Interview with Alex Cory, CEO, NevenVision Inc

Feature Company

Interview with Alex Cory, CEO, NevenVision Inc.

April 2006

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You recently joined the company in November 2005. What initially attracted you to NevenVision?

I looked at NevenVision as a company that had an exceptionally strong technology platform in a variety of recognition technologies that could be applied to two very fast growing, very large markets in both biometric identification and in mobile marketing and commerce. On the one hand, you can use the technology to create foolproof verification of identities--which is very valuable in a post 9-11 world. On the other hand, you can also use to technology to literally hyperlink every commercial image in the daily lives of consumers around the world.

Can I just follow up on that Alex? You have expanded into the i-Scout line for visual mobile search to help marketers and merchants. Could you describe how that works?

You use your camera phone to snap a picture of a commercial image (and someday an object) that's of interest to you as a consumer, either in print media, like a magazine or newspaper, or on a billboard or a poster in a subway station. You can also snap images on a TV screen. It then gets sent to our servers--using our thin client or email or MMS codes--where it is recognized and then the appropriate digital content is sent back to the consumer from the advertiser, content owner, or the marketer. There are a whole variety of applications it is useful for -- it could be a direct connection to digital content, a path to a transaction, more detailed product information, coupons, and other things. As a simple example, we can talk about the campaign we did for Coca Cola that ran in teen magazines in Germany last fall. When you saw the ad, you snapped an image of their logo and in exchange for that we downloaded a game that you could play on your cell phone. Another example could be something we are working on for a movie studio to introduce a new movie. They decided to run a scavenger hunt. You are sent a series of clues by SMS. The clue directs you to a visual image. You snap a photo of it and send it into our servers. We record that you got that clue and send you the next one. After you have collected the series of clues, you get free tickets to the movie if you are one of the first x number of people to complete the scavenger hunt, and you get entered into a contest -- and each of those clues by the way is an opportunity for a secondary advertiser to work with the movie studio (and pay for the movie studio's advertising). For example -- let's say the studio is already in a promotional relationship with McDonalds. You can essentially create an opportunity for McDonalds to generate foot traffic into their store and charge them for it. This creates an advertising campaign for the studio that's very low cost, for McDonalds that is very effective, and for the consumer something that is fun and that (we are seeing in our early results) tends to create much more positive images of the advertiser and much more memorable kind of event. So in total, you have created a very rich branding experience for both the studio and their sponsors, while also generating a direct response lead for a physical location like McDonalds.

It certainly seems to hit the sweet spot with mobile advertising needs and technology -- it is a brilliant concept!

For our consumer business, we see ourselves as being at the centre of the two biggest trends in advertising today, which include performance based advertising for marketers-- you are paying for something only because it creates results based on an action by the consumer, and the second big trend, which is moving advertising towards more of a service to the consumer as opposed to a tax they have to pay to get access to what they really want. We are not forcing a consumer to watch an ad to get something, we are basically letting a consumer choose to act on their interest in a commercial image to get what they want whenever they want it. They can essentially say, "I am interested in that -- how do I get information -- how do I buy -- how do I find things related to that?"

That's so easy to do -- plus it sounds like fun!

It is fun. For the consumer, this is easier, less time consuming, and a fun process. As a consumer, I am very engaged. I am actively involved in getting to exactly what I want right now without going through the process of seeing your ad, and later trying to remember what I wanted and act on it. Right now, I've got to go and find a store or sit at a computer, enter a web site, and think about interacting with you in that fashion, instead of interacting at the moment of interest.

There are three ways for the consumer to get from the image to the content. They have to send that image to us, either through an MMS long or short code or through an e-mail attachment, or more ideally they have to have our thin client downloaded onto their cell phone that connects directly to our servers. There are a variety of ways that we are working towards creating something that makes it attractive for consumers to download thin clients (beyond the fact that it eliminates MMS messaging fees). In addition to the iScout platform we are looking to introduce later in the year what we are calling mobile companions, which will be services where we aggregate services through relationships with different players in a particular vertical space--for example, music, movies -- and create the opportunity for the consumer to go to one place and be able to access information, content, merchandise, transactions, and anything else they want based on the recognition of a single image. For example, let's say they are out and they see any ad for any movie -- they can snap a picture of it, send it in, and have the choice of watching a trailer, finding show times and buying tickets at a theatre in their neighbourhood, getting promotional merchandise from the studio, finding revues and maybe even peer revues from a social networking partner or maybe being entered into contests. There is still the whole advertising opportunity there for the studio that has produced the movie, but in addition to that you can collect a whole number of other service providers around that concept so that -- if I see a movie poster I might want to put it in my Netflix queue, I may want to buy a DVD from Amazon of that movie or reserve a future purchase once it is released. I may want to watch a trailer from IFILM; I may want to simply go watch the movie at my local theatre. That starts giving you some functionality as a consumer that makes it worth your while for you to have a client loaded on to your handset.

