Sierra Wireless, Inc. (NASDAQ:SWIR) UBS Global TMT Broker Conference Call December 9, 2019 1:15 PM ET
Kent Thexton - President and CEO
Conference Call Participants
William Goodman - UBS
I'm William Goodman from the TMT banking side. Thank you all for coming to our conference and the Sierra Wireless presentation.
I'd like to turn it over to Kent Thexton, who has a couple slides that he will run through, and then we will turn it over to Q&A. For Q&A, if you have any questions, just obviously submit it via the app and I'm more than happy to take them.
With that, Kent.
Okay, great. Just, obviously, our forward-looking statement Safe Harbor. Let me tell you a bit about Sierra Wireless. So, I have been CEO of Sierra Wireless for about a year and working to transform the Company from a hardware focused player to a solutions provider.
And so, Sierra Wireless has been a leader in the hardware side, modules, and gateways in the IoT market. And we have been investing heavily; acquired several MVNOs to build a complete connectivity cloud and security device-to-cloud solution. And as part of that, we are taking today's recurring revenue, about $100 million, and we have communicated on our Investor Day in June that we would look to double that within three years, so to $200 million by mid-2022, and double it again to $400 million by mid-2024. So, driving a big transformation in our business model, higher-margin, more predictable recurring revenue business, and much better for customers in providing a complete solution and helping them with their time to market, and I will talk to that a little bit as well.
So, in Q3, on the transformation side, we had a very good quarter. We have added over 300 net-new connected devices year to date and that is accelerating taking us to about 3.5 million connected devices globally. And as we attach our services to more and more of our hardware, that’s how we drive that number.
We have had a big focus on design wins. So, our profile is it takes between 18 and 24 months from a design win until we start to see strong recurring revenue from that account. So, we track the value of those design wins. We communicated that we would look to achieve $400 million to $450 million of lifetime value of deals won in 2019, and we are on track to do that.
Depending on the segment, we calculate how many years that we will be in there, but if you think of that as about $100 million of recurring revenue that we will win this year on top of the $100 million that we have, it just takes a couple years for that to start to show up. So, we are building increasing value in that pipeline of design wins that we will be bringing to market, and we remain on track for this $200 million sort of doubling of our recurring revenue by mid-2022.
We also had a big announcement of a product we call Octave, and I have a couple of charts to talk about that. But we see the industrial IoT market being slowed by the complexities of rolling out IoT, and so we have worked to solve that. Microsoft was keen and they have announced Sierra as their preferred edge partner to get edge data into Azure. And then also in the quarter, we announced the acquisition of a company called M2M in Australia. About half of their revenue is recurring, and so that helps us with scale of connectivity in the Asian market.
The IoT market has been talked about for a while, and I think that we split it into sort of technology bands here. The massive IoT, the middle band LPWA is what we really see driving the adoption in industrial IoT. So every piece of industrial equipment will be connected to the cloud. LPWA is low cost. With the wide area, it has much greater reach, so inside buildings and rural environments you get superior coverage compared to the other technology, which have been more focused on subscribers.
And on the top layer, LTE has been sufficient for most applications. 5G will add to that. So, we focus in those three areas of the stack: industrial IoT with LPWA and higher-speed applications and gateway enterprise business in the broadband IoT side.
So, we are sitting in a very robust growth market. We see the industrial IoT total addressable market for us between $10 billion and $20 billion, and about 85% of that is in the recurring side and about 15% on the hardware side.
So we have two segments that we focus on. The breaking down, as I talk about, integrated IoT is really into areas of industry. So, we call it the infrastructure edge. You can think of HVAC systems, industrial edge. We have customers like Atlas Copco that are the world leader in air compressors that run factories and the mobile edge connecting assets that are outside and mobile.
And then in the enterprise market, where we sell our more expensive AirLink gateways, I think $300 to $1,000 price tag gateway products connecting both police, fire, ambulance. We are in 50% of the top US police forces and then into a lot of enterprise environments, things like smart grids like Duke Energy. So, our industrial IoT we see, as I said, a $10 billion to $20 billion addressable market and then enterprise is about $2 billion.
Enterprise is more developed, more mature. We have a strong business there growing strongly. Integrated IoT is more early stage, so the early movers like smart meters and payment terminals in IoT are -- the next wave is coming in of broad industrial applications.
