Welcome!

News Feed Item

Location Based Technologies, Inc. CEO Releases Letter to Shareholders

Location Based Technologies®, Inc. (OTCBB:LBAS) CEO Dave Morse has released a letter to shareholders.

Dear Shareholders,

I have recently received many calls and emails from shareholders expressing disappointment and concern about LBT’s financial performance. Without exception, we all share your same sentiment. While knowing that success is a journey filled with ups and downs, it is nevertheless not as important to know the reasons why we didn't achieve our performance targets as much as is the fact that we didn’t achieve them. As difficult as that is, it has given us all, here at LBT, a stronger resolve to become even more focused on those things that we can do to create momentum and achieve positive results. Thankfully, in our case, as long as we continue to increase our customer base, persistence is the most sure predictor of success.

Like many other companies both large and small, LBT was hampered by tremendous economic challenges through 2013. However, we are certainly not out of the game, and based on lessons learned, we have a plan to play differently. I want to share with you some insight into a few initiatives that will have an impact on our approach this year – both in the commercial and consumer markets.

Commercial

After a year of discussion, planning, and negotiating with UT Battelle, the managing company of the Oak Ridge National Laboratory (ORNL) for the Department of Energy (DOE), LBT was awarded a 15-month exclusive contract to integrate DOE’s VERDE (Visualizing Energy Resources Dynamically on the Earth) platform with LBT’s proprietary geo-location platform to be offered commercially through LBT to utility companies in both the public and private sectors. This VERDE system is what the Federal Emergency Management Agency (FEMA) and other agencies rely upon during emergency events to display the damage to the energy sector within each state, when restoration is expected to occur, what response measures are being taken, and what is needed in terms of restoring electric power. Bill Irwin, disaster program manager for the U.S. Army Corps of Engineers, said, “It was difficult to get a clear picture of what was going on. Now we rely on the DOE as the authoritative source.” Those responsible for implementation of the DOE VERDE system have been named as “Service to America” 2014 Finalists for the Homeland Security and Law Enforcement Medal. The VERDE solution provides:

         
a) a set of unique/powerful tools to enhance situational awareness for utilities’ operation centers;
b) new capability for field supervisors to more effectively manage power restoration;
c) visibility to power outages along with up-to-the minute severe weather info from VERDE data feeds;
d) and real-time tracking of response crews and equipment with LBT’s GPS data – all on a single map.
 

Initial commercial prospects wanting VERDE shared what they see are the immediate benefits:

         
1) more effective emergency preparation planning,
2) better assessment of critical needs for mobilized equipment,
3) faster response time in the field for communities with urgent needs,
4) enhanced evaluative tools to assess real-time dangers for work crews,
5) reduced operations costs by knowing what equipment is needed and where/when to send it.
 

Based on early feedback, we think this could be a major game changer for LBT, and for the market.

The LBT and ORNL VERDE platform integration is underway. This is a collaborative development effort that will complete within 30-days followed by controlled demonstrations to key accounts happening as early as in June. This timeline is critical due to the fact that the sales cycle is longer, but we are not waiting for finished product to get things rolling with sales. The second reason it is critical is due to the fact that weather predictions for 2014 indicate it may be one of the worse severe weather seasons we’ve experienced in a long time in North America. We’d like to have this in place for Utilities to take advantage of its benefits for reasons of both safety and security.

Our go-to-market approach will include working with channel partners who currently service major accounts in the Utility market – the first of which is a strategic partner who has participated in the discussions with ORNL from inception. Our excitement for successful execution of this commercial business initiative is rooted in the opportunity to balance out our reliance on AT&T by signing up other national as well as large regional clients. In parallel with our Utility market approach we will be seeking GPS technology partners that may want to provide the VERDE integration into solutions for the Telematics market servicing large trucking and equipment fleets. Our pursuit of software only business opportunities may include development of weather and power-outage mobile app overlay that is marketed to consumers.

Consumer

There are three primary shifts in our consumer market strategy launching in 2014:

         
1) shift away from focusing only on small online resellers;
2) partner with large distributors that have a strong channel presence with medium to large retail chains;
3) selling pre-paid Service Plans like we do for our commercial accounts.
 

The approach to offer prepaid plans provides our customers with more convenience, no service interruptions because of lapse in billing, and helps with LBT internal operations by receiving payment up-front. Additionally, this may also create a way for retailers to be able to resell our Service Plans bundled with PocketFinder in the near future.

In the US and Canada we are working with Synnex to develop key account plans to offer PocketFinder consumer products online and then transition into retail brick-and-mortar. This approach is necessary in preparation for launch of our 3G based PocketFinder products later this year. We have engaged with Ingram Micro, the world’s largest IT and consumer electronics products distributor, and hope to bring them on board soon. Ingram Micro would serve as a strategic partner in further development of our retail business in parallel with development of our commercial business as they have over 20,000 value-added resellers who sell into every commercial industry in North America.

We are also in pursuit of specialty channels; namely Auto Dealer channel, Pet channel, Sporting Goods channel, as well as Senior Independent and Assisted Living channel. LBT has previously sold products for use in these ‘markets’ but we have not yet pursued business through a dedicated channel. Each of these channels represents significant pockets of consumers who have varying needs for locating and monitoring loved ones – both two-legged and 4-legged – as well as valuables worth recovering. The first two channels will be Auto Dealers and Senior Living markets in US, with programs expected to launch as early as this summer.

