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Even
Technologies with their major partners has developed an end-to-end solution that will
allow Telcos to broadcast TV programming digitally over PCs, cell phones or televisions
Technology
Digital Compression
(ETI-TSXV)
Even Technologies Inc.
#490 – 601 West Cordova St.
Vancouver, B.C. V6B 1G1 Canada
Phone: +1 604 689 1858
Nick Ringma
President and Chief Executive Officer
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
March 1, 2007
BIO:
Nick Ringma - President and Chief Executive Officer
Mr. Ringma has corporate management, finance and marketing experience in a variety of
arenas. Mr. Ringma was born in Holland, grew up in Vancouver, BC, studied in Michigan and
is a graduate of Simon Fraser University.
Mr. Ringma's expertise includes his ability to take an organization's operations through
radical evolutions and developmental changes. Mr. Ringma managed Miller Electronics'
evolution from one store to 45 Sony Stores for Gendis Inc. As a trained organizational
development expert, Mr. Ringma was involved with the restructuring and expansion of
National Importers Ltd. from 1985-1990. As founder of several small businesses in retail,
trucking and marketing, Mr. Ringma continued to hone his marketing, finance and management
expertise.
An exceptional marketer of electronics, ideas, packaged goods, foundations and educational
institutions, Mr. Ringma has the proven visionary and fiscal management expertise
essential to establishing Even Technologies' products in the marketplace. Encouraging a
creative corporate culture, promoting high standards for customer service and an explosive
marketing drive captures what Mr. Ringma brings to Even Technologies.
Company Profile:
About Even Technologies Inc.
Even Technologies Inc. (“EVEN”) is a Vancouver-based company specializing in
advanced digital image and video coding techniques and in the development and integration
of high-performance systems for media content production and dissemination over broadband
networks. Since its inception in 1997, EVEN has developed next generation general-purpose
still image (PSI_X™) and video (PSI_V™) coding engines as well as a number of
commercial systems including a facial image coding system, a digital media coding studio
and an IP-network television content dissemination system.
Even has implemented this technology in a family of
products designed for peak performance and flexibility. The PSI_V™ codec is the most
technologically advanced video compression engine on the market, capable of visual DVD
quality at 750Kbps. The technology also allows Video on Demand and Video Streaming over
existing telco wire line. Even’s sustainable competitive advantage lies in the
patent-protected technologies developed for use in their revolutionary line of compression
products. This technology enables significant file savings over the competition, while
producing images of much higher quality. The technology has evolved, and will
continue to evolve, to maintain Even’s position at the forefront of compression
technology.
For more information, visit www.eventechnologiesinc.com
CEOCFO: Mr. Ringma, will you tell us about your
background with Even Technologies?
Mr. Ringma: “Even Technologies is a
compression algorithm company that started in the video and still image compression space
and is now gotten to a place where we can now enable Telcos to deploy IPTV today, to the
TV, the laptop and cell phone over their existing network infrastructures without the
costly rebuild of those networks.”
CEOCFO:
Do Telcos know that you exist and are they using your services?
Mr. Ringma: “They are starting to know
we exist. We are in the middle of the first two installations and we are on the tail of
that. They should be completed by late March. Phase II will be completed by the 15th
or 20th of January and Phase III by the end of March. We will then be fully
operational.”
CEOCFO:
How is it done now and how are you doing it?
Mr. Ringma: “Telcos basically have two
choices, either they upgrade their network to allow for the streaming video bandwidth,
which is what they need to for both standard definition and high definition television, or
they have to deploy some kind of compression technology to get the video down to a size
that can be delivered on the existing network. What we have done is compress the video
stream so that you can draw a standard definition television signal through their existing
copper at 750 kbps. What that does is permit the existing infrastructure to be used as a
complete broadcast TV system, giving them full network coverage over their entire
subscriber base. We use an encoder, a range of middleware and a set-top box. On the
technology, we have 11 patents issued and 22 pending.”
CEOCFO:
Are there competing technologies?
Mr. Ringma: “In the space there is the
MPEG-4 and the Windows Media Video version 9 approaches to compressing audio and video
(AV) digital data; so there are two or three approaches. However, what happens is that our
bandwidth requirements for that transmission are about one third of the size of those
required by any of the other compression technologies, allowing us to deliver an economic
model for the operator that does not require the costly network infrastructure network
rebuild.”
CEOCFO:
Who is your target customer?
Mr. Ringma: “Initially our target
customers are any one of the 1,200 independent phone companies in the US, but our true
ambition is to be a supplier to some of the majors as well. To that end, we have had a
range of conversations with some of the majors but the installs will be three independent
phone companies.”
