Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. ¨
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
 
State issuer’s revenues for its most recent fiscal year: $2,841,849.
 
As of June 30, 2008, 10,920,597 shares of the Company’s common stock, par value $0.01 per share, were held by non-affiliates, which had a market value of approximately $10,920,597 based on available OTCBB quote of the average between the high and low bid of $1.00 per share.
 
State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: The number of shares of common stock of the registrant outstanding as of June 30, 2008 was 23,757,470.
 
Documents Incorporated by Reference: None.
 
Transitional Small Business Disclosure Format (Check one):  Yes ¨ No x


FORM 10-KSB
STATMON TECHNOLOGIES CORP.
March 31, 2008
 
TABLE OF CONTENTS
 
   
Page
     
PART I
     
ITEM 1. Description of Business.
 
     
ITEM 2. Description of Properties.
 
     
ITEM 3. Legal Proceedings.
 
     
ITEM 4. Submission of Matters to a Vote of Security Holders.
 
     
PART II
     
ITEM 5. Market for Common Equity and Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities.
 
     
ITEM 6. Management’s Discussion and Analysis or Plan of Operation.
 
     
ITEM 7. Financial Statements.
 
     
ITEM 8. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.
 
     
ITEM 8A(T). Controls and Procedures.
 
     
ITEM 8B. Other Information.
 
     
PART III
     
ITEM 9. Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance With Section 16(a) of the Exchange Act.
 
     
ITEM 10. Executive Compensation.
 
     
ITEM 11. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
 
     
ITEM 12. Certain Relationships and Related Transactions, and Director Independence.
 
     
ITEM 13. Exhibits.
 
     
ITEM 14. Principal Accountant Fees and Services.
 
     
Signature Page
 


This report contains forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1934. Some of such statements involve substantial risks and uncertainties. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "could," "plan," "project," "continue," "believe," "expect," "anticipate," "intend," "estimate" and other variations of these words or comparable words. In addition, any statements that refer to expectations, projections or other characterizations of events, circumstances or trends and that do not relate to historical matters are forward-looking statements. Such statements involve known and unknown risks, uncertainties and situations that might cause our or our industry's actual results, level of activity, performance or achievements to be materially different from any future results, level of activity, performance or achievements expressed or implied by these statements. Certain factors that might cause such a difference are discussed in the section entitled "Cautionary Factors that May Affect Future Results" in this Form 10-KSB, along with any other cautionary language in this report, provide examples of risks, uncertainties and events that may cause our actual results to differ from the expectations described or implied in our forward-looking statements.
 
Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this report. Except as required by law, we do not undertake to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
 
In this Report, “Statmon”, the “Company”, “we”, “us”, or “our” refer to Statmon Technologies Corp. and its wholly-owned subsidiaries, STC Software Corp. and Statmon-eBI Solutions, LLC.
 
ITEM 1.   DESCRIPTION OF BUSINESS.
 
Company Overview
 
Statmon Technologies Corp. is a wireless and fiber infrastructure network management solution provider. “Axess”, our proprietary flagship software application, and our supporting integration products are deployed in telecommunications, media broadcast and navigation aid transmission networks to optimize operations and ensure they remain healthy and on the air 24/7. A typical infrastructure network comprises a network operations center (“NOC” or “Master Control”) plus a network of remote transmission sites that incorporate a wide range of communications devices, facilities management and environmental control systems.
 
The Statmon Platform is designed to self heal or preempt transmission failure by automating the integration of all the different devices and disparate technologies under a single umbrella control system and permit manual corrective action at the NOC or from any connected computer including a wireless device such as a Blackberry. A tiered severity level alarm system at every site, down to the device level, reports back to the NOC logging automated adjustments or permitting manual adjustment or corrective action without a field technician having to physically travel to the remote site. Any authorized operator can drill down through the Axess software screens to see exactly what is taking place with an individual device or system at a remote site and make further adjustments as required.
 
The optimization of network performance plus the preemption of failure eliminates or minimizes network or individual site downtime. Transmission downtime typically has a mission critical or direct financial impact on the customers’ top line revenue generation, operating profit and customer satisfaction. Investment payback periods relative to the purchase cost of the Statmon Platform compared to the operators loss of revenue or costs of being “off the air” typically make the return of investment (“ROI”) highly attractive. For example, advertisers do not pay for commercials that do not go to air, or cell phone users cannot make phone calls, email, text or download video content when a base station or cell site is off the air. On a geographical basis, the Statmon Platform significantly streamlines the network engineering, emergency remote site field trips and routine maintenance process, reducing operating and outsourcing costs and facilitating the reallocation of resources. For example: the ratio of the number of cell sites being managed per field technician can be improved by a meaningful amount. On the politically correct front, the Statmon Platform can dramatically facilitate the “Go Green” policies being increasingly implemented by all levels of corporate and government entities.


