MANAGEMENT REPORT
QuesTec Imaging, Inc.
QuesTec Imaging, Inc. provides real-time virtual replays and unique digital content for professional sporting events for TV, webcasts, ?interactive TV?, analysis, and video games. QuesTec is the industry leader for real-time sports data capture and visualization. QuesTec's customers include FOX Sports Production, FOX SportsNet, MSG Network, NBC Sports, CBS SportsLine, ACTV, Williams ChoiceSeat, ZDF and ARD German National TV, France2 and France3 French National TV, The Golf Channel, and The Sports Network. QuesTec enables these customers to increase their viewer interest and awareness, as well as increase revenues, by providing them with unique video and digital content on high-profile sporting events, such as the World Series, the French Open, the ATP World Championships, and World Cup Golf.
QuesTec uses cameras, computers and sophisticated military-grade technology to track moving objects (baseballs, tennis balls, players, anything that moves) and instantly, in real-time, reconstruct digital 3D images which can then be viewed from any angle, "replayed", compared and analyzed. Current sports include tennis, baseball and golf. For example, viewers of the 1999 French Open could see Agassi's serves showing precise speed, curve and court impact. They could see "spray-charts" of Agassi's serves, analyze his first versus second serves, and review umpires' calls.
Each sporting event can lead to multiple revenue streams for QuesTec. For example, QuesTec can display the pitches in a single baseball game on FOX Sports Net and: 1) Simultaneously broadcast to ACTV and Williams ChoiceSeats. 2) Provide a real-time broadcast over the internet to MajorLeagueBaseball.com, CBSSportsline.com, yahoo.com, totalsports.com, and espn.com. 3) Provide the same data to the baseball teams, for team training and player analysis. 4) Sell the data to video game producers. QuesTec is the only company with these capabilities.
QuesTec's partners include: 1. Atlantic Aerospace Electronics Corporation, a Titan (NYSE: TTN) company, providing QuesTec with R&D resources second to none. 2. Live Motion Corporation, a leading provider of digital replay and virtual studio services to broadcasters throughout Europe. 3. Siscom Media, a provider of innovative data mining solutions to coaches, players and sports franchise executives in the NBA and NHL. Siscom opens up new markets for QuesTec, specifically, video-on-demand services for team training, Internet, and Interactive TV. 4. Major League Baseball, in discussions with QuesTec regarding a New Media Alliance. 5. PGA, also in discussions with QuesTec regarding a New Media Alliance. 6. Discussions underway with other sports league governing bodies, including the ATP. 7. Silicon Graphics, a long-time QuesTec sponsor who provides technology expertise and assistance. Silicon Graphics and QuesTec are currently working on a major technology initiative which will be announced in the next few months.
QuesTec's competitive advantages include: 1.Massive technology lead. 2. Patented technology. 3. Strong relationships with governing bodies such as MLB, PGA and ATP. 4. Strong relationships with major broadcast networks such as FOX, NBC, ZDF, and RTL. 5. Strong relationships with leading New Media players CBS Sportsline, ACTV and Williams ChoiceSeat. 6. First-mover advantage. QuesTec will be wired in all 30 MLB stadiums by next Spring. With strong MLB & PGA ties, and rapidly growing ATP ties, QuesTec is well on the way to securing a permanent franchise in baseball, golf and tennis broadcasting.
QuesTec directly benefits from the rapid convergence of sports, TV and the Internet, and is attracting considerable interest from major players in this area. As the number of viewing options increases, and as the number of players in this arena expands, the worldwide appetite for content is growing, especially unique real-time high-profile digital content.
Current Business
Current Markets
Current markets for QuesTec's products are baseball, tennis and golf.
Current Products
QuesTec offers the following products:
 SuperVision. This is used in Major League Baseball ("MLB") to create virtual replays for television and provide a behind-the-scenes analysis tool for commentators. SuperVision tracks each pitch, then measures the speed, path and trajectory at various intervals as it approaches the strike zone.
 eBaseball. This is the narrow band transmission of quantified baseball action for interactive television and webcasting. eBaseball has been used by CBS Sportsline, ACTV and Major League Baseball.