CEOCFO:
What is the revenue model?
Mr. Ringma: “We provide encoders for as
many channels as they want, whether 100 or 300 channels. We provide them encoders, a range
of middleware, which includes the electronic programming guide, the VOD servers, and the
billing system. We then provide the set-top boxes and for us there is an initial sale to
the Telco of the equipment, middleware and the licenses. There is also a recurring revenue
per set-top box per month in the field.”
CEOCFO:
What kind of response are you getting?
Mr. Ringma: “The response has been
amazingly favorable. Currently it is a problem with standard definition, but as they have
to upgrade and move to HD, the funnel size issue is going to become huge. Our solution
allows them to move into that market and stop the line loss that they are suffering in
their current deployment approaches, without having this massive capital
expenditure.”
CEOCFO:
With 1200 US telcos how do you decide on your target customer?
Mr. Ringma: “We have been in this space
and one of our key partners, Bob Sanders, has been in the Telco space in the US for a long
time. We identified 3 or 4 of the key operators in the U.S. Telco sector in the
independent phone market, such as with Silver Star Telephone Company in Freedom, WY
(Silver Star Communications), which is a contract that we have announced. Allen Hoopes is
the past chairman of the technical committee of OPASTCO and we looked at that as an ideal
initial client. That was because not only do we get an install up and running, but we also
get acceptance in the industry by somebody that is the technical expert in the field and
has a real understanding of the space.”
CEOCFO:
Sounds like a well thought-out plan!
Mr. Ringma: “As a small company we had
to get focused about who we wanted to deal with. There is a pipeline of about 20 or 30
Telcos that all want us to come and do their Telco after the first one is up and running.
Once you get the first one, everybody wants to play.”
CEOCFO:
Development is expensive; what is the financial picture at Even Technologies today?
Mr. Ringma: “We have been running on
key principal investments. We have probably invested and spent just north of $30 million
over the last 5 or 6 years to get to where we are. We were relying on both invested
capital as equity in the public markets and secondly as some convertible debt that we are
looking to raise right now. What we are doing is looking at the convertible debt
instrument only because it gives us less dilution and more upside for investors look at
what we are doing.”
CEOCFO:
You have applications beyond just the Telcos; what can we look for in the future?
Mr. Ringma: “We are looking with a
deployment company in London actually, which is looking to build a cell phone base
platform where they want to push content to the cell phone. We are working with a company
that is looking to do streaming of live events over the internet. We are looking at a
range of other applications for the technology whether that is in intranets or in home
security or medical applications. However, primarily our focus has been and will be in the
next 6 to 12 months, to get the Telco sector up and running, and then we will work with
value-added resellers to move into those other markets.”
CEOCFO:
What are the challenges ahead and how are you ready?
Mr. Ringma: “We are a small company,
and some of the competitors are relatively large. I think we are ready to deal with that
issue because we have a better core technology. In terms of getting that accepted by other
parties means actually getting the units installed and running so that proof of concept
will allow us to overcome the size issue. Then, it is going to be an issue of how do we
adequately ramp-up the corporation into the market because the Telco sector in the US is a
huge market. With people forecasting this whole streaming video on-demand, the market
could be looking at $10 billion plus annual market over time. Our goal is to simply
identify a specific slice of it and get established in that slice.”
CEOCFO:
Why is this a good time for investors to be interested and what should they know that
doesn’t jump off the page?
Mr. Ringma: “We have a core team of
very brilliant scientists, and the technology is adequately patented including grants of
patents in jurisdictions like Japan where it is incredibly difficult to get a grant. The
technology is very solid, which makes it a complex story to tell to investors, but we have
come through the whole tech development stage and have now come to the product. We have
built product, the hardware encoder and we have built the set-top box, so the core items
have been addressed. It is now going to market. From an investor perspective, the timing
is probably perfect to look for us because all the dirty work is done and we are ready now
to market the product, identify the customers and do the installation.”
CEOCFO:
In closing, what should people remember about Even Technologies?
Mr. Ringma: “People should remember
that Even Technologies has a solution for the Telephone industry that can be deployed
right now and to effect that solution we have worked with a range of major partners in
areas like the browsers done by Ant Plc, and we have the middleware layer from Kasenna. We
have also integrated encryption from a company called SecureMedia Inc., so we have looked
at people who are best-of-breed in their category and have integrated them into the system
to provide an end-to-end solution for the Telco, rather than have everybody piece together
a what if and maybe, and if you try this it might work. We actually have an end from the
satellite right to the set-top box, a system that is integrated, tested and ready to
go.”
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