Here joe, this is for you... from TWOMIL on RB.
Fred's Letter: AN IMPORTANT MESSAGE-LISTEN!!!!
Irrespective of this morning's price action that carries its own message what we are being told by management is that all the planning and preparation for satisfying the needs of manufacturers for handheld music is now in place. What is not being stated in clear terms is when will these contracts be announced with eDig or our licensees and what is the competition doing or not doing that will make others effective competitors.
I would like to address the latter for a moment and clarify that what the labels are asking of manufacturers for the most part is only being addressed and provided by eDig's reference design. The labels have embraced Intertrust's DRM and clearinghouse solutions much more than IBM's, MSFT's, Liq. Audio's SP3 or Sony's, Magic Gate. The labels are also using AAC, ePac, and some Atrac for their codecs. THEY ARE NOT USING ANY OF MSFT'S PRODUCTS for their DAM, DRM, or codec. IBM has also not been effective in promoting their DRM and DAM solutions with the labels.
The recent announcement by MSFT giving RNWK their player has been met with 1 big yawn by the labels and others in the industry---SO WHAT. Toshiba's announcement yesterday about their using IBM's drm in their player is likewise a similar---SO WHAT.
The labels will be licensing various sites and retailers access to their servers so that they can direct customers to these servers and participate in revenue sharing for each download. If a handheld manufacturer can't provide their product to the end-user with a clear, clean, and simple download, why will the label or consumer be inclined to recommend or buy a handheld that can't deliver the above?
Unless Toshiba, Sanyo, Philips, and others recognize and produce such a player those products will sit on the shelves. I see nothing in their releases to acknowledge that they understand this. I believe it very likely that the Maycom/eDig combo will be able to show customers the complete package, get signed contracts and their usable multi-codec product out the door in the next 6 weeks before companies like Toshiba, Sanyo, and others even come to terms with their faulty designs. This is the beauty of two relatively small but savvy companies uniting to beat out some of the bigger manufacturers while getting others to use their reference design.
This new distribution method for intellectual property is going to evolve in an ongoing fashion. I predict eDig will be offered other business opportunities for revenue sharing of content as inducements to help sites be in the forefront of different types and styles of handhelds for their offerings.
Today's letter from management tells us we are very, very close to being able to announce contracts and that the labels are racing to get their content on line in the next 6 to 8 weeks. IMO, eDig will offer the most complete and well designed product to meet the voracious appetite of all who've watched and waited and now will want the product delivered tomorrow.
For those who see and understand this, the current share price offers an amazing opportunity. For those who don't understand the above, it looks impossible. Stranger things have happened in the high-tech world, but it's only in retrospect that all become believers.
What is even more disbelieved is that intellectual property distribution is only one of eDig's fields of interest. Telephony and voice recognition will be another booming market and all of this is on the drawing boards of the companies with which we have close relationships.
One of the biggest decisions eDig's management is going to be struggling with over the next 2 to 4 months is which customers offer them the most profit potential without having to greatly expand their engineering and management staff. If engineers ever wanted to work with a company that can be on the cutting edge of the consumer market and developing new approaches to voice interfaces, they couldn't find a better company with which to seek employment.
As shareholders we can bring a lot of information and ideas back to management. I have always found them receptive, accessible, and appreciative of opportunities to improve their operations. It's clearly one of the unique attributes that makes them successful. It's also why companies like Lucent, Intel, and IBM have sought them out to get quick solutions to difficult problems.
Good luck to all.
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