So, to drive that more recurring revenue, we have expanded our value chain. Sierra Wireless – originally we were just in the communication device layer; a lot of investment to the enterprise space with edge gateways where we've been very successful. And then through building a base with acquisitions and now organically growing our connectivity by attaching service to our devices and into the data tier by having edge analytics being able to do edge data processing to help ingest data from sensors and bring those across to the cloud, so those are the areas that we have invested in and expanded in.
And the reason why that is important, and customers here like Loomis that uses our full stack for managing their smart safes across Europe. ChargePoint uses our full stack to get information to and from their electric charging stations. Mann+Hummel is one of the mobile applications where they monitor their construction equipment, see about a $5,000 a year payback on being able to manage those pieces of equipment.
When we go from just selling hardware, and in this example, a win from last quarter, about $1 million of hardware but drives about $2 million a year of recurring revenue. So that recurring revenue, after three years in service, you are getting $7 million from a hardware-only business that would have been $1 million, a more differentiated and much higher margin. So, that is what we are seeing in our design wins: much improved business model.
I get asked sometimes as well about why buy connectivity from Sierra versus a carrier. And so, we are delivering a lot of benefits to our customers. So, a global machine maker that is working to get their equipment online, gets the data to the cloud. First of all, we integrate our connectivity directly into our module. So, there is no discrete sim card required. From a logistics perspective, whether the device is showing up in Morocco or Mexico, it automatically connects to one of the 200 countries where we have the Sierra Wireless global connectivity network.
With smart SIM, we typically have multiple carriers per region. So, in Europe, maybe in France, we have Vodafone on a wholesale basis. We have Orange on a wholesale basis. We have Bouygues on a wholesale basis. So, when you are in a factory, which by virtue of being in a building means there is probably some compromised coverage, our smart SIM selects the strongest signal strength. So, it is always better than any single carrier solution because we have the choice of multiple carriers.
Thirdly, because we integrate the hardware and the connectivity, we can see security from a hardware perspective, and we can also do anomaly detection from the transport layer. And so, we have a 1 plus 1 equals 3, so offering a superior security solution for our customers.
And finally, we are a single expert supplier. So, we have our global network operating center in Atlanta; it monitors all 3.5 million and growing of our devices. And so if a customer has put this puzzle together themselves, bought a module from somebody, put in different carrier SIMs around the world, have procured their own software platform, and if a device isn't reporting data, they have a challenge to troubleshoot that themselves. We proactively manage all of our devices out there. So it has been a strong story, good customer response to being able to get the full stack from Sierra.
And then to take that one step further, we launched this product Octave that I mentioned. And what we have done with Octave is we have an API to common sensor feeds out in the market. What has slowed down the adoption of industrial IoT is that enterprises have found it difficult to do this work with the need for embedded software engineers, programming, on an edge device, which sensor data, what frequency, how do you manage it. And then having to have APIs on the cloud on the other side.
So with Octave, what we allow them to do is manage the edge from the cloud. So instead of having to have an embedded software engineer, you can program the device from the edge. My favorite example is a major water company. They just signed up with Octave; had done a proof of concept. They took one of our devices, they UPSed it to Mongolia, they hooked up their water purification plant in Mongolia. And within two days, they were getting their edge data back to France. So instead of a multiyear rollout and a lot of things, we have simplified that whole process.
This is what got Microsoft excited about partnering with Sierra. Forrester did a research paper and said that Octave increases time to revenue by nine months, which is dramatic in this space, and reduces total project costs by about half. So that is the work that we have been doing with edge processing to speed the time to market.
And with that, Microsoft announced in June that they have selected us as their preferred partner for the edge. And we will be launching into their whole ecosystem, so the 12,000 Microsoft global Azure salespeople can be selling Sierra products from second quarter of 2020 as we get fully integrated into their Azure platform. And their Azure customers when they connect Octave the data will show up automatically into their Azure instance. We will connect data to any cloud environment, but it is going to be most advanced with Microsoft and gives them something to get more data into Azure, which is how they are very good at making money.
So just pictorially, what I said is the growth of our recurring revenue, the acceleration effect is from what we refer to as the flywheel. So when we have every Atlas Copco air compressor coming with our end-to-end service package, we get that recurring revenue. Each year as they add more devices, it increases our recurring revenue picture. So without increasing our customer count, our revenue is growing. And while we are out expanding into industrial IoT, we get that additional acceleration.
