Response to a former regular "poster" here. It's point by point.
First, you said good-bye a few days ago. I guess you got lost and had to come back home. Welcome back (sort of).
1.. As to the issue of cash flow positive, the quote was made "We hope to see results in the next year or so". Am I the only one heard that quote? Yes they said they were becoming a leaner company to get burn rate down, but they didnt say, as some here implied that that will get them cash flow positive by years end. Even the CEO said lets address that issue in a FEW months. A few is how many? Three, four, five, six? In other words its still way to early to even talk about cash flow positive.
HD comments: If you look at the burn rate being over 1,000,000 per quarter at the end of 2Q06 and the statement they have reduced overhead costs and if revenues are growing then it would be LOGICAL to say that they are much closer to be positive than negative. It would take a net change in revenue of just $3,000,000 to get us to positive cash flow. If our overhead is being lowered and the revenues are going up I would surmise that by the end of the 4th Quarter we could be cash flow positive. CJ statement of a few is more than two but a limited number of units in standard English. CJ’s hint to me is by the end of the 4th Quarter, i.e. three months.
2. On the issue of patents, some here are suggesting that NEXTCODE and OP3 are infringing and the CEO said they have an implied license. That is not what was said. The CEO said anyone who agrees to use QODE will have an implied license to NEOMs technology. It was also stated that NEXTCODE and OPS have their own symbology, indicating that they werent violating NEOMs patents. They did say they were going to keep an eye on them, incase they do overstep their bounds, is the way I took it.
HD Comments: Wrong about that. What they said and you misconstrued is that they had their own symbology and this makes it difficult to deal with them when using scanners and readers. They NEVER said they were not violating NEOMs patents. What they said is that these to companies bear watching. Also, Martin Copus said that he has sat down with them to discuss business. He also said that they would watch them as they Evangelize the PWC in marketing. It was reiterated on the conference call that NeoMedia’s model is to prefer to do business with these companies than to have to take legal action. Your take on the issue is way off base.
3. It was reiterated that they have licensed to a couple of companies to date? Only a couple? What about all the noise here that there were many deals behindd the scenes to license Qode? I guess we now know that was all just hype from some posters here right?
HD Comments: True they only have a few announced licensing deals that are PUBLIC. Thanks for sowing doubt again that Qode doesn’t have any brand partners behind it. Way to go with the doubt.
5. The program is only developed in 5 languages to accomodate the UK and European markets at this time, since they are further developed. They mentioned France Italy and a few other countries, so you can forget a worldwide launch all at once.
HD Comments: The plan has never been for a worldwide launch. It has always been to look to Europe first, followed by the U.S. and then other markets.
6. Speaking of the world wide launch or hard launch some here posted daily about, there wont be one. It also was stated that they are looking at new pilot programs in those European countries, as well as some roll out programs.
HD Comments: Slow ramp up using Symbian, followed by introduction of more Java-enabled phones as they are approved followed by introduction of BREW in the U.S. By the way, where do think Martin Copus has been the last few months. He is pinging between the UK, France, Germany, Italy and Spain. Let’s see that’s five languages. Just watch.
7. On the patent issue they stated they have 27 patents in 14 countries. How many countries are there in the world? And those 27 patents are divided into 4 groups, and not all of any one group is effective in all 14 countries. Not to mention some of the patents have to do with paint as well. So contrary to some heres believes, not all 27 patents are in effect in all 14 countries. No one here at this time knows what patents are established in which of those 14 countries
HD: Brew, take it on yourself to discover where these patents are authorized. You will find out that the European Union has accepted a few key NeoMedia patents. How many countries are in the European Union? I let you find out and report back. Homework project to keep you busy in researching WHY YOU OWN stock in this company (if you really do).
8. I pointed out before the big money is in advertising. NEOM made it clear they are not in advertising or search. They are merely a direct connect application, which can aid a user to get to an advertisements web page, but they wont collect any revenue off the advertisement.
HD: We don’t want to be advertisers. Never have. The money is not in advertising. The money will be in enabling brands to market directly to consumers. In the end advertisers are cut out. So in effect we make money while the advertisers have to redo their method of operation. They have to be able to work with brands and customize their advertising schemes to be directly connected.
9. In China there are 2 mobile carriers and two land based carriers for phone communications. Thats it 4 carriers. China already has smart codes in every type of print media available as I recall the statement, with China Mobile leading the field in this space. Add to that the fact NEOM has no patents in China so its gonna be a tough sell there.
HD: It’s always a tough sell in China. It takes time and patience. I have that and so does NeoMedia. The best example of this is Coca-Cola. In 1993, Coca-Cola saw China as a big possibility. There were close to 800 million people in China that did not know they “needed” Coca-Cola products. China wasn’t even close to being on the top 25 places of revenue generation for China. The plan was to slowly introduce Coca-Cola in select parts of China. Over time the goal was to build out from these pilot programs. (Sound familiar). After these pilots were off and running and Coca-Cola received feedback on what the Chinese people had in tastes for Coca-Cola products Coca-Cola was able to modify their growth strategy and the change the types of products they would introduce. Over the last 13 years China is now the 2nd or 3rd largest market for Coca-Cola products. It took patience and hard work, but it has paid off now. The Chinese people now “need” Coca-Cola when 13 years ago they had no idea what Coca-Cola was.