Architecturally designed as a universal “Manager of Technologies” (“MOT”), application or platform, wide scale network operations, regardless of disparate equipment brands or incompatible technologies deployed at a NOC or remote site, can automatically interact with each other while being managed from a single point of control or “dashboard” style computer screen. In real time, a proactive alarm system reports to a NOC or designated wireless device for appropriate attention or action. Adjusting the HVAC, the health of the uninterrupted power supply (“UPS”), the diesel generator and the level of the generator fuel tank, as well as disaster recovery, emergency power management and redundancy are all proactive management capabilities of the Statmon Platform. The Statmon Platform will keep remote sites operating even when part or all of the entire network are down, automatically bringing the remote back on line when network operations are restored.
 
Telecommunications infrastructure and high speed networks in both developed and developing countries around the world are being aggressively upgraded to meet the growing subscriber demand of services. In developing countries, wireless networks provide an affordable alternative to the more expensive hardwire or landline infrastructure. Notable are the third generation, or 3G, wireless and infrastructure transmission networks which are being upgraded to handle the rapid traffic increase, wireless broadband and convergence of media delivery and additional data services for the wireless and IPTV fiber markets. Cable systems are offering telecommunication and broadband services to their customers and upgrading their networks including deploying Statmon’s proprietary “Accurate” Local People Meter monitoring platform which interfaces directly with Nielsen. Statmon’s unique radio frequency (“RF”) background and know how in the mainstream media broadcast industry places us in a strategic position to provide high end solutions for the enhanced telecommunications networks offering video and enriched multimedia content.
 
The marketing and distribution of our products is primarily facilitated by third party sales channel partners, value added resellers (“VAR”), black label and original equipment manufacturer (“OEM”) collaborations (“Channel Partners” or “Strategic Partners”). Channel Partners are developed and managed by an internal business development team and supported by a direct sales and engineering support force. We have a history as an innovative technology leader for remote site facilities management, transmission remote control and monitoring in the traditional television, radio, satellite and cable broadcast industries. The traditional network television market is undergoing a resurgence of activity and reformatting as the high definition television (“HD TV”), cable and satellite delivery systems realign their operating and business models including offering additional digital channels that individually focus on HD programming, continuous news coverage and weather reporting, sports and special interest coverage. Leading network broadcast operations are being streamlined or rationalized with central casting, regional hubs and unmanned stations and remote site transmission operations. The traditional radio markets are retrofitting to multi band digital transmission in order to remain competitive with satellite radio, mobile TV, multimedia and music content direct to cell phone or mobile device offerings for automobiles, trucks, public transport and the military.
 
We successfully entered the telecom wireless infrastructure vertical market via a contract with the Qualcomm wholly owned subsidiary, MediaFLO USA (“MediaFLO”), to deploy our Axess software and related integration products for the control and monitoring of their national mobile TV network rollout. This is the largest transmission network of its type, in the world, based on the Qualcomm developed “FLO” encoding and compression technology for multiple channels of live TV and multimedia content directly to cell phone and mobile wireless devices.
 
At this point, MediaFLO is providing the “FLO” mobile TV and multimedia platform (the “FLO Platform”) directly to the Verizon and AT&T cellular subscriber base. From the MediaFLO NOC in San Diego, the Statmon Platform controls and manages all the remote sites throughout the USA to optimize the FLO Platform transmission performance and Verizon’s and AT&T’s mobile TV customer satisfaction. We anticipate that the MediaFLO mobile TV platform will be adopted by additional wireless operators around the world, although we can offer no assurance in this regard.


Under our agreement with MediaFLO, we are licensing our Axess software and supplying interface components for the MediaFLO San Diego Network Operation Center and the national rollout of wireless transmission sites. Under such agreement, Qualcomm and/or MediaFLO periodically issues purchase orders to us. From September 7, 2006 to March 31, 2008, Qualcomm and/or MediaFLO had jointly issued us purchase orders totaling $4,133,430. Since March 31, 2008 to the date of this filing, we have received purchase orders for an additional $1,047,205, of which we have delivered $578,360 of the products under these purchase orders. The MediaFLO agreement is dated September 7, 2006 and specifies no minimum or maximum number of purchase orders and is for a term of three years. The number of MediaFLO sites is expected to increase as the network expands. We also provide support and maintenance to MediaFLO renewable on an annual basis.
 