So we see this acceleration going. Our design wins in 2019 on top of the $100 million of recurring revenue we already have fuels most of that number that you see here by mid-2022. Our continued design wins drive us towards the $400 million number.
So a few customer examples just to show the power of what we are bringing on. ChargePoint, when they first rolled out their charging stations, often used WiFi. They had a lot of issues with it wasn't a managed connection. I have a Tesla and when you go to a ChargePoint station that's on a WiFi, often you can't charge because it is off the air.
So they are rolling out the Sierra end-to-end solution. It is our module, it is our connectivity, it is our device management and security. So every time they roll out a station with one of our modules, it picks the strongest signal strength of what is available at that location. And it reports the data securely up to the cloud so they can manage all of their terminals.
This is an example of our time to market as well. We won this business at the beginning of the year. They are just starting to roll out in numbers now. In two years, it starts to hit quite a volume. They ultimately talk about having -- their press says that they plan to have 2.5 million charging stations by 2025.
There's two charging stations per Sierra Wireless module, 71.25 million charging stations. And so we look to partner with them and provide them that full end-to-end solution as they expand. In the numbers that I talked about in terms of design wins, we only have a small number in there compared to the $36 million of annual recurring revenue that would add up to if we were servicing all 2.5 million stations.
Another great example is Veolia. They are a big multibillion-dollar European water purification customer. I mentioned how they shipped a unit to Mongolia, and with their team over there being able to just plug into the API mod bus sensors that they had on their equipment were able to very quickly get product back. Were impressed with the ease of use. They were expecting it was going to take a long period of time to get that set up. So two days massively exceeded their expectation. Our global network, pleasingly, works in Mongolia as well.
And for them, they are doing predictive maintenance on their water purification. So they are getting sensor data from all of their expensive equipment that they have out in the field. As they get more and more of that data, they can use their machine learning and AI to be more predictive on what maintenance they need to do. And they love to sell services to customers off of that data.
And the third one I mentioned before was Atlas Copco. So these are big industrial air compressors. Many factories run on compressed air. If the air compressor goes down, the factory goes down. So Atlas Copco wanted to be able to implement the monitoring of all of the major sensors from their air compressors. So time of use, heat, vibration, air humidity levels, etc., that all had a factor on the performance of their air compressors.
And so we have been shipping product to them for a while. They put one of our gateways in every one of their air compressors and bring all of that data back to the cloud for analytics. They are not only able to cut their cost down because they are only sending out their staff for predictive maintenance when the machine needs it, but they are also selling guaranteed uptime programs to their customers. So they are both saving money and making money by their industrial IoT application.
So I will just summarize then on this slide here. So Sierra Wireless is a leader in shipping IoT modules. We are now integrated; started at the beginning of this year. And every new module that we deliver is now with our embedded smart SIM connectivity.
Continuing to drive automation. So Octave is a much better way for customers to quickly -- so greenfield customers that are not in the IoT space, Octave help securely with edge intelligence bring that data in. And then partnerships. I mentioned Microsoft and other partners are looking to get involved in the ecosystem. An important way to drive this to the scale that the earlier chart talked about with expectations in IoT. And then our delivery of all this drives our recurring revenue and really shapes the future of where we are going at Sierra Wireless.
Q - William Goodman
Perfect. So, I will kick it off with some questions, and as mentioned before, if you have any questions that you would like to ask, feel free to submit them via the app. Maybe just taking a step back to the overall IoT ecosystem, clearly, I remember whatever it was, 10-plus years ago, it used to be called M2M. It's been developing for years. Where do you see us currently in the cycle in the development within the broader IoT ecosystem?
Well, it's sort of a segmented answer to that. So, I think that there was early mover areas -- like I said, smart meters -- because the payback cycle was so rapid where you could get rid of humans having to go measure a meter or payment terminals where you could be processing cards, so those segments have gone to strong penetration levels already.
Then, I would talk about the industrial gateway. So, that market is somewhat more mature, but you can think backup systems in retail, you can think about smart grid areas where being able to get connectivity, and data is crucial.
And I think the industrial IoT market is the area people underestimate in terms of how large that market is, and it's very early days. Most pieces of industrial equipment are not connected today. So, we have been bringing things online in this world. We are just beginning to bring the industrial infrastructure online.
