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July 24, 2008
CEO Updates Shareholders on Rollout of Wireless Consumer E-Transaction Solution
Alternet Systems, Inc. Announces Mass Transit Wireless E-Ticket System Anticipated To Process 24 Million Passenger Transactions in First Year of Operation
VANCOUVER, BRITISH COLUMBIA - July 24, 2008 - Alternet Systems, Inc. (OTCBB: ALYI) today released a letter to shareholders from CEO Henryk Dabrowski detailing the Company's rollout of its wireless consumer E-Ticket solution for the mass transportation market. Prepaid fare collection, commonly known as "E-Ticketing" is becoming an industry standard in the mass transportation marketplace. Alternet is initially targeting the mass transportation market in Central and South America and anticipates establishing a recurring revenue foundation with its E-Transaction solution by processing 24 million E-Tickets within the first year following the solution rollout. Alternet has built a comprehensive wireless E-Transaction system that can support electronic payment transactions for multiple industries. The Company plans to subsequently rollout its wireless E-Transaction system in the financial, telecommunications, and utility industries.
Alternet recently acquired Tekvoice Communications to augment the internal development of its wireless consumer E-Transaction solution. Prior to the Tekvoice acquisition, Alternet was a development stage business. Through the Tekvoice acquisition, Alternet has gained a proven billing solution to compliment the Company's overall wireless E-Transaction solution and a customer base with approximately $3 million in annual revenue supporting clients in the execution of periodic E-Marketing campaigns.
Today, the Company's transaction related services include mobile (cell phone and PDA) transactions, utilities prepayment, fare collection and a mobile point of sale system, which provides Alternet with a broad service offering for expanding into additional markets.
Alternet CEO Henryk Dabrowski has released a letter to shareholders elaborating on the Company's E-Ticket solution, the overall E-Transaction marketplace and specifically the mass transportation opportunity in Central and South America. The letter is included in its entirety below:
Dear Fellow Shareholders:
I am enthusiastic about the Company's progress in 2008. Since I joined Alternet at the end of last year with the acquisition of Tekvoice, Alternet has made substantial advances toward building a robust wireless E-Transaction solution. Alternet's acquisition of Tekvoice brought some important technology into Alternet's wireless E-Transaction solution and since then the Company has been able to augment its wireless E-Transaction solution with additional technology enhancements gained through strategic partnerships. Now the Company is poised to close on its first substantial implementation of its wireless E-Transaction system. Our initial sales concentration has been on the South and Central American mass transportation market and our first breakthrough is imminent.
E-Ticketing Solution Augmented by Chinese Partnership
In order to bring an industrial strength E-Ticketing solution to market in Central and South America, Alternet has formed strategic partnerships with two companies in China that already have extensive experience in the mass transportation market. The partnership with Tianjin IC Card Public Network System Co., LTD. and TransTech Sino America Tianjin not only enhances Alternet's E-Ticketing solution, but expands its mass transportation wireless E-Transaction solution to include fleet management, bus monitoring, and fuel dispensing.
The E-Transaction marketplace is thriving today worldwide and is expected to see continued rapid growth. As previously mentioned, Alternet's acquisition of TekVoice has given us a market ready, E-Transaction solution to deliver to customers worldwide. The opportunities surrounding E-Transactions span virtually all business sectors and are currently sought by public and private companies, as well as governments. Alternet has chosen to focus on four main sectors; mobile transactions, utilities prepayment, fare collection and mobile point of sale systems. These technologies have numerous benefits for both companies and their customers, including improved cash flow, reduction of bad debt, and higher levels of customer satisfaction. Additionally, in emerging economies where many residents only have basic banking accounts, they are offered the flexibility of paying their bills on a schedule that fits their needs. They can pay as much and as often as they choose.
Alternet is currently concentrating on implementing these services for clients in Latin America. To date, the Company's primary focus has been on prepaid fare collection for mass transportation systems.
Mass Transit in Central and South America
Latin America, home to 10% of the world's population, is the second fastest growing region in the world, with a growth rate of 9.1% annually. A large portion of the population in Latin America uses public transportation for their daily commute. In Guatemala and Curitiba, Brazil, nearly 70% of residents use public transportation. Mexico City has the fifth highest ridership in the world, serving nearly 1.5 billion passengers in 2006. Serving such large numbers of passengers efficiently can be a difficult task.
I am sure everyone is aware of the continuing rise in fuel costs. The crunch is being felt by individuals as well as those operating mass transit systems. In order to keep their services affordable, governments are looking for solutions to operate as efficiently as possible. To date, prepaid fare collection has mainly been implemented in the largest urban areas in Latin America. By 2006 Sao Paulo had already issued 8.5 million smart cards for prepaid fares, making it the second largest smartcard solution in the world. Prepaid transportation was a major part of Chile's renovation of the Santiago mass transit system. Today, riders can refill their fare cards at bus stations and shops located throughout the city.
There are roughly 50 cities in Latin America with a population of at least one million. Prepaid fare collection improves cash flow, operational and administrative productivity as well as boarding times, in turn offering reliable transportation for residents, many of whom are dependent on public transportation systems.
A Recurring Revenue Foundation
Alternet today, by way of the Tekvoice acquisition last year, has historical revenue of approximately $3 million annually. That revenue is derived through the sale and management of electronic marketing campaigns. The campaigns have a beginning and an end. Accordingly, our current revenue fluctuates throughout the year though we are able to sustain repeat clients and grow revenue year to year. The imminent breakthrough in E-Ticketing will transform our revenue model into a recurring stream. We are excited about the opportunities Alternet has in Latin America, not only in prepaid fare collection, but other electronic-based transaction services. Business development is well under way and we look forward to sharing our progress. Please watch for announcements in the near future, as we look forward to sharing our progess in the region with you.
Henryk Dabrowski, Chief Executive Officer
Alternet Systems, Inc.
About Alternet Systems:
Alternet Systems Inc. (OTC BB:ALYI.OB - News) provides: telecommunications services; education and health-care application software and systems; and electronic transaction platforms for the mass transportation and utility markets. Alternet Systems Inc. is a U.S. corporation with offices in Miami, Florida and Vancouver, British Columbia, Canada.
For further information about this news release or the Company, contact: Patrick Fitzsimmons (866-608-2540) or visit Alternet's corporate website at www.alternetsystems.com.
Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the Company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
Contact: Alternet Systems Inc.
Robin Bjorklund or Patrick Fitzsimmons
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