Googe Buys Word Processing Company

What do you think the desktop is going to look like in 10 years?

SAT Snafu

Here's an article that details some of the reasons for the mistakes that were made recently on SAT scoring. It seems less-than-perfect OMR performance is at least partially to blame. Pearson NCS gets hit pretty hard in this article.

Here's the response we got from Scantron's Tim Dubes when we asked him to comment on the situation:

"While we really don't want to be perceived as grave dancers--and keep in mind that even state of the art OMR is not going to produce 100% accurate results in all applications--there appears to be a number of areas that the SAT test scoring system could be improved. Remember that this is a complete solution that is being called into question, not just individual technologies. So while a significant technology advancement like Scantron's SIMR (Scantron's Intelligent Mark Recognition) can greatly improve recognition accuracy in less than optimal conditions (including damaged forms, lower confidence marks, damaged tracking marks, and the like), it is only part of an overall solution. In the case of the SAT scoring, the inability of the software to accurately flag degraded forms and marks that fall below the necessary confidence threshold could have contributed to the poor results.

"One of the key points that Scantron makes to our customers, particularly in the education field, is accountability. This means that we are responsible for all the components of the solution: we make the software application, we build our own hardware, we design & print the forms in our own facility, and we provide complete training and professional services with our own employees. Sole source accountability removes a lot of variables, and allows us to control the data capture environment, whether we are installing a customer-driven solution or providing the complete data collection solution on an outsourced basis. This also eliminates a lot of the variables from cross-vendor solutions and gives Scantron and it's customers the confidence to move forward with recognition-based technology for mission critical applications. I'm certain that the students' that are negatively affected by the SAT scoring issue would consider it to me a mission critical application."

SourceCorp acquired

This was probably bound to happen in light of the proposed acquisition activity recently surrounding ACS. Private investors seem to have developed an affinity for service businesses over the past year. Over the past year, SourceCorp seems to have put their house in order and had a good strong third quarter of '05. Wonder who could be next?

New capture devices

I'd say new scanners, but actually, Kodak's new device is a network scanstation. Here's a review of it by our friend Doug Henschen at Intelligent Enterprise.
Also, HP, the original network scan-only device vendors with their Digital Sender, have announced three new workgroup scanners. Yes, they've added true duplex capabilities and also introduced a new sheet-fed only model. The capture software, aimed at the desktop user is pretty cool also.

More detail in next week's DIR.

Stellent Dividend

This is kind of wierd. Incidentally, it seems to have helped the stock price, which has been climbing steadily since last May.Is this some kind of a new trend? Will we see more ECM companies following suit? Or, is Stellent just trying to differentiative itself and get more notice on the stock market? At the end of the year, they only had $60 million in cash and short-term investments in the bank, so they're not exactly flush with cash. We thought they might use some of that to buy a capture vendor. A dividend? Well, if it works...

RG

Dicom News

Big news out of the Dicom Group in the last couple of days. First off, on Tuesday, they announced the acquisition of LCI, an IDR software developer out of Germany. The company seems to advertise technology similar to that of SWT. It was founded by academics, however, and like Mohomine, and to some extent Neurascript, was more technology than marketing driven it appears - although Kofax told me LCI has some 70 customers.

Then, today, Dicom announced it would be discontinuing its Samsung distribution business - the SGA portion of its business. This has been in the works for a long time, and the division had been up for sale, but apparently no buyers. Once again, I'll give Dicom tremendous props for their vision to move out of this business - which I think is how the company started - and into document imaging. Ironically, it seems to have taken the hiring for a former distribution as CEO - Rob Klatell who spent more than 30 years as an executive a components distributor Arrow Electronics - to ring the final bell for SGA. I guess Klatell knows a healthy distribution arrangement when he sees one...

TIS Posts Strong 4th Quarter

Dare we say that Top Image Systems looks like its in pretty good shape? The company recently posted a fairly strong fourth quarter, has $8 million in the bank, and appears to be headed in the right direction for both growth and profitability. I'd compared them to Captiva a few years back, but they are still a bit too small. OF course, Top Image has also struggled for years to establish a foothold in North America. But now that they have established themselves in Japan, and seem to have turned a corner, maybe NA is next - with acquistion or merger being the best route.

I wonder if EMC knows who they are?

Ricoh Awards

This is pretty cool. A lot of these guys offer document capture solutions. I guess all it takes is 100-grand to get some serious traction on your embedded copier solution. I betcha' Canon wishes they would have done this with MEAP. Just kidding. We'll wait to see some of these products out on the market before we pass judgment.

TIS Lands Invoice Deal

Looks like Top Image Systems has landed another smokin' huge invoice processing deal.

IBM MFPs

It appears IBM is entering the MFP hardware business. Wonder who they are OEMing from? The eight-inch color touchscreen for scanned image previews sounds pretty cool.

Planet Adobe?

Check out the new Acrobat users group site.