Look at Qode. Forget the patents side for now. Qode is the system that allows people to directly connect to webservers without having to fat-finger in long character sequences on their 12 digit phone pad. The Qode platform that includes the camera function and soon to have the Gavitec Universal reader on the way will allow a user to connect to ANY 2D barcode that allows universal usage. We may also be able to read the proprietary 2D Qodes. Let’s see how negotiations occur between OP3 and NextCode. Don’t be surprised to see OP3 in the NeoMedia fold in the not to distant future. OP3 is a small company that has potential that’s why you heard Martin Copus saying he sat down with the owners of OP3. NeoMedia is quite familiar with them. Let’s revisit this in a “few” months :)
10. On BREW they anticipate it being ready by year end, and have a prototype they are now working on, but said its been very difficult. So take the word they used "ANTICIPATE" for what it means. Its not a definate.
HD Comments: Let’s talk tech for a while. I want to educate everyone about the technology behind the Java and Brew systems.
Let's get into the details about each Java-enabled phone. Each phone has unique characteristics and require precise lines of encoding to make them work seamlessly between the Qode window and the enabling of a web browser. The most telling features are the capabilities of the camera and the screen size, i.e. number of pixels in the x,y direction. Ideally every phone would be the same but they aren't. So NeoMedia has to come up with Java programs for each phone and then get each certified. This is not easy, but has been going on. From what I can gather there are a handful of phones ready that operate off Java. So we can at the very least do Nokia phones and some Java phones. So Martin Copus is spending most if not all of his time in Europe lining up brand partners. So expect to see the "trial" programs develop that are initially launched where the full functionality of Qode will only be on Symbian-based phones with a phased-in adding of Java-enabled phones as each one is approved for use by Java certification and probably the handset manufacturers. I think they will be called trial because they will continually ramp up to cover more and more phones and likewise more countries in Europe.
BREW OS. This is the number one operating system for handsets in the U.S. and the most unique in terms of having to develop software tools. I understand that in order to get a software module to interact with the browser on a web-enabled BREW cell phone, the module has to be integrated directly into the browser. Martin Copus alluded to this in the conference call. So for Qode to work in its full functionality it needs to be encoded directly to the browser. This means that Qualcomm's browser has to have Qode built into it. At the ASM NeoMedia showed that their intention was to have Qode operating on BREW-enabled phones this quarter. What does this mean? In order to get Qode on a BREW cell phone you would have to download an update to the browser. I believe that NeoMedia is not doing all the programming in-house. I don't know who is doing the outside programming but it probably has the attention and possibly need the assistance from BREW's owners Qualcomm for it to be fully integrated into the browser. I have talked to friends that have worked with BREW and now I know why they complain about the difficulty in working with this proprietary platform. It also confirms why it takes so damn long to get the BREW version of Qode one to market. But when it does finally get to market it should be a big thing (IMHO).
11. As to revenue, I find it hard to believe that they couldnt talk any new numbers, when they did just that in a recent PR when they said 12snap had just under 500,000.00 from 2 customers this past quarter. They said they couldnt talk about anything not released publicly, well wasnt this a public CC? And if it was simultaneous to a PR with some numbers then no harm no fowl. At least a projected revenue could of been given, and most companies do that all the time, so that was just a cop out in my opinion. But when we get to see that 500,000.00 in revenue from 12snap, watch what the expenses were.
HD: It’s obvious you don’t understand that a public company cannot release revenues unless they are ready to release their financial results. It was not a cop out. The doubt is growing as you water your previous seeds with even more doubt.
12. Lastly on the TS issue, some here are now posting how he is hanging himself by making public statements to his readers. Does that statement also apply to NEOM when they make a public statement alleging criminal activity, in a PR they put out to stop the bleeding? Funny how no one here has been able to connect TS directly to this so called 3rd party yet all these allegations have been being thrown around carelessly. Maybe NEOM can make the connection, since they are the only one knows who they were negotiating with, but certainly no one here has a clue. My take on the situation is that NEOM was negotiating a deal to get some kind of analyst coverage by someone significant. There is always a fee to do a right up on a company so you can claim you have coverage, so there would be some kind of fee negotiations going on. This person being a stock analyst works with many companies and issues many reports. NEOM may have assumed since TS is a stock reccomendation person, he was at times using this analyst for TA on some of the companies he reccommends. Yes it could be that simple. I dont think he was working with someone, if he wasnt smart enough to wait for that person to tell him he had the signed contract in his hand, before issuing the sell order. Everything TS has said I said here more then once, and I too lost faith after waiting some 3 years. So have many others who post here, so why think it would be any different with TS, someone who is supposed to be an expert in picking stocks.
And as to TS referring to the 2.3 billion shares outstanding, they get that number by factoring in how many shares NEOM needs to settle all its debts at todays share price. That includes the preferred stock shares, the warrants, the acquisition shares, the compensation to the acquired companies on guaranteed price etc. promissory notes, employee benefit plans etc, and yes its up around 2.3 billion based on a share price of .10. It was 1.3 billion when they asked for the increase in shares authorized, and I believe at that time the pps was close to .40 a share.
HD: His vociferous statements against NeoMedia are telling. Three weeks ago I got a pump from him telling that the company that has Paperclick is the best investment story in his 25 years of investing. Boy how is opinion turned in three weeks. I don’t think ChangeWave would want to defend their pumping to one set of investors and their telling another set of investors about the doubt they were having in NeoMedia. The discovery process that may or may not occur in the near future will be telling. See what it brings.
AI