 GolfProView. This is used during television golf coverage as an "instant preview". The GolfProView system locates the golfer?s ball on the green, then proceeds to calculate and display the optimal putt path using 3D graphics. In addition, GolfProView displays in real-time the exact distance to the hole, the ball's height with respect to the cup and quantifies the break or breaks in inches.
 TennisProView. The TennisProView system instantly captures and displays the exact speed, trajectory and court impact of each serve during a tennis match. TennisProView creates a virtual replay for television and a behind-the-scenes analysis tool for commentators, providing spray charts, serve analysis and player comparisons.
Current Partners
QuesTec has a 7-year agreement with Atlantic Aerospace Electronics Corporation ("AAEC"), a Titan (NYSE: TTN) company. AAEC is a leading military software developer specializing in acquiring and tracking multiple targets in real-time. AAEC will provide QuesTec with all research and development of live-motion-capture tracking technology for future sports related applications in exchange for a 500,000 share equity interest in the company and 10% of product-related gross sales.
QuesTec has a strategic partnership with Live Motion Company ("LMC") of Wiesbaden, Germany, whereby LMC markets and produces QuesTec's products in Europe. QuesTec and LMC split costs and share profits. So far, LMC has produced the French Open and several German tournaments. LMC and LMC's customers are extremely enthusiastic about this relationship and numerous further projects are under discussion or already finalized.
QuesTec has a strategic alliance with Siscom Media to database, manage and distribute the data collected by QuesTec?s products. QuesTec?s products will be integrated with Siscom?s existing data mining and video indexing systems which are already in use by the NBA, NHL and soon to be beta tested with the Arizona Diamond Backs. The integration of the two companies? technologies will create a new league standard for professional sports. As part of this relationship, QuesTec will look to develop and integrate its technology into Siscom?s existing products for the NBA and NHL. Siscom opens up new markets for QuesTec, specifically, video-on-demand services for team training, Internet, and Interactive TV.
Silicon Graphics is a long-time QuesTec sponsor who provides technology expertise and assistance. Silicon Graphics and QuesTec are currently working on a major technology initiative which will be announced in the next few months.
Marketing Plan
QuesTec 's marketing strategy is to:
 Maintain dominance in current markets through technical excellence and outstanding service.
 Enter high-profile new markets and then similarly dominate them.
 Build global awareness of the QuesTec brand.
QuesTec wishes to establish itself as the branded market leader in real-time data-and motion-capture systems for sports. QuesTec will do so by:
 Targeting high-profile customers. 1. Broadcast and broadband video providers. 2. Database content repackagers providers. 3. Web-based information providers. 4. Professional teams and leagues.
 Using current and new customers as channels for distribution of new products.
 Launching concentrated direct sales and marketing efforts to maximize existing relationships to penetrate new markets.
 Launching a promotional campaign targeting journalists and editors who cover sports, media, entertainment, the internet and investments.
 Significant on-air exposure during sports broadcasts that use QuesTec products. Most QuesTec products carry the company?s logo or end of production credits.
 PR by customers as they promote their own services that utilize QuesTec products. For example, FOX will promote the fact that its baseball games feature QuesTec?s technology.
 PR on QuesTec?s behalf by customers. QuesTec intends to include a PR component, when possible, in contracts with customers. At the very minimum, any contract with QuesTec is subject to the client's issuing a full Press Release on the subject. Discussions are underway with several clients on this subject.
Management has defined the company?s direction and initiative as follows:
Mission Statement
Our mission is to maintain preeminence in sports information gathering and dissemination by applying state-of-the-art technology to extract and characterize comprehensive data capturing all significant events on the field of play for the major sports of interest worldwide and to present this information to all interested parties using a combination of communications, electronic, and print media with emphasis on broadcast and internet based services. The development and operations practices we follow are aimed at achieving the highest levels of information quality, reliability, and integrity for the customer.
QuesTec management anticipates that they will complete the company?s Form 10 registration and appropriate Securities and Exchange Commission filings during the first calendar quarter of 2000.
QuesTec has put together the most comprehensive and experienced computer visualization and real-time action oriented sports gathering and information services team in the world. The company is aggressively marketing its products and services on a global basis. QuesTec?s technology is being promoted to Leagues, Networks, Sponsors and Internet Providers on a worldwide basis.
This report was prepared by management and they accept responsibility for its contents. Michael Russo, Director. |
