Is Mobilicom [ASX:MOB] a two for one deal?

If you visit the Mobilicom website you will discover a detailed, high-level, technical explanation of what the company does.

Or at least half of what they do.

What the website doesn't reveal is that the listed company Mobilicom [ASX:MOB], is virtually two companies.

I was recently invited to a briefing session with the CEO of Mobilicom, Oren Elkayam.

At that briefing the CEO explained that the part of the business they don't mention on the Mobilicom site, SkyHopper, will be the big earner.

So from a potential investors point of view, and if the CEO's prediction is right, doing your research on Mobilicom via the website wont tell you the full story.

Here is what I discovered about the Israeli based, ASX listed company.

• Mobilicom's core technology [hardware and software] allows any given team of people, the ability to establish a highly secure, fast, and very stable direct communications data network, without the need for any available infrastructure.

• Mobilicom technology works on what is called a MESH network , where each person in the network is connected to all the others, not only creating their own network, but if one connection fails, another will link up with the failed one. Read more about Mesh networks here.

• Mobilicom's proprietary technology adds high level security and also, makes the network fast, strong and more stable than others, according to the company.

Customers for this type of technology typically include government bodies like police, fire fighters, ambulance, military, surveillance etc.

While Mobilicom is still in a loss making phase overall, customers for its core technology generated revenue of $1.7m for the half year ended June 30, 2019.

But Mobilicom decided a while back to leverage that core tech into something which would allow them to target a broader market, in particular, the commercial drone market.

Here is an example of why.

At the briefing I heard a story that a drone, used by a mining company in Africa to map a possible high-value rare mineral site, was hacked while downloading its data.

The hacker, allegedly a state actor, used the knowledge obtained form the data, and bought up all the surrounding tenements of land around the original site.

I can't verify if that story is true, but even if it is not, it is a thought provoking scenario that underscores how important secure, digital communication will be as commercial drone use increases. And that is what Mobilicom's SkyHopper business is set up to capture, according to Elkayam.

The SkyHopper business provides drone manufacturers all the key portfolio elements required to build a commercial drone.

The only thing holding back the commercial drone industry seems to be regulators coming to grips with how you protect privacy, ensure safe airspace operation and prevent people being injured, or worse, killed when a drone becomes a stone.

While the commercial drone market is relatively small now, Mobilicom believes the regulatory challenges holding large-scale commercial drone growth back, will be resolved sooner than most pundits anticipate.

That is why SkyHopper has been building relationships and doing work for 62 of the world's estimated 130 drone manufacturers.

According to Elkayam, when"the gun goes off" on resolving the regulatory issues, SkyHopper and its strong presence in the drone manufacturing sector, will have an inside lane in the race to grab market share.

Revenues from ordinary activities up 24.0% to 1,768,118 Loss from ordinary activities after tax attributable to the owners of Mobilicom Limited up 10.3% to (1,417,127) Loss for the half-year attributable to the owners of Mobilicom Limited up 10.3% to (1,417,127) Dividends There were no dividends paid, recommended or declared during the current financial period. Comments The loss for the consolidated entity after providing for income tax amounted to $1,417,127 (30 June 2018: $1,284,963). Revenue Revenue from sales increased by $341,759 to $1,768,118 from the prior period (30 June 2018: $1,426,359). This increase has resulted from the following: · Growth in revenues from both existing and new customers; and · Sales of full system solutions and different market applications. Other income for the half year includes Government grants, which are up by 124% on the equivalent period in 2018. Expenses The expenses for the half year to 30 June 2019 were according to the company's expenses plan which allowed the execution of company growth and to satisfy an increase in orders forecast. Statement of Financial Position Cash reserves increased by $1,975,774 to $6,935,019 during the half year (31 December 2018: $4,959,245) following the Company's capital raising of $4 million completed during the half-year. The movement in cash has driven an overall increase in net assets of $2,333,670 to $6,628,663.