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Technology Stocks : RGFX Raster Graphics

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To: Sam Citron who wrote (221)8/22/1997 11:58:00 AM
From: darren_   of 593
 
Sam,

Just about any inkjet can print onto vinyl but nobody can seem to do it at high speed - except for 3M. 3M has somehow managed to get their new ScotchPrint 2000 to print onto vinyl at 2600 square ft / hour with many resolution settings all the way up to 400 dpi. This machine is killing RGFX''s electrostatic market. It is much more expensive than the DCS machine but many of the people who purchased the DCS printer did so because it was simply the best available.

Check out the numbers for Q4'96 and Q1'97. Consolidated revenue only increased by $445k. While this is still growth, it represents a decline in printer sales that was offset by consumable revenue from the printers that they did manage to sell. This is why they speeded the release of the P5000 - because they are losing market share to 3M in the elecrostatic area. They do seem to be concentrating more on the 2 printers that do seem to have a future though. I am not saying that the DCS is obsolete, I'm just saying that I don't see very good numbers for it in terms of growth.

I am still very unimpressed with the company's marketing strategy. I downloaded the PosterShop trial version only to find that it doesn't mention the company or the company's printers at all. It does, however, mention Encad and HP (these are the only drivers supplied with the software).

I really feel that if they teamed up with Encad, that the combination would be explosive. Every magazine that I read (and I have been reading ALOT lately) seems to worship Encad as some sort of a graphics god.

Darren
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