Scientigo customer

It seems our friends at Scientigo have landed another customer. Scientigo is an IDR capture developer that we profiled a couple months ago. They are also the guys who claim to have patented XML. Their latest customer is Critical Technologies, on Oklahoma City-based software developer that formerly were the FilesOnTheNet ASP guys. Like Scientigo, they seem to be a fairly small organization with some solid technology.

Imaging In Healthcare

I love this, this HIS vendor has released an "enteprise-wide document management system" that's called "Department Imaging."

Also, here's a Dallas-based ECM vendor that has released a healthcare specific document and image management system.

It seems the HIMSS (Health Information Management Systems Society) conference is taking place in San Diego this week.

Check out the 7th paragraph in this article... The one that starts with Virtua Health. "More recently, Virtua selected Initiate to perform file analysis and eliminate fragmented and duplicate records as part of its move toward a document imaging system." I'd be interested to know exactly what that involves...

RG

Open Source Systems

Here's an interesting post about a college kid who's pretty proud of his $125 document imaging system. No, it's not going to stand up to enterprise stress, but it's a neat starting point, and I think a peek into the future.

Also, it appears Alfresco, the Open Source DM specialist founded by former Documentum execs, has secured some more funding. I don't know, but the $8 million figure seems like a low amount for such an ambitious venture, but maybe we're harkening back to the dot-com days when VCs had money in wheelbarrows. Then again, Alfresco (from when we talked with them) seemed to have a pretty efficient business model, so maybe they don't need that much.

RG

AnyDoc Opens U.K. Office

Here's another former Captiva salesperson surfacing at AnyDoc.

Can Reynolds be far behind?

Not that Mr. Bish is going to end up at AuthentiDate, but I guess you never know, they do have some pretty good technology... Anyways, I was a bit surprised to see that one of Captiva's top salesmen had taken a job with docSTAR. docSTAR is an SMB targeted application - so at least it's in a high growth area of the market, but it's clearly a much less established business than Captiva was.

Dicom posts solid results

Looks like Dicom Group is back on track after a down first quarter.

Recent news

Here's an interesting story announcing John Harland acquiring an ECM software vendor. Harland is an $800 million entity that has a financial services software business, Harland Financial Solutions (HFS), that acquired Mitek Systems' check and imaging business a couple years back. Harland corporate also owns Scantron. I wonder of the Mitek stuff wasn't working out.

Also, here's a deal between a couple companies we saw at Visioneer's recent partner event.

Kodak Breakaway

At the Kodak Breakaway 2006 show. Their resellers extravaganza for Document Imaging. Had a lot of great converstations here. It's really a well attended event. I think there were like 500 people. Last night was the ISV show and there was plenty of new blood exhibiting. We saw Cabinet NG there, advertisting its imaging for QuickBooks. Also saw FileBound, maybe somebody called Scanning America. There were also a lot of old school resellers in the house.

Sat on a media panel the past couple days with Harvey Spencer, Ken Congdon, Brian Sherman, Ron Galz of IDC, Mike from InfoTrends, and even Doug Henschen was in the house for the first day. (I apologize for any misspelled names.)

Big concern of the VARs in the audience was digital copier dealers and how to compete with them. My basic view is that a decent scanning soluiton on a digital copier can be expensive and that resellers can definitely compete on price with workgroup scanners and know-how about the imaging industry.

The other big point I was trying to make, and I don't know if I had the full support of the rest of the panel on this, was that VARs need to focus vertically if they want to thrive in the next 10 years. Imaging as a horizontal solution is becoming a commodity. And new protocols in areas like SOA, XML, and Web services are going to make it easier to "image-enable" vertcle packages. This is where the margins are going to be.

Recently spoke with a VAR CSI, down here in FL, that has sold a tremendous redaction solution to some county courts that automates a process associated with a new regulation. These guys seem way ahead of the game on this and their sales number are up like three times thanks to it. They were already working with the courts on some extraction stuff, and because they were focused were able to come up with this redcaction thing. So, now they have a repeatable solution (even filed for some patents) that they can sell around the country. It's driving revenue and I'm assuming it's driving profits.

RG

DRS Acquires Peladon

Peladon Software, out of San Diego, has got a pretty nice buyout from U.K.-based DRS. Peladon is the intelligent forms processing sofware developer that was founded by some former Mitek employees, as well as a U.K.-based Mitek partner. Peladon has created a fairly effective IDR application working with a variety of recognition engines. Peladon has a "high-confidence character inspection" module that we featured in a post-AIIM issue.

Peladon seemed to have a decent install base in the U.K. and had one big U.S. customer in SunGard. They sold the company for what looks like $4-5 million to English service bureau and forms processing sysems specialist DRS. DRS, to me, seems like an English version of Scantron.

DRS paid a good healthy price(about 2 1/2 times revenue). I also think Peladon has some good software. This is more evidence of the health of the capture space and the valuation that some of the advanced technologies have. RG