We have commenced penetrating and with adequate operating capital are poised to pursue rapid expansion into additional vertical markets, including the wireless telecommunications (cell phone), mobile TV, IPTV over fiber networks, microwave telecommunications, multimedia, gaming, grid and emergency power management, government infrastructure management, homeland security, military communications, surveillance and other markets where centrally controlled network management, embedded industrial systems and wide scale remote monitoring and control solutions are being implemented.
 
We believe our products have broad application in the wireless, landline and fiber segments of the telecommunications industries providing network management, alarm monitoring and remote site control, transmission and facilities management solutions for many of the new planned networks, as well as the upgrades and wide scale infrastructure enhancements. In developing countries, wireless infrastructure networks are being developed as viable alternatives to wired networks. Economic remote site management is vital for viable carrier operations.
 
We expect the wireless and infrastructure markets to experience sustained growth over the next ten to twenty years as the carriers and infrastructure service providers compete to provide superior and additional wide-ranging services, including enriched video and high quality content to mobile devices, wireless broadband and other related mobile data delivery services customers expect. We believe that our background in the mainstream broadcast transmission industry at the highest TV and radio network levels plus our two year involvement with wireless technology leader Qualcomm places us in a credible position to satisfy the operational needs of the mainstream telecommunications, wireless and infrastructure providers for RF and content delivery, as well as overall communications network and remote site management and control.
 
Our significant clients include Qualcomm - MediaFLO USA; General Electric - NBC Universal & Telemundo Television Networks; CBS Corporation Television and Radio Networks; The Walt Disney Company - ABC Television and Radio Networks; Cox Communications; Belo Corp. Television; Australian Government owned Air Services of Australia (the Australian equivalent to the FAA); Tribune Company Television; and Univision Communications Television and Radio Network. Some of our current sales channel and integration partners include Technology Associates International (“TAIC”), InfraCell, Harris Broadcast, Pixelmetrix, Nautel Navigation, BTS Ireland and Sound Broadcast Services, Ltd.

Products and Services

Our technology is a sophisticated control panel, or "dashboard style" management tool kit, linking digital and analog control, monitoring and information generating elements on a wide scale or narrow channel basis. We believe that pre-packaged, product-based solutions such as ours are replacing custom “in-house” software and integration services. Our proprietary technology products offer bi-directional telemetry for remote control, automation, self-healing and monitoring of devices, systems and facilities in real time, which result in improved operating efficiencies, top line revenue protection, resource reallocation, headcount reductions and a greater ROI. We believe our ”value-add” includes the ability to process and disseminate vast amounts of gathered information into real time management information, as well as predictive trends analyses and statutory compliance reporting packages.
 
Based on customer demand, we plan to launch monitoring services where we oversee a client’s NOC and network, as well as a “central server model solution”, which allows the data to reside at a Statmon facility. We believe that this offering will be attractive to customers who prefer outsourcing and paying for services as an ongoing operating expense rather than capital expenditure. We believe services or out-sourcing models are gaining popularity in the market place.


We have established a sound track record with dominant high tech corporations, including Qualcomm, MediaFLO, NBC, CBS, ABC, Belo, Cox and Harris where our products are considered highly stable and reliable and we have a reputation for being highly responsive to customers’ needs. Our products are scalable and are designed to offer substantially “off-the-shelf” solutions to assist customers achieve measurable improvements in their top line revenue generation, operating margins and more efficient asset management. In the government sector, we believe that our products can be applied to make time critical institutional, defense and governmental infrastructure projects, such as first responder telecommunications, power and water management, Homeland Security and other civic projects achievable and affordable within capital budget and timeline constraints.
 
Strict asset management and infrastructure security have become an increasingly important priority since September 11, 2001, facilitating a worldwide review of the needs for real-time infrastructure network monitoring, automation and remote site management capabilities. We believe that the prevailing environment presents a significant opportunity for us to incorporate appropriate features and functionality into our proven application software. For example, the major television networks are automating the FCC required Emergency Alert System (EAS) alarm system with our software, as well as monitoring their mission-critical transmission, microwave links, studio and facilities management operations. Localized EAS emergency broadcasting is expected to be integrated to the mobile TV and wireless markets.
 
