Article on another flat-panel startup:
Xerox spinoff prompted PARC chief technologist
to join
(Fixes slug on COMPUTERS-XEROXPARC (BUSINESS
FEATURE-SIDEBAR))
By Therese Poletti
PALO ALTO, Calif., Aug 28 (Reuters) - Among the companies spawned by the famed Xerox Palo Alto
Research Center (PARC), one spinoff so intrigued its chief technology officer that he decided to quit
his lofty research job and join the start-up.
Palo Alto-based dpiX Inc. makes high resolution flat panel displays that it hopes will revolutionize the
medical radiology market and also find a home in military jets.
''I had done a couple of these before,'' said Malcolm Thompson, dpiX president and chief executive,
in an interview at dpiX's hilltop headquarters, not far from PARC. ''In 1995 we asked Xerox PARC to
spin out, I decided to go with this one.''
dpiX is one of 10 companies that have been spun-off by Xerox's New Enterprises, which is focused
on commercializing Xerox's sometimes too academic research efforts.
The company was formed in 1996, with about $100 million investment from Xerox for its costly U.S.
manufacturing facilities, and about $50-$70 million in combined research grants from the Department
of Defense, over various periods.
dpiX is a rare U.S. company to manufacture high resolution active matrix liquid crystal flat-panel
displays, which are mostly manufactured by Japanese electronics giants.
The Eagle flat panel displays made by dpiX show such incredibly sharp, clear images that they have
contracts to put its displays in the cockpits of planes for the U.S. Army, the U.S. Navy and the Royal
Australian Air Force, for mapping, target and night vision systems.
In the $1 billion medical imaging market, dpiX hopes to revolutionize the radiology market, which has
been the last field in medicine to go digital.
dpiX's FlashScan systems eliminate the need for medical X-ray film. Radiologists can capture an
image faster, with a lower X-ray dose than a standard X-ray and the image, which is stored digitally,
can be sent to physicians via e-mail and can be viewed on a screen of powerful computer
workstations.
''This could radically transform medical technology,'' said John Seely Brown, director of Xerox PARC.
''It will affect our lives in meaningful ways.''
dpiX is now shipping a prototype of its FlashScan system to some customers, such as the University
of California at San Francisco Medical School.
''This is a very big application,'' Thompson said, adding that 200 million X-rays are taken in the
United States and that 5 percent are lost. ''We are absolutely the world leaders and we are ahead of
everyone.''
But competitors are nipping at its heels, including General Electric Inc.'s GE Medical Systems unit,
Sterling Diagnostic Imaging Inc., Fischer Imaging Corp. and others.
''It will be interesting to see the dog fight, as the digital X-ray market heats up,'' Mike Cannavo,
president of Image Management Consultants, a consulting firm in the Orlando, Fla., area. ''dpiX needs
to get a good strong partner.''
dpiX has joined with Varian Associates' Imaging Products division to sell the FlashScan system to
equipment manufacturers to become part of a medical imaging system.
Thompson said that he expects dpiX to be profitable by the end of next year and that the company will
likely eventually go through a conventional initial public offering.
Until then, Thompson said some of its customers have expressed interest in further funding the
company, which is very capital intensive because of its complex manufacturing process, as well as
some Silicon Valley venture capitalists.
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