Friday, March 25, 2005

SourceCorp

Does anyone have any more information on this SourceCorp stuff? You've probably read about this as it has unfolded, but it seems that one of its subsidiaries overstated their earnings for a period of time in 2003 and 2004. What makes this intriguing is that apparently this subsidiary was a company SourceCorp had required and its earnouts were based on its revenue. So, the company inflated the revenue and increased their earnout payments. Needless to say, now that all of this has come to light, SourceCorp execs are a bit upset and they are trying to collect like $10 millino worth of earnout payments they've made to these guys.

My quesiton is who are these guys? Does anyone know. SourceCorp doesn't seem to name names in its SEC filings, but I'm sure somewhat out there knows.

To SoruceCorp's credit, they seem to have handled the whole situation rather well, and here's hoping they get their money back. Of course, that is assuming they are in the right... Anyways, here's a link to the transcript of a recent conference call they did discussing their business model and the revenue restatements. Sounds like their going to do pretty well despite the recent financial restatements.

Of course, looking at the history of SourceCorp competitors like Lason and ImageMax, service bureau financial restatements have proven disastrous for service bureaus in the past, but once again to SourceCorp's credit, it appears they have nipped this thing in the bud early enough, where there won't be any more ramifications. Also, of course, unlike the Lason problems, which started at the top, these problems appear to be more of a rogue happenstance.

Cheers.
RG

Thursday, March 24, 2005

Pixel Answers

Here is Pixel's response to our comments about Mark's Esdon's leaving the company

"Over the years we have created a strong team to support our ISIS and Pixel Translations customers. After many years in this field, Mark Edson has left Captiva to pursue his interests in a completely different field. Despite Mark’s departure, we remain on track with our development plans, and look forward to continuing to provide outstanding support to our customers going forward."

After chatting with a few VARs about it at the recent Kofax reseller conference, ISIS remains a very relevent standard especially in higher-speed applications. We don't think it will be going away any time soon...

Tuesday, March 22, 2005

Don't forget about Pixel

Our apologies to the hardworking people at Pixel Translations for forgetting about you when we listed leaders in the toolkit market last issue...

On a related note, we understand that Mark Edson has resigned as the CTO of Pixel and at lesat one scanner vendor we talked with seems concerned. Mark was apparently a major part of the braintrust behind the ISIS drivers which have made Pixel tools' so popular over the years. A few years ago, after Pixel co-founder Steve Francis got out (for the first time), there were a lot of complaints about the service the company was providing regarding ISIS drivers. Scanner vendors were having problems getting their drivers done time - this was a major reason the TWAIN high-speed scanning initiative was launched. TWAIN of course had been primiarily a photo-imaging driver before that. TWAIN has evolved considerably over the years, and many people, especially in the workgroup segment of the market swear by it. However, ISIS still remains a popular driver in higher speed applications. We wonder how service will hold up now that Edson, Francis, and Pixel co-founder Johannes Schmidt have all left the company.

Tuesday, March 15, 2005

This week's news

Posted a number of press releases today.
The most interesting of which is probably Sony's and Intradyn's e-mail archiving system that starts at just over 10 grand. This is the type of thing we've been calling for for the SMB market. I hope to catch up with them later in the week and discuss the details. Like, how do you determine what to archive and what not to with as little disruption to the work process as possible.

Another interesting release invovles Top Image Systems', which had a huge fourth quarter.. Things seem to have turned around for TiS, once they started focusing on the invoice market. And make not mistake about it, automated invoice procesisng it hot right now. Take a look at recent wins by Captiva and Anydoc that are evidence of this. ReadSoft also finished 2005 strong both in North America and worldwide and most of that was driven by Invoices sales. More on that in our next issue.

Finally, eCopy officially announced its VAR program. We plan on having more on eCopy's growing channels when we visit their partner confernece in April.

Tuesday's always a busy day for news.

Cheers.

RG

Friday, March 11, 2005

Final analysis on Verity/Dataintro

I had to cut this excerpt out of this week's newsletter to make room for the late breaking Scan-Optics news. Seemed like a shame to waste it, so here is my final analysis on why the Verity/Data intro deal was such a good fit:

Adobe, which competes with Verity in the e-forms market, introduced its own PDF417 technology for PDF forms last year at AIIM/On Demand. The Dataintro/Verity deal comes two months after Adobe announced that Kofax, which competes with Verity in the document and data capture market, would begin marketing LiveCycle Barcoded Forms, through its reseller channel. As 2D bar coded forms are often described as a transition technology between paper and electronic forms, both the Adobe and Verity camps now offer a complete spectrum of technology for capturing data from forms.

Thanks.

RG

Mavel resigns from Scan-Optics

Don't read too much into Jim Mavel's surprise resignation from Scan-Optics yesterday The official reason being given is "personal reasons," which is usually not a good sign. Throw on top of that the fact that the resignation came in only a couple weeks before the comapny's scheduled earnings release and it ocurred on a Thursday night after business hours, and we smelled trouble.

Scan-Optics execs however, did a good job at damage control and Mavel close friend and long-time co-worker, Scan-Optics, VP of Sales Dick Goyette called us to assure us things are going well as the long-time scanner vendor. Goyette, in fact, told us the company had just completed one of the most successful quarters in the company's history, including landing a $2.7 million deal with the South Carolina Department of Revenue and signing up UK distributor Headway and Beltway-based Promark to distribute its SO Series of scanners.

Fourth quarter numbers are due out March 31, which may or may not shed some light on the reasons behind Mavel's resignation. We will say we always enjoyed working with Jim over the years and found him an interesting interview with an engaging personality. We will miss having him at Scan-Optics.

