Tim Elliott, executive director, WAM!NET Global Marketing, is responsible for all marketing and communications activities for the company worldwide. He brings more than 19 years experience to WAM!NET, having held numerous roles in the Graphic Arts industry, including significant expertise in the industry-wide migration to digital workflows.

Since joining WAM!NET in 1998, Elliott has led the company’s marketing efforts to the graphic arts industry and, more recently, was appointed European Marketing Director. He assumed his current position in April 2001.

Prior to WAM!NET, Elliott held several sales and marketing positions during a 12-year career at the Eastman Kodak Company. While there, he was responsible for marketing Kodak’s digital proofing systems, thermal computer-to-plate media, dry imagesetting systems and color management software for printing & graphic arts applications. Elliott also served as National Account Manager and Market Segment Manager for Prepress.

Elliott is affiliated with the International Prepress Association, the Graphic Communication Association and the National Printing Equipment and Supply Association. He has spoken at Seybold Seminars, the IPA Management Conference, and to numerous other trade groups.

A California native, Elliott earned a BA degree in Information & Communications Studies from the California State University at Chico. He also holds an MBA from the Joseph M. Katz Graduate School of Business at the University of Pittsburgh.

Each quarter, WAM!NET records significant growth in customers and revenue. Overall, has it been the technology innovation, service or simple connections?

WAM!NET has seen significant growth since the company was founded in 1994. The company has produced 17 straight quarters of service revenue growth and doubled its customer base in the last year to more than 17,800.

The drivers behind WAM!NET’s growth and increasing customer demand for our managed network, storage, hosting and professional services are clear. By accessing our subscription-based services, our corporate, graphic arts, publishing, entertainment, government and healthcare customers – among the world’s largest producers of digital content – achieve secure, seamless connectivity between their entire supply chains within a fully digital workflow, effectively revolutionizing the way they produce, distribute and manage content.

The result? By outsourcing their highly mission critical but non-core competency digital content production platform to WAM!NET, customers can reduce costs, increase reliability, speed time-to-market and create new revenue opportunities. Additionally, they achieve these benefits without any worries of large capital expenditures or technology obsolescence.

Are you concerned with revenue and adoption rates, especially in the print industry?

WAM!NET has seen a significant portion of its growth come from the graphic arts industry. And, we expect continued strong adoption of our services within this market. Strategically, we are transitioning from our start-up model of aggressive market share acquisition to driving our growth by focusing on delivering increased value to our installed base of customers and their workflow partners. We also recently introduced a subscription-based, fixed rate pricing model that rewards high-volume customers and customers that use more than one WAM!NET service. The result: increased predictability of monthly service fees and a hassle-free path for customers to integrate all of their business partners into a fully digital workflow.

Regardless of market, the workflows associated with the production and distribution of digital content, such as print and broadcast advertising, video, feature films, recorded music and multimedia, web content, printed collateral, product packaging, news content, and documents – often involves collaboration among the client and their "community of interest." Such communities of interest include the client and a range of content creators, designers, ad agencies, publishers, printers and others. Through WAM!NET, these communities can collaborate efficiently and cost-effectively within a completely digital platform. This is the premise behind our overall business model.

Explain your new pricing structure.

WAM!NET recently introduced a subscription-based, fixed-rate pricing model that rewards high-volume customers and customers that use more than one WAM!NET service. The result: increased predictability of monthly service fees and a hassle-free path that allows customers to fully integrate their business partners into a completely digital workflow.

The new subscription model - with a model depending on transactions, aren’t you opening yourself up to be hurt by an overall economic downturn?

WAM!NET’s subscription and pay-per-use service delivery models ensure that our commercial and government customers receive the unique combination of managed network, data storage, hosting, and professional services they require to drive their businesses. No more. No less. This means that during tough economic times or tight capital markets, customers can establish new or extend existing networking, data storage and hosting facilities by outsourcing their highly mission critical but non-core competency digital content production platform to WAM!NET.

