BCB Voice Systems Inc. - more has changed than just our name!
It's almost an understatement to say that BCB has undergone a major transition through the past six months. While our goal remains the same - to become the leading vendor of digital recording and voice file management systems - the company's capability and competency in support of this goal has been dramatically improved.
Our company's overhaul starts with the management team. While retaining the experience and determination of BCB's founding chairman and two senior vice presidents, new drive, vision and industry knowledge has been added through the appointment of a new president, executive vice president, chief financial officer and national sales manager.
Working together, this team has been building a company strategy and infrastructure that can sustain significant growth and ongoing profitability through the years ahead. This has meant converting the company from its focus on engineering and hardware, to software and marketing. This change of focus will create significantly greater margins and broader markets for BCB products.
To support this shift, existing products have been refined, improved and repackaged while development of new products and product upgrades continue on a carefully managed basis. In conjunction, the company has sought out new partners who provide leverage through a combination of financial, technical and marketing contributions.
For example, validation of BCB's technology, and potential has recently come through investments made in BCB by Lernout & Hauspie Speech Products N.V. and Flanders Language Valley Fund. Lernout & Hauspie (NASDAQ:LHSPF, EASDAQ:LHSP.ED) is an international leader in the development of technologies that provide the speech user interface and language user interface for a wide variety of third-party applications and end-user products. Belgium-based Flanders Language Valley Fund is the only fund worldwide that is focused exclusively on investing in speech and language technologies. Microsoft Corp. holds a stake in both L&H and Flanders Language Valley Fund.
BCB also entered into a major marketing alliance with UHER Informatik gmbH, a leading German manufacturer of audio recording technology whose products include high-quality digital hand-held recorders and multi-channel soundcards that utilize TrueSpeech voice compression. The deal gives BCB the exclusive right to distribute UHER digital products throughout North America and options on exclusive distribution for other markets worldwide. BCB and UHER are also co-operating on future product development, including speech processing and speech recognition applications.
This alliance offers significant benefits to BCB, giving us access to a respected brand name and innovative hardware, such as the digital hand-held recorder. Because UHER products, like our own, incorporate TrueSpeech voice compression, they are easily integrated with our patented PC-DART digital recording and voice management systems. The combination of UHER's products with our own opens up new markets and promises to exponentially expand our installed base.
This is just one more indication that BCB has the tools and technology in place to rapidly grow both its top and bottom line. However, as history continues to prove, good technology by itself does not win. BCB's products have to be brought to market intelligently, quickly and aggressively.
In this regard, work is already underway. In August, 1997, we began rehabilitation of our distribution system, recruiting independent dealers and distributors that combined knowledge of the dictation and recording market with PC and networking expertise.
These efforts resulted in a regional agreement with CLM Sales Inc. of Atlanta, Georgia, the leading independent U.S. distributor of dictation equipment. Now, that agreement is being expanded and CLM is adopting a national focus for the distribution of BCB products. More recently, BCB became a Data General authorized independent software vendor (ISV), making BCB's technology available on Data General's AViiON servers and CLARiiON storage systems. Also, as part of this agreement, Data General has agreed to provide network installation, integration and maintenance services in support of BCB's enterprise installations worldwide.
When this alliance was announced, Jeff Goldstein, general manager of Data General (Canada) Co. pointed out, "BCB's growing success in introducing voice systems to enterprise customers in a variety of industries makes BCB an ideal partner for Data General. Our ability to associate with BCB and deliver voice recording and voice file management capabilities to our customers will benefit everyone - BCB, Data General and most of all our customers."
By focusing BCB's efforts on software development, and by ensuring that our systems are based on open architecture, PC-based systems, we offer other leading third party software vendors the opportunity to add voice capabilities to their applications. This has already enabled BCB to work with PC DOCS, a leading vendor of document management software, CADI, a leading vendor of case management software, Healthcare Technologies Inc., a leading vendor of transcription and workflow software, and Lernout & Hauspie, a leading vendor of voice recognition and translation software.
In every case, these integration efforts allow BCB to "piggyback" into an installed base of customers, accelerating BCB's market penetration.
Looking ahead, this transition of BCB promises to accelerate revenue growth through the coming fiscal year. Equally important, continuing improvements to BCB's development and production processes, combined with the enhanced gross margins offered by our focus on software, mean that profitability can be realized much more quickly.
We are confident that the fiscal year just begun will be a breakthrough for BCB and its shareholders. Improved products, new alliances and broader channels add up to assurance that our team at BCB can now translate potential into performance and post significant financial results.
Ken Murton, Chairman & CEO
Peter Vanderlee, President & COO
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