s Bay. “We see ourselves as a three-legged stool , and the legs are radio, TV and more diversified projects.”
Nautel has long been known for making the boxes at the base of radio towers that send the signal up the tower to be transmitted. Without deviating too far from its expertise in “efficient high-powered radio waves”, Conlon and his team believed they could move into new markets.
They did so not so much by listening to their customers but by tapping their thorough understanding of the broadcasting market to conceive of new products that were beyond what end users could conceptualize. For example, the company decided to install 17-inch touch-control screens on their indoor installations to simplify the work of engineers, and it heard repeatedly the devices wouldn’t work in a high radio frequency environment. But Nautel believed they would work, produced working models and clients love the product.
With sales in 177 countries, Conlon said the move into television can benefit from cross-selling because so many broadcasters – especially state-owned media companies – are in both the radio and TV markets. He added that the deal with All India Radio is transformative because it sends a signal to all companies – especially those in the developing world – converting to digital AM format that Nautel is a player.
“High-powered AM transmission has always been an old boys’ club” he said. “Three companies used to get that business. We were never one of them. This contract says, ‘If you’re doing digital AM, you’ve got to come talk to us.’”
Nautel realizes that the TV business is subject to the same economic cycles as radio, so it has undertaken about a half-dozen projects that tap its core competency in high frequency radio waves, but not for broadcasters.
One project is a partnership with the Ad Astra Rocket Company of Webster, Texas, in which radio-waves are used to produce the extreme heat used in rocket propulsion outside the Earth’s atmosphere. Conlon said Nautel can undertake such work because its management and directors still think like it’s a startup.
“Being a startup is a state of mind,” said Conlon. To explain the point, he pointed to his own company’s investment program launched at the onset of a recession. “We busted our tails while everyone else went to sleep. That’s why we see ourselves as a startup.”