And so that is going to be the big growth opportunity that drives the LPWA numbers that we see, and we think that that the way to do that is with a full solution, not just providing a piece of hardware and let the customers figure it all out.
Right. And then are you starting to see those types of enterprises embrace the benefits of what it means to have connected devices? Have you seen in the full IoT solution, I mean, are you starting to see the buying pattern change, the behavior change whereas before it may have just been effectively speaking to a wall, now it's more of a two-way dialogue?
Yes. I think that for Sierra Wireless, part of the journey as well as putting all the assets together to provide a full solution has also been to get the sales force and partners to be able to sell that. So, we are seeing -- the design wins we have this year are a testament to the fact that we are seeing that. I always like to say that dogs like the dog food, so as we get out there to talk to people about the full stack solution, they are seeing the benefits.
And we have done studies and read others where Bain had a big study on preventative maintenance, why is it slow, is that the complexities today are causing about three-quarters of IoT projects to be delayed or canceled, and so solving that complexity with a full stack solution.
Our CTO talks about the cloudification of IoT, so back a decade ago, if you wanted to stand up an IT implementation, you had to have your own clean room, you had to buy servers, you had to buy software and load balancers, and it was complex, and you would only do that if you had that sophistication and clear business case.
And then as we move to the cloud and you can get that by the drink whenever you want without any of that complexity, the applications market took off. And we think we are at that stage with IoT.
That's helpful. I mean, as you talked about the transition from more the module base transaction base versus true recurring revenue, I mean, what has been some of the efforts done, whether through partnerships, reorienting the sales force to help drive that forward, where do you think you are from an internal standpoint? Obviously we saw the financial goals, but where do you think you are internally from making that pivot?
Being an engineer by trade, I say the first derivative has changed. So what is coming in has changed. So we are seeing our solutions efforts take hold. So we will have tripled our design wins of solution revenue this year. Also tripled our pipeline, so the future looks good as well. And the Microsoft partnership I think is the best ecosystem partner in the world and so very pleased to have reached an agreement with them. They have a substantial partner ecosystem: about 30,000 partners worldwide. They brought us into their strategic partner circle, which is for their top 100 partners. And so I think this app program rolls out during 2020, we will see that have a big impact.
And so a combination of what we are doing as our direct sales force and with our VARs, and then with big partners like Microsoft and others, we are on the change curve with that.
Thank you. And speaking of the Microsoft partnership to create the full stack solution, what has been the reaction post the announcement? How has that played out? And then talk -- expand a little bit more on how different differentiating is this?
Well, I would say two layers. First of all, to leverage a partner ecosystem, you have to have a pretty mature easy-to-use product. Having sold through partners before, if you expect them to do too much, it doesn't work. So Octave is the right product for us to work with partners on because we simplified the whole IoT journey.
For customers, it's an API set to sensors and so -- and with that, our edge processing takes the sensor data down to events, which they decide from the cloud the frequency of those events that they want. And we just charge them per event. So there is no megabyte pricing; there is no how much is this going to cost. The business case works cleanly. So that simplicity allows a partner like Microsoft to sell it.
When we first started talking with Microsoft, they had a view that the edge was what we call the thick edge, like computers, where they could download parts of Azure software into a customer prem. But as we started talking about industrial IoT and Octave, they said yes, we don't have that, we don't have the expertise, and that is not where we live. Let's do a partnership.
So internally, they have gotten quite excited as we have been working with them. And so there is a number of gates to get everything into the Microsoft billing system, etc., but it is going very well. And I expect we will see good traction as we get rolled out to the sales force later this year.
That's great. That is great. And what are the implications of this? You mentioned before just because you are now partnering with Microsoft, does it mean you can't work with the other big cloud providers. How do you think about that? Do you take the partnership you are doing with Microsoft and expand it to Amazon, Google, etc.? Or do you feel given where you are at this stage, it is just rolling out with Microsoft. Let's focus on getting that right and really --.
So we will deliver a customer's edge data to whatever cloud environment they are in, whether it is Azure, AWS, Google Cloud, or a private cloud scenario. What we are doing with Microsoft is we are completely pre-integrated. So it's just a faster time to market and it will sit within the Microsoft Azure marketplace. So any of Microsoft's salespeople or their partner network can sell Octave. So that is the integration that happened. But if you are a customer that has all your enterprise data going into AWS, we support that fully.
