Chepstow-based Newport Networks announced on Monday that it plans to float on the stock market ahead of the launch of a telecoms product that could help make voice-over-IP (VoIP) services a commercial success.
The company plans to raise £15m by joining the Alternative Investment Market (AIM). This money will be used to support and promote its 1460 session controller, which is due to go on sale this July.
Newport Networks says the 1460 session controller solves some of the technical hurdles that are holding up the widespread rollout of Internet telephony services.
"Three years ago, when the possibilities of making voice calls over the Internet were being explored, we identified certain critical issues that would have to be overcome if VoIP were to become a commercial reality," said Sir Terry Matthews, chairman of Newport Networks.
"We are now ready to launch a product that solves those key roadblocks and which we believe will set the industry standard."
VoIP is one of the hottest topics in the technology sector at present. It allows PC users to make phone calls over the Internet rather than using the traditional telephone network, promising significant savings for end users.
But the technology has been hampered by several problems, including poor quality of service due to packet loss and delays. Many telcos have also been reluctant to embrace Internet telephony for fear of losing money on their existing voice call services.
According to Newport Networks, the 1460 session controller will appeal to telecoms operators because it addresses these issues and therefore makes VoIP services more attractive to business customers.
"This is one of the missing ingredients for realising the potential of the enterprise end-to-end voice over IP market," said a Newport Networks spokesman.
The 1460 session controller can handle up to 100,000 VoIP calls simultaneously. By drilling down into each packet of information, it can distinguish between voice, data and video traffic.
Certain packets can then be prioritised, helping the telco to provide a decent VoIP service. This also makes it possible for a telco to charge for VoIP traffic.
Another problem facing Internet telephony service providers is that network address translation boxes sitting on the edge of a corporate network often block incoming VoIP calls because they don't know which PC should receive the data.
Newport Networks says that the 1460 session controller can address this issue.
"From an enterprise perspective, the 1460 session controller is intended to fix network address translation and firewall traversal issues," the Newport Networks spokesman said.
Newport Networks was co-founded by Sir Terry Matthews and John Everard in 2000. Sir Terry in particular has a track record of success in the telecoms sector, having previously founded both Newbridge Networks and Mitel -- which were sold to Alcatel and BT respectively.