Furthermore, unlike companies with a single market focus, we deliver our services to customers across the graphic arts, corporate, agency, publishing, entertainment, government and healthcare markets. As a result, WAM!NET is less susceptible to market downturns in any one industry.

Your job board at the site is loaded with open positions. Is it a result of the Navy deal and are you having a hard time finding people?

WAM!NET’s management team has and will continue to manage our overall business requirements very aggressively. We recently implemented a restructuring plan to support our efforts to achieve profitability and increase shareholder value in 2001 and beyond. While decisions like these are clearly difficult, this action will result in a stronger WAM!NET. At the same time, WAM!NET is recruiting new employees to staff our growing Government Services business and we expect overall net headcount to increase in 2001. Based on our business model, market success to date and opportunities for growth, we have had success in adding required talent to our business.

Tell us about your acquisition plans. What does WAM!NET view as very important in the coming 12 - 18 months that may be better acquired than built on your own?

WAM!NET delivers to customers a portfolio of managed network, storage, hosting and professional services. Through a robust IT platform, we enable customers to achieve secure, seamless connectivity between their entire supply chains within a fully digital workflow. As we consider acquisitions of technology, partners or staff, our number one goal is to deliver additional customer value from our service portfolio.

Our primary focus in this area will come in the form of developing industry standard APIs (based upon XML) for our network and data storage services and, through partnership with third parties, we will seamlessly extend to customers a range of workflow applications. The net result is an even more comprehensive and accessible range of IT services and applications to our clients.

When does WAM!NET anticipate a profit?

Our goal is to become EBITDA positive by the end of 2001 and cash flow positive by mid-2002.

We have reported about your cash position and the need to close financing soon. Give us an update on the pending deal and will it close in July?

Many capital-intensive technology companies are feeling the challenges of today’s economy. WAM!NET has faced challenges in the past and we’ve overcome them. And we firmly believe that we will do so again. Last year, in one of the toughest capital markets in 20 years, we raised $160 million. While a challenging year, 2000 saw the company achieve significant progress and accomplishments, including:

- We grew our service revenue by 117% in Q4 2000 as compared with Q4 1999 and nearly 100% year-over-year.

- We added 8,000 new customers in 2000.

- We expanded our portfolio of services to include storage, compressed video transport and rendering services.

- We began offering managed hosting services and captured our first customer – the General Services Administration (GSA) Auction Site, which went "live" in early January.

- We launched a Professional Services organization.

- We continued our global expansion with a move into the Asia Pacific Rim.

- We launched WAM!NET Government Services Inc. and secured a tier-one subcontractor role with EDS on the $6.9 billion Navy/Marine Corps Intranet program – the largest Federal IT contact in history.

Finally, we announced in May that we currently are in the process of negotiating a revolving credit facility with a financial investor, and that we expect to complete these negotiations in the July timeframe. We expect that this investment will enable WAM!NET to fully fund its operations through to profitability in 2002.

Summarize your most recent financial filing including how WAM!NET decreased debt by some $230 million.

WAM!NET reported the following financials based on reported results in Q1 2001:

- Increasing Revenue -- total revenue increased 97% ($15.5m vs. $7.9m) and service revenue – which is now 91% of our revenue base – increased 130% ($14.2m vs. $6.2m) over Q1 2000. Compared with Q4 2000, total revenue was up 18% and service revenue was up 20%, respectively. This is the 17th consecutive quarter that WAM!NET has reported revenue growth.

- Reduced Debt – we reduced our debt position 55% ($528m to $292m) vs. Q4 2000. This significant reduction in our debt structure is a result of the termination for Winstar's non-performance of our network facility agreement with Winstar.

- Improved EBITDA loss by 22% vs. Q1 2000 (-$16.1m to -$12.6m) – this improvement was driven by continuing revenue growth, aggressive expense management and flattening COMEX costs

- Growing Customer Base – we continued to win in the marketplace and expanded our customer base by 55% (11,500 to 17,800) vs. Q1 2000.


(See Part Two) Thank you very much Tim for sharing with our members. WAM!NET has always been very up-front with communication to our community.