The chairman of a small high-tech company based in Herndon says giant International Business Machines Corp. could do it a favor by becoming a competitor.
Robert Hanfling of Vidar Systems Corp. likes to shock investors in the privately held company with this statement, for which he gives the following rationale:
Vidar makes a device that scans large documents such as blueprints to produce electronic copies that can be clarified or otherwise altered by computer and then stored or transmitted.
As Hanfling sees it, the problem is that Vidar and its current competitors cannot afford the kind of advertising campaign necessary to make the existence -- and advantages -- of large-document digital scanners known to most potential customers. Were IBM or other computer giants to enter the field, however, they would advertise on a large scale and spread the word, according to Hanfling, who was deputy undersecretary of Energy in the Carter administration. Hence, his tongue-in-cheek wish for bigger competitors.
"It's almost a classic high-tech startup problem: being ahead of the market," he said. "We may have been earlier than we anticipated" in making the scanners available. "Timing is everything."
Hanfling said potential customers for large-document scanners include companies that are involved in engineering, mapping, document storage and retrieval, document transmission, production of technical publications and security, as well as government agencies and the military. Vidar sells mainly to companies that assemble systems from other manufacturers' products and to manufacturers that package other companies' products with their own.
Thus far, Vidar has signed contracts calling for delivery of as many as 230 scanners over the next 15 months, according to Hanfling. Negotiations are under way on contracts that could lead to the sale of 150 more, he added.
He said outside sources have advised him that the potential market for scanners could hit $500 million a year in North America by 1990 and that he believes the U.S. market will be $100 million next year. "We think we have a shot at 10 to 20 percent of that market," he commented, adding that Vidar also will be selling scanners outside the United States.
Hanfling said that competitors include Skanteck of Moorestown, N.J.; Optigraphics Corp. of San Diego; ANA Tech Corp. of Denver; Industrial Vision Systems of Lowell, Mass.; and Syscan of Norway.
Unlike many American producers of high-tech electronics, Hanfling is not worried about the Japanese. He said that Japanese companies do not appear to be planning to produce large-document scanners for export soon because of the relatively small size of the market for such products and because the small amount of labor needed to produce them reduces a main advantage for Japanese manufacturers -- lower wages.
He noted that Mitsubishi Corp. is selling ANA Tech Corp. scanners in Japan and that Vidar is talking with three Japanese companies about similar deals. Even if the Japanese decided to enter the market, Hanfling estimated that American producers have at least a two-year cushion.
Vidar's scanner works by making an electronic image of a document that passes in front of its four interior lenses, according to Chuck Rieger, Vidar's vice president for research and development. This electronic image can be thought of as a series of notations on the amount of light or darkness in each segment of the document. The notations are digitized; that is, they are in a form that can be read by -- and manipulated by -- a computer.
The electronic version of the document can be displayed on a computer terminal screen, transmitted by telephone to other users or stored on magnetic or optical disks.
The company's 4200 series of scanners became available in December. The first model was designated the 4220. The 42 refers to capacity: The scanner can accept a document that is up to 42 inches wide. The 20 refers to the number of dots per inch (actually 200) in the electronic copies that the scanner can produce. A model 4240 being prepared for distribution in the spring will produce copies with twice the resolution -- 400 dots per inch.
Hanfling said that prices for the 4200 series will range from $70,000 for one scanner down to as little as $35,000 each if 25 or more are purchased over a 12-month period. Vidar is selling a scanner with a built-in personal computer, interface board and cables. He estimated that many competitors' scanners are selling for between $10,000 and $15,000 more, but also pointed out that Industrial Vision Systems' models are selling for about $5,000 less. "The market does not appear to be that price-sensitive," Hanfling said.
Vidar also plans a 4240S model, which could produce copies with a resolution of either 200 or 400 dots per inch, giving customers the choice of slowly producing copies with a higher resolution or quickly producing copies with a lower resolution, according to Hanfling, who also noted that lower-resolution copies occupy less space on a computer disk.
The third model also would permit greater integration with existing computer-aided design and manufacturing systems, and could electronically recognize words and shapes and could do layering. Layering is the ability to produce multilevel drawings and then display or print out any combination of those levels.
Vidar was started in the fall of 1984 by Eldak, a Norwegian company that produces CAD-CAM equipment. Eldak still owns 15 percent of Vidar, and Bjorn Dale, a director of Eldak, owns 30 percent. There have been three private placements of shares in Vidar, all in Europe. Now Vidar is looking for American investors. Hanfling was recruited to be Vidar's president and chief executive officer by the company's legal counsel. He also became chairman in December.
"I like running these small, high-risk companies," Hanfling said. "I like making things happen." Vidar has 62 employes, including production workers who build circuit boards and assemble the scanners. Some of the parts are produced by subcontractors.
In June, Vidar bought Reston Consulting Group, which had designed the 4220's mechanical and optical systems on a contract basis.
The move enabled Vidar to about double its size and increase its capabilities.