I think other partnerships will be in partners that can take advantage of the edge data and that they can add value to it. And we can enhance their ability to create value and revenue by simplifying that edge data journey.
Thank you. Maybe switching gears a second to Octave. Maybe just to help us all fully appreciate how powerful a solution this is, as we think about the customer set who you previously could have gone after versus now that it is a full stack solution, we saw some of the examples. Could you breathe a little bit more life into the use cases you can now penetrate versus 12, 18 months ago pre-Octave it may have been a little bit more difficult to? And how that expands the TAM?
I would say that previously, the IoT industry and Sierra as part of it waited for customers to figure it out, come out with an RFP and respond to that RFP. And with Octave, we are now able to much more proactively go to industrial IoT companies that are starting to think about how would we get edge data and what do we do with it. We can very rapidly go to proof of concept. So before, where it may have taken a year to get a proof of concept, as I said with my Veolia water case, within two days they were getting edge data. So that is just a dramatic improvement in terms of being able to start to gather that edge data. And then that allows them to complete their internal business cases to go out and decide they are going to roll out.
So it is changing the whole pace at which companies can decide to adopt IoT. And we will sell to a customer whatever flavor they want. So they may just want to get our smart SIM product and connectivity because they have more experience with doing embedded system programming. It's a competency of the company; we can cover that. But particularly ones that are more greenfield and they are trying to expand into IoT, then we think that Octave is going to be a game changer and opens up that industrial IoT marketplace very wide.
Thank you. Moving on to your recent acquisition of Australia's M2M Group, could you just tell us a little bit what was the sort of acquisition rationale for that one? How has it been playing out? Maybe let's start with that. And we will take it elsewhere.
Sure. So previously Sierra Wireless had acquired two MVNOs in Europe -- Maingate and MobiquiThings -- to get scale with the European carriers that were broad set. And in the connectivity game, there is a chicken and the egg: you need to have enough traffic to get good rates from the carriers and you have to have good rates for your customers to get to scale.
So some M&A in the connectivity space got us to scale in Europe. We did two acquisitions in North America: Accel networks and Numerex. And that has given the scale in the North America market. We sort of had Asia-Pac as a lower priority, and M2M was a company that was buying -- distributing AirLink gateways for us. And as they expressed interest in a potential exit for their founders, a deal came together pretty rapidly because they are highly integrated to what we do already.
There is no mystery there. We know them; they know us. And they have been tremendously successful in growing their recurring revenues. So they have expanded a strong partnership with Telstra and other carriers in Australia, it's a market we didn't have a volume in. So my chicken-and-the-egg example. And so we talked to Telstra about this acquisition. They were very supportive of what we bring to the combination of Sierra and M2M.
And it helps us in the whole Asia-Pac region with more traffic. So it was sort of ahead of my schedule of adding more connectivity in Asia-Pac, but very pleased to have it.
Perfect. Thank you. And so now given that deal, do you feel like you are comfortable with where you are at from a connectivity standpoint? Or do you feel additional scale could be helpful?
So you know, I will fall on my sword a little bit because I said we didn't need to do anymore. I have broadly been referring to we're complete in Europe and North America. We don't need more scale in those markets with 3.5 million connections already. And Asia-Pac was later on my agenda, so that happened earlier. So we don't have any requirements to push deeper into that. We have solved an issue we had in Asia-Pac. And if there is a country we start to have particular success in and we want to push deeper on the connectivity side, I will never say never, having been wrong once.
But I think that future areas of interest for us as we grow our 3.5 million connections to a much higher scale number and we are the data path for a lot of information, I think there will be lots of stories that can add value to our customers beyond having another connectivity deal.
And then as you just think about the development of the IoT ecosystem, do you see customer behavior pattern -- for example, the reception to the Microsoft announcement, Octave -- is there a difference geographically that you are seeing it? Are some areas, some geographies early adopters versus others or is it pretty ubiquitous throughout?
Well, the markets are different, for sure. In Europe, I think it's harder for companies to deploy because there's so many carriers. So that adds more complexity, so that helps us sell. When there is a global machine maker and we can deliver connectivity to 200 countries, that's very powerful.