Though this past 2013 year-end holiday sales season was brutal for all retailers worldwide, we managed to have a 150% sales increase over our previous year. Currently, the average street price for our PocketFinder product has come up by about 25% since February with the adoption of a Minimum Advertised Price policy to discourage a handful of resellers from selling our products at single-digit margins, which has now resulted in larger resellers like Amazon, Best Buy, and Walmart increasing orders because they can maintain better margins. We expect to see a positive impact to consumer sales this quarter.

We support our earlier projection based on our current order pipeline along with conservative estimates of what we may be able to achieve with our market expansion to generate $4,000,000 to $5,000,000 of revenue in calendar year 2014. This estimate does not include sales to the US military, which would only add to those figures.

Our singular focus in 2014 – profitability. Now that baseball season is in swing, let me say we will continue to work hard for ‘base hits’, because we know base hits are how ball games are won. Home runs are just an added bonus. Each hit gets us closer to building the momentum needed to reaching and sustaining profitability. We appreciate your patience and your feedback. We wouldn’t be able to make this a successful endeavor without your support. Thank you!

Sincerely,

David M. Morse, PhD
CEO

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
To leverage Continuous Delivery, enterprises must consider impacts that span functional silos, as well as applications that touch older, slower moving components. Managing the many dependencies can cause slowdowns. See how to achieve continuous delivery in the enterprise.
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, discussed the importance of WebRTC and how it enables companies to focus...
"My role is working with customers, helping them go through this digital transformation. I spend a lot of time talking to banks, big industries, manufacturers working through how they are integrating and transforming their IT platforms and moving them forward," explained William Morrish, General Manager Product Sales at Interoute, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Up until last year, enterprises that were looking into cloud services usually undertook a long-term pilot with one of the large cloud providers, running test and dev workloads in the cloud. With cloud’s transition to mainstream adoption in 2015, and with enterprises migrating more and more workloads into the cloud and in between public and private environments, the single-provider approach must be revisited. In his session at 18th Cloud Expo, Yoav Mor, multi-cloud solution evangelist at Cloudy...
Aspose.Total for .NET is the most complete package of all file format APIs for .NET as offered by Aspose. It empowers developers to create, edit, render, print and convert between a wide range of popular document formats within any .NET, C#, ASP.NET and VB.NET applications. Aspose compiles all .NET APIs on a daily basis to ensure that it contains the most up to date versions of each of Aspose .NET APIs. If a new .NET API or a new version of existing APIs is released during the subscription peri...
Security, data privacy, reliability, and regulatory compliance are critical factors when evaluating whether to move business applications from in-house, client-hosted environments to a cloud platform. Quality assurance plays a vital role in ensuring that the appropriate level of risk assessment, verification, and validation takes place to ensure business continuity during the migration to a new cloud platform.
SYS-CON Events announced today that 910Telecom will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and ...
Ovum, a leading technology analyst firm, has published an in-depth report, Ovum Decision Matrix: Selecting a DevOps Release Management Solution, 2016–17. The report focuses on the automation aspects of DevOps, Release Management and compares solutions from the leading vendors.
Continuous testing helps bridge the gap between developing quickly and maintaining high quality products. But to implement continuous testing, CTOs must take a strategic approach to building a testing infrastructure and toolset that empowers their team to move fast. Download our guide to laying the groundwork for a scalable continuous testing strategy.
Adding public cloud resources to an existing application can be a daunting process. The tools that you currently use to manage the software and hardware outside the cloud aren’t always the best tools to efficiently grow into the cloud. All of the major configuration management tools have cloud orchestration plugins that can be leveraged, but there are also cloud-native tools that can dramatically improve the efficiency of managing your application lifecycle. In his session at 18th Cloud Expo, ...
SYS-CON Events announced today that LeaseWeb USA, a cloud Infrastructure-as-a-Service (IaaS) provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LeaseWeb is one of the world's largest hosting brands. The company helps customers define, develop and deploy IT infrastructure tailored to their exact business needs, by combining various kinds cloud solutions.
StackIQ has announced the release of Stacki 3.2. Stacki is an easy-to-use Linux server provisioning tool. Stacki 3.2 delivers new capabilities that simplify the automation and integration of site-specific requirements. StackIQ is the commercial entity behind this open source bare metal provisioning tool. Since the release of Stacki in June of 2015, the Stacki core team has been focused on making the Community Edition meet the needs of members of the community, adding features and value, while ...
Qosmos has announced new milestones in the detection of encrypted traffic and in protocol signature coverage. Qosmos latest software can accurately classify traffic encrypted with SSL/TLS (e.g., Google, Facebook, WhatsApp), P2P traffic (e.g., BitTorrent, MuTorrent, Vuze), and Skype, while preserving the privacy of communication content. These new classification techniques mean that traffic optimization, policy enforcement, and user experience are largely unaffected by encryption. In respect wit...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
SYS-CON Events announced today the Kubernetes and Google Container Engine Workshop, being held November 3, 2016, in conjunction with @DevOpsSummit at 19th Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA. This workshop led by Sebastian Scheele introduces participants to Kubernetes and Google Container Engine (GKE). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, students learn the key concepts and practices for deploying and maintainin...