VirTra Inc (VTSI)

[gemmerling]

Fort Worth Star-Telegram - Virtual visionary

An Arlington company sets its sights on the training simulation market

By Jim Fuquay

Star-Telegram Staff Writer



SPECIAL TO THE STAR-TELEGRAM/BRIAN LAWDERMILK
Kelly Jones is chief executive and one of the founders of VirTra, which started life as an interactive gaming effort.



THE ASSOCIATED PRESS/PAUL CONNORS
At VirTra's training center in Phoenix, production assistant Sean Monks, center, and lead graphic artist Brent Barcena, left, demonstrate a 300-degree image simulator that tests whether a trainee will use force in response to a domestic violence scenario.

ARLINGTON - After playing games for six or seven years, little VirTra Systems of Arlington has gotten dead serious.

The maker of virtual reality presentations got its start as an Internet-based interactive entertainment system. But recently, it has moved into police and military training in the hope that advances in computer and display technology will lead to the sales that have largely eluded the company so far.

Last week, VirTra -- short for Virtual Training -- announced that it had sold one of its virtual reality training systems to the Air Force. The systems use high-definition projectors, laser-equipped weapons and interactive computer systems to let trainees practice marksmanship and hone their use-of-force judgment in scenarios ranging from a domestic disturbance to a hostage situation.

Since October, the company has also announced sales to an Indian company that provides law-enforcement training and to the city of Chihuahua, Mexico, police department. VirTra's systems start at about $80,000 and can cost up to about $250,000.

The publicly traded company, whose shares trade over the counter, needs more deals like those if it is to break into profitability. Last year, it lost $1.5 million on just under $1 million in revenue. That was better than the $2.7 million it lost in 2002, also on about $1 million in revenue.

Arlington attorney Kelly Jones, VirTra's chief executive and a former Arlington city councilman who helped found the company, said VirTra is betting on its latest technology to break into what he estimates is a $200 million training simulation market.

Which brings up the question of money: Why spend tens of thousands of dollars for sophisticated video systems, when police and military training services can just put participants in a mock environment using their own street-smart officers and train for real?

For example, the Fort Worth Police Department holds training sessions using experienced officers and Simunition, a paintball type of product used nationwide.

"It seems more realistic for us to do real training" rather than use simulations, said Lt. Paul Jwanowski, the department's training coordinator.

Jones and others acknowledge the value of such training, but argue that simulations sold by VirTra and competitors offer one other feature: safety.

The issue of accidental shootings is not hypothetical, as illustrated by the 2001 death of an Arlington police officer during a training exercise.

"Simulations are an excellent way to move into and begin to approximate the training required for real-life encounters," said Bill Lewinski, a professor of law enforcement at Minnesota State College and director of the school's Lethal Force Center.

Arlington Police Lt. Blake Miller, who supervises personnel, recruitment and training, said his department is experimenting with a simulator on loan from another agency. The department also continues to use Simunition and role-playing for training exercises.

"We don't want to limit ourselves to one way of training," Miller said.

No one counts how many police departments use simulation systems. Michael Kitchen, VirTra vice president of sales, said there are about 6,000 training simulators in the United States, many of them in the military, with hundreds more around the world.

Ed Nowicki, executive director of the International Law Enforcement Educators and Trainers Association, expects their use to grow. Besides the safety issue, he said, simulations allow objective evaluations of trainees' performance.

"The software can tell you how long it took before a pistol appeared until the officer responded," said Bob Ferris, VirTra president. He called it "a fair, objective way to rate" a group of trainees under identical conditions.

VirTra's move into simulations dates to just after its merger in 1999 with Ferris' company, Ferris Productions. He had worked on entertainment products for theme parks and promotions for about 10 years, but also had developed the simulation software.

Simulation systems use a number of techniques to present a realistic environment, said Zane Horton, senior software engineer at VirTra. Once a scenario and its likely variations are recorded, the data is loaded onto a computer hard drive. The images are projected on one or more screens in front of a trainee, who can be armed with a baton, pepper spray or a gun.

The simulator can detect a laser mounted on a weapon and instantly respond. An instructor can direct the system's response to verbal commands, such as a trainees' shout, "Put down the gun!"

Using Los Angeles-area sets and actors -- or the client's own facilities -- VirTra uses high-definition cameras to capture 360 degrees of images, Ferris said.

Lewinski said the 360-degree simulations help avoid "tunnel vision" that can come from flat-screen training. Studies show that nearly a quarter of police fatalities involve an officer shot from behind.

VirTra is just getting into the police market with its system, but Lewinski thinks it can hold its own with competitors. Firearms Training Systems, a $60-million Georgia company, leads the industry.

FATS, as the firm is known, also offers numerous military simulations, including armored vehicle crew training. The publicly traded company has shown a profit in two of its past four fiscal years but reported a $2.6 million net loss for the first nine months of its current fiscal year.

VirTra also continues to sell promotional systems, such as a project it delivered last week to the Army. The setup, installed in a recruiting van, puts viewers inside a simulated Black Hawk helicopter as it rescues a downed pilot.

It also recently sold a 3-D promotional presentation to Bombardier for its Sea-Doo watercraft.

Jones said he has plowed about $550,000 of his own money into the company, which started life as an interactive gaming effort called GameCom, and the company has kept afloat with borrowing and stock sales.

"Eighteen months ago, I wasn't sleeping well at all," Jones said. But he feels the company made a breakthrough in March at the Tactical Response Exposition, a law-enforcement trade show in California, which helped produce the latest Army contract.

"They're sure filling a niche," Lewinski said of VirTra. "They need to get out and market themselves now."


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