You are wrong opalapril.
>>Before September 11 VISG was the only dedicated FR company that was consistently making a profit from sales and services;<<
Almost all of VISG's business is digital drivers licenses. They have very limited FR sales. And being profitable is an accounting game. From the 10k you can see they are capitalizing sales and marketing costs and putting them on the balance sheet as "Cost and estimated earnings in excess of billings." They define this as "unbilled accumulation of costs for new contract awards." In 1997 S&M was $4.9 mil in 1998 $2.2 mil, then in 1999 $700k and finally in 2000 $780K. But as of the July 10Q, "Costs and estimated earnngs in excess of billings" had risen to $29 million.
>>Lau, a privately held company, holds the patents and licensed them to their publically held subsidiary, VISG, on an exclusive basis. In other circumstances, one might be worried but Lau owns about 60% of VISG at last report.<<
Lau doesn't own the base face recognition technology, MIT does and it is licensed through the professor who developed it. From the 10K "Viisage and Lau each license the underlying MIT technology for their respective markets through Facia Reco Associates Limited Partnership (Facia Reco), an entity formed by Dr. Pentland." And even more significantly: "This license extends until the expiration of the final patent included in the license and includes Facia Reco's rights to use patented facial recognition technology of MIT, which rights are exclusive through June 1, 2001, except for certain rights granted to sponsors of the MIT Media Lab and certain research rights. Thereafter, Facia Reco's patent license with MIT extends to 2010 on a non-exclusive basis. "
VISG and Lau do have some patents for software used to apply the face recognition software. But that would seem to be fairly easy to replicate. The underlying face recognition technology does not belong to VISG or Lau, and now they don't even have exclusive rights to it.
We disagree on the potential for the technology. That is fair. I think the DoD study is much more reliable and independant than VISG's internal studies or the industry group they quote.
I accuse VISG of hype because of their PR. They were already doing business with Unisys. It is in the 10k as one of their largest customers and partners. And they fail to mention in their airport deployment PR that these are unpaid demonstrations.
VISG has a very dirty balance sheet. They are almost bankrupt. They must sell stock to keep going. The profits are just a game,not real. And I think insider sales will flood the market now that the quarterly results are out.
But that is just my opinion, I could be wrong. |