In the US, I think that the enterprise marketplace is more mature because it's big national carriers, depth of LTE coverage. And so that's an area of focus and we may provide connectivity in that. We may just provide software platforms to help manage networks to our enterprise customers. And then Asia-Pac is the widely diverse market. I served that market when I was with British Telecom and it -- you can't think of Asia-Pac as one region. You can with Europe and definitely with North America. So Australia and Southeast Asia will move in one realm. China is completely different. Japan and Korea are different. So we are at different stages in those markets.
Helpful. And then along those lines, do you see the competitive intensity and who you compete with also different at this stage across geographies? Or are you seeing similar players across the globe?
It's pretty global now. But I think that what we have done with bringing together device connectivity platform and security, we are highly differentiated there. Nobody else has pulled all of those aspects together. The connectivity side is hard, but I would say hard is good because it's not easy to follow. So we are continuing to try to expand on that lead.
Helpful. That is helpful. And then when we saw the chart, I think people may have been surprised at the size of LPWA versus 5G. Overall, how do you see 5G impacting this sector?
So our chart was on unit volume, and Qualcomm and others may put up on dollar volume and look dramatically different. An LPWA module is less than $10 and early 5G modules are going to be over $200. So there's a dramatic difference in cost. But I think that we view the value in the recurring revenue. That is where customers see value: it is getting their edge data into their environment. So what does it cost of them per month, per year to be able to get that. And LPWA is going to be the right bearer to drive that. 5G will have early on some very specific applications because where you need high speed, low latency, and so we see -- we have a number of 5G design wins already. And it's typically into like high-speed routers and those sorts of applications, where that is going to be important for our customer.
But in terms of mainstream industrial IoT, very few use cases today that need that sort of speed. And 5G, especially as you get to the millimeterwave deployment, it is in building, penetration is going to be approximately zero. So for an industrial IoT application, you have to go private 5G network to be able to have that covered.
So that is going to take years to get there. Cellular is always showing it is a bit of field of dreams: build the capacity and the applications will show up. We couldn't have Uber and Lyft today if we didn't have LTE. It doesn't work with 3G speeds to do that sort of data density to provide that service. And so I think a lot of the services that will exist in 5G haven't been invented yet. And so we will sit here in five years and talk about how could we possibly live without 5G. But today the use cases are narrow.
Helpful. Thank you. And as we talk about -- when you talked a little bit about the M2M Group's overall taking a step back, help walk us through your M&A strategy. I mean, how do you look at it going forward?
Well, our focus right now is to organically grow our connected base. As I said, we are at 3.5 million subscribers and that is growing very nicely and we expect that to accelerate. And as that happens, leveraging the assets we purchased, the organic side is going to create more value in our business and create more opportunities. So a bit heads-down on organic growth right now, and a year from now, it may be a different story.
Fair. And then sort of tying into that and given that, we could probably predict the answer, but we will ask it anyway is how do you think about capital allocation over the next 12, 24 months?
Well, I think that I have led a lot of business optimization work in the last year. So we have announced we are cutting $40 million to $50 million of cost out, have closed 12 sites. I think that the business through previous acquisition efforts had become a little bit spread across too far and too high cost. So been working to focus on that so that then -- and our investment where we have been saving places and then investing in our services layer. So in our solutions and in our go-to-market sales capability for solutions. So that is from an investment perspective has been the main focus.
CapEx is low in our business, so there has been a bit more CapEx this year as we have scaled up some of our manufacturing plants from a test equipment perspective and got 5G test equipment. But we will be back to more of a normal cadence as we move forward from here.
Thank you. And then sort of lastly, as we -- everyone fully appreciates -- what headwinds are you seeing in the business, particularly as we think about carrier technology as some of your peers have been more adversely affected with network sunsets? I mean, how does that impact your business? How are you positioned for those?
Well, one aspect is carriers turn off 2G and 3G and how that affects different players in our industry. So we see more opportunity than risks in that side. So of our base of connected customers, our 2G base is relatively small. Where we sell gateways, we have quite a number of customers that are on 3G gateways and that will drive an upgrade cycle as the 3G networks are sunset. So the carriers have delayed that, which has delayed some of our gateway demand, but we will see that in 2020 as that sunset approaches. So really more upside for us on upgrade cycles. And we are actively managing the customers that we have on 2G connectivity to move them to 4G. And so those two efforts are underway.
I appreciate it. Thank you, Kent.