He is being replaced on a temporary basis by a long-time board member andt he company has also hired a new COO to replace Michael Villano who died last year.


RG

Thursday, March 10, 2005

Pitney Bowes CEO Discusses Mail

Here's an interesting article where Pitney Bowes' CEO seems to be saying that the increasing use of e-mail is actually going to increase the use of traditional mail. That's great news for document imaging vendors if it's true. For some reason, I have a hard reason believing this, as I think once people really figure out how to best use digital documents, there will be no turning back. For example, I have probably written one or two checks in the past year and have no intention of going back to paper payments. But heck, Pitney-Bowes needs mail so let them believe their going to have it.

Wednesday, March 09, 2005

Verity-Dataintro

Check out the latest news from Verity, regarding its partnership with Spanish developer Dataintro. We featured Dataintro in DIR last year. They developed 2-D bar code technology for forms, similar to the stuff Adobe is offering. I'm not sure what the patent issues are regarding all this stuff, but bascially both products enable users to fill out forms on-line and then have the data they have entered encoded in a 2-D bar code that appears on the form. This way, users can print the forms and the 2-D bar code can be scanned to capture the information - elmimating the need to submit the forms electronically, or apply OCR/ICR. It's reportedly very accurate. It has primarily caught on in tax applications so far, where for a variety of reasons users don't/can't submit their information electronically. The IRS, in fact has a big project going with Adobe.

What is intriguing about the Verity/Dataintro deal is the bedfellows. Dataintro has had some success so far primarily marketing the stuff on its own in North America, but Verity will definitely provide it with increased presence. It's an interesting fit for Verity because Verity seems to be marketing the product as complementary to its e-forms offering, which is exactly how Adobe is marketing it. Of coruse, Verity could also choose to market it with its traditional paper forms processing software. So, in essance, Verity has kind of a triple threat here. They can process your paper forms, they can process these hybrid 2D-bar code forms - which most people consider a step on the ladder toward e-forms, and they can market the e-forms solution. It's an interesting value proposition. We'll see how it develops.

It's also interesting because Adobe is actually a former investor in Cardiff, the forms processing/e-forms company that Verity bought and for a long time, it was rumored Adobe was going to buy Cardiff. Now, Verity has become the first vendor to take on Adobe head-to-head in this emerging 2-D bar code space. Probably not a big deal, but interesting none-the-less. We've also heard a rumor that Scantron, one of Verity's biggest forms processing resellers has dropped the Teleform product line, so this deal with Dataintro is probably part of slight rebound strategy. Oh yes, and somewhere in here fits the fact that Kofax is reselling Adobe's 2-D bar code products and Kofax parent Dicom is another former Cardiff investor...

Look for more news on this emerging 2-D bar code technology. It's one of Harvey Spencer's favorite topics. It will be interesting to see what other types of end users start to adopt it.

Cheers.

RG

Monday, March 07, 2005

Google/ScanSoft

Check out my quote in the lastest press release from ScanSoft regarding its relationship with Google. Pretty interesting announcement considering ScanSoft's long relationship with Microsoft. I was under the impression that Microsoft and Google were fairly big rivals and that Microsoft is also competing in the desktop search game. Is there another shoe to drop in relation to this story?

Thursday, March 03, 2005

PC Expo Veteran takes over for Randall

Christina Condos has been named Brian Randall's replacement as the organizer for the AIIM/OnDemand Trade Show. Condos most recent position was the executive director of CMP's Entertainment Technology Group.. Condos main qualifications for her current position, however, come from several years as show director for CMP's Technology Exhibition Week New York, or TECHXNY - better known probably as the show formerly known as PC Expo. Here's a brief profile of Condos. Advanstar Technology Group VP and GM Kerry Gumas seems pretty happy with Condos' hiring. He notes that she brings experience with On Demand to the table as well. He also noted that the rest of the AIIM/On Demand team remains in place and that the marketing efforts to sign up end user attendees are going well. He promised to share some preliminarty numbers with us in the upcoming weeks.

Oh yes, Gumas told us Condos has also been named Show Manager of the year by the International Association For Exhibition Management.
It sounds like Condos brings a good resume to the table, which she will need to manage the growing AIIM/OnDemand show, which also conincidiently is in some tranisition as it moves to a new city. Based on what we've read about Christina, we are confident she can get the job done and look forward to continuing to grow with the show.

Did we mention that we think the education tracts this year look great and what a great job AIIM has been doing with education programs in general since it sold the show.

Cheers.

RG

Wednesday, March 02, 2005

AIIM E-mail study

Did you see the new survey that came out today from AIIM. They surveyed like 1,000 businesses aboout their e-mail, IM, and Blackberry and other types of messaging habits. No secret that these types of communications are growing. What remains a secret is how to properly manage them. One of the interesting stats I saw was that 86% of these organizations tell users how they should use e-mail, only 39% say how they should be retained in a records management environment. Is there a good e-mail records management system out there for general business - I haven't seen it yet. This is where I think all our IDR/Forms processing technology is going to end up going.

There is a growing amount of potentially hazardous e-mail floating around out there and nobody has a good track on it. E-mail use is going to decline and we've got to find a better way to deal with it.

When I give my seminars here locally to mostly small-to-mid-sized buisnesses, in addition to being concerned about paper, the attendees are concerned about e-mail. These are the two great sources of unmanaged structeud information. That is the connection between imaging and e-mail management. And being able to manage both these streams is part of the attraction of the whole digital mailroom concept.

Cheers.

RG