Ken Peterman: Well, I’ll tell you the convergence of Satellite and Terrestrial Network infrastructures we see as a significant opportunity for Comtech because we have technology leadership in both of those domains. They have traditionally been different domains with different devices, different frequency bands, and frankly, different players. We’ve been strong and are strong in both of those domains. And so as that convergence of Satellite and Terrestrial comes together, we see Comtech uniquely positioned to take advantage of that. That’s I’ll say that as a first point. The second point that I’ll say is sometimes the future is predicted by looking at the past. And when we saw the flip phone, which was voice-only moved to the Blackberry, what you saw is the BlackBerry took market share away from the providers that only had voice.
But when you saw the smartphone emerge, it had — it introduced the opportunity for many more applications, many more apps could run on a smartphone. So, when the smartphone was introduced, it didn’t just take market share from the Blackberry, it in fact, created a much larger market of new apps that had never been done before that created enormous customer or user value. Apps such as downloading your boarding pass, making restaurant reservations, online banking, I don’t need to list them, you see them on your phone. Okay, so in the second case, the smartphone’s introduction didn’t just take market share from the incumbent, it expanded the entire ecosystem. So, now bringing your attention to looking forward. None of us know right now, whether the convergence of Satellite and Terrestrial is going to behave like the former, where it’s going to take market share from those providers that do not provide SATCOM or whether it will create an explosion in the ecosystem of new apps and new capabilities that create an expanded market for everyone.
So, I’m not going to make a prediction, except to say that, that I think Comtech — reiterate my first point, Comtech is I think, very advantageously positioned, because our strength in both Satellite and Terrestrial Network technologies and location-based services. So, that’s one of the reasons — one of the driving reasons, we bought our siloed businesses together, so we can up-tier our capabilities and take advantage of this kind of a market inflection.
Unidentified Analyst: Thank you. Thank you so much. Good luck to you and the new team. Appreciate it.
Ken Peterman: Thank you.
Michael Bondi: Thank you.
Operator: We’ll move next to Greg Burns with Sidoti & Company. Please go ahead.
Greg Burns: Good afternoon. With the Terrestrial and Wireless segment, what is a good target for a steady state margin profile for that business?
Michael Bondi: Yes, I think historically, we saw — because it was combined with our commercial saving, you saw the EBITDA profile there. Going forward, certainly, we’re at a point where we’re seeing convergence of two types of revenue streams at the same time and the building up of the NG 911 revenue. So, right now, I’d say, initially, as we absorb those upfront costs, the EBITDA contribution will be sort of what you’re seeing right now, because we’re in between those large 5G LBS contracts. As we announced in Q4, we had a nice sized order come through, but you’ll see the revenues from that ramp up towards the tail end of this year. So, right now you’re getting a more of a mix of our NG 911 revenues. And as we as we said, flip on more PSAPs and start leveraging the infrastructure over a broader base of recurring services, the EBITDA profile will improve.
I’m not going to give a specific percentage, but it’s certainly higher than what it is right now because we’re just at the front end of those contracts.
Greg Burns: Can you give like, a range like high teens, low 20s? Like, what should investors be expecting from this business as these 911 deals scale up?