Thank you for describing that. NevenVision also described its objects and face recognition technologies as the fastest in the industry as well as the only recognition technology that can be embedded into mobile devices. Can you elaborate on that for us?

Neven Vision really started with a focus on the biometric side and on mobile devices in particular. Because of that focus, Neven had to fine tune the recognition algorithms to be very efficient to be consistent with the limited processor time and battery life of a mobile unit. We have developed a product called the Mobile Identifier™ for law enforcement applications in particular (and we are working on a military version that is in testing). This product allows personnel in the field to be able to immediately identify suspects they are interacting with. In law enforcement, it acts as a mobile mug shot book -- any officer in the field from the novice to the veteran, can have the same amount of intelligence in the palm of their hand. Instead of using valuable resources to transport a suspect to the station for identity verification, with the Mobile Identifier™, officers have something on their belt that lets them scan an image of an individual and use that to compare against relevant data bases and confirm who it is they are dealing with. Then they can make the decision as to how they proceed with that person without losing field time. This also puts all the officers in the unit in control of the same field intelligence, dramatically accelerating the learning curve for officers that are new to that beat. We are piloting prototypes of our product with the LAPD right now, in particular working with some of their gang task forces. The device carries up to 200,000 records on the device itself, so I don't have to rely on being at a Wi-Fi connection or communicating back to a laptop or server someplace (although that is an option). It is right there, in my hand, and that record includes the image of the person as well as their criminal background or other relevant information about them. That is a pretty powerful tool for force multiplication for law enforcement agencies. We are working on moving the prototype from its current capabilities of facial recognition to also having fingerprint identification built in so you have combined fingerprint and face capabilities on your belt if you are a police officer. We will also be able to build in skin recognition to pick up tattoos, moles, and other identifying characteristics in the 2.0 version of our product.

This would also have terrific military applications as well.

We agree and we are testing in the more extreme field conditions of a military setting and we are getting early feedback that it is working very well. You could imagine, for example, being someplace where you are dealing with certain people that you don't have reliable forms of identification for, so if you have an initial database of photos (plus you can record new images while you are in the field), it could allow you to identify known threats or conversely you could use it to identify local people who have been cleared to be on base or in the vicinity of troops.

NevenVision technology has performed very well in FRVT and other tests over the past few years. What makes your technology unique?

There are really only a handful of companies that have consistently scored in the top three of the Facial Recognition Vendor Test, and we are one of them. We are very proud of the accuracy, speed, and flexible applications of our technology. We have a very strong IP portfolio (both granted patents and patent applications) built around really developing what I would think of as a fingerprint of the face. Our approach is based on finding the points of interest in an image, and then mapping the unique characteristics around that point of interest. By doing that over literally dozens of points within an image you get a unique mapping of what that image really looks like to a recognition algorithm. And we have built algorithms that can evaluate a very large volume of images in a very short amount of time (up to 1 million per second for facial recognition, for example). We believe in the testing that has been done, not only for the FRVT, but also by many companies who have done comparison testing before deciding to deploy our solution. Through all of these tests, it's been shown that we are substantially faster than the other players with world class capabilities in facial recognition at similar levels of recognition.

What can we expect to see from NevenVision in 2006?

We are creating a focused organization in 2006 for both biometric identification and for mobile marketing. We will be taking our Mobile Identifier™ product out into the marketplace as well as supporting efforts with partners for projects like -- booking stations for police forces, airport screening and passport and border control devices. Those would be the things that we will largely focus on. The military applications, as you can imagine, we will be working on but you will probably not see a lot or hear a lot publicly during 2006. On the consumer side, you will be seeing a number of campaigns that are introduced in countries globally that take advantage of the "shoot and get" technology that we have developed --shoot the image and get the digital content that you want. We will also be expanding our campaign tools to make it simple to also do scavenger hunts, shoot to win contest campaigns, and shoot to vote campaigns. In addition, we will be developing personal utilities or mobile accessories -- such as the mobile companion concept that I have described. We have already sold in Japan a mobile security utility that automatically verifies the identity of the user of a cell phone any time they try to access private data or use the cell phone for a transaction. We expect this capability to be marketed globally in the coming year. We also have a photo management solution that we are working on that does automated sorting and tagging and allows you to do searches of your digital photos. We also have previously developed some fun photo messaging applications - we have one called Masquerade, which takes an image and allows you to add animation to that image so that if you want to send an e-mail of a picture of yourself with hearts bubbling out of your eyes that says, "I love you" to your girlfriend, you can do that. You can put hats and scarves and moustaches on peoples' pictures -- it is really just to play around and be playful with photos that you then send as fun messages to your friends and family. We are already distributing this directly to consumers in Europe through a reseller relationship on a partner web site. So there are a number of things we will be working on. A lot of those will be coming out in the second half of the year. In the first half of the year we are going to put most of our focus on the mobile identifier product on the biometric side and the iScout platform on the consumer side.

Alex, thank you for taking the time to fill us in on all the activities going on at NevenVision. It sounds like a very exciting time for the company and I wish you well for 2006.

It has been my pleasure Peter.

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