In the short term we are focused on expanding into both the wireless and fiber communications infrastructure vertical markets. For the foreseeable future we will continue to adapt our proprietary software and integration technologies to provide real time monitoring and remote control capabilities across a wide range of network and infrastructure markets. We interface front-end custom screens, protocols, embedded software and systems integration to industry specific analog and digital devices, sensors and different types of disparate systems. We are aligned with six strategic sales channel or distribution partners who have pre-existing clients and worldwide install bases. Our products can also be employed as middleware and/or be part of complete end-to-end solutions with the major infrastructure vendors such as Ericsson owned Tandberg, Motorola and many others.
 
Software

Axess

The Axess software application remotely monitors devices, networks and systems where automatic control and response is required. With Axess, system operators and engineers can remotely manage outlying operations from a NOC down to the individual device level and rely on the system’s automation capabilities, as well as alarm notification, root cause analysis and fault descriptions, triggered when situations exceed a predetermined range or parameter. Axess can take immediate pre-programmed action on its own, such as operating a standby generator, monitoring the generator fuel supply, switching to a redundant system, segregating or resetting devices, running a control program, or disabling fault-causing issues. Axess operates on a Windows platform, is scalable and can simultaneously monitor large numbers of remote sites, right down to the devices level of the network.
 
rOVIng
 
Roving is the Company’s "thin client" used for remote access from anywhere on the globe. With a customizable graphical user interface, Roving allows the user to monitor, control and manage its network from anywhere. Via Roving, network operators can connect remotely through the primary Axess point and manage the entire enterprise via this single portal. Multiple clients can access the network simultaneously with no limitation. Display alarms and logs, import custom backgrounds, shapes and Adobe® Flash® objects to display and control your infrastructure with ease. Link multiple operator visual interface (“OVI”) screens allowing levels of detail and granularity previously unknown in technology management applications.


Accurate
 
Accurate is the Company’s solution for monitoring Local People Meter (LPM) data as deployed in the Nielsen Media Research LPM project across the U.S. Accurate can interface directly to both the Norpak® Universal Reader (NUR), and/or Nielsen Media Research's NACAT application. Interpreting decoded data from these sources Accurate can then alarm, notify, and log when discrepancies in LPM data occur. Accurate monitors four key components in the LPM data: final distributor system identification (“SID”), final distributor date/time information, program SID, and program data/time information. Once an inaccuracy is detected, Accurate can activate audio and visual alarms, notify operators and management via email, text, or voice, and log the discrepancy from onset to resolution, thus providing a verifiable document to assist in data correction from Nielsen® Media Research.
 
Hardware
 
UIF-32 (Universal Interface Unit)

The UIF-32 is a universal interface designed to allow Axess to collect 32 channels of analog, logic type and control information. The UIF-32 translates the General Purpose Input and Output (“GPI/GPO”) channels into serial or TCP/Ethernet data streams for process by Axess. The UIF-32 is a “passive” device, which means it simply relays information from devices, such as temperature sensors, door alarms and light switches.

UVM-6 (Universal Voltage Monitor)

The UVM-6 is a hardware interface that allows a host computer to accurately measure and monitor six different A.C. line voltage (mains) sources on a remote basis.

Key Features of Our Products

We have designed our proprietary software and hardware products with a number of key features to meet the needs of our customers in all markets, including:
 
 
·
Operator friendly;
     
 
·
Minimize field engineering travel requirements;
     
 
·
Ease of implementation, installation, maintenance, and upgrade;
     
 
·
Scalable and customizable;
     
 
·
Fully secure, including highest government approved encryption;
     
 
·
Ability to integrate the monitoring and management of a wide range of protocols and disparate systems and devices throughout a network;
     
 
·
Low-cost, off-the-shelf hardware and software, utilizing the Windows operating system, used in conjunction with a standard personal computer, laptop, PDA, or other handheld computerized device;
     
 
·
Real-time remote access, self-healing, control and monitoring of diverse systems, intelligent and passive devices across the network;
     
 
·
Real-time digital data collection, aggregation and information management services;


 
·
Automation, time and motion efficiencies through remote-site monitoring, managing and remote control capabilities from any web-enabled location;
     
 
·
Network and device automation, redundancy and "fail-safe" problem solving;
     
 
·
Top line revenue protection and insurance against system down-time by self-healing, preemption and prevention rather than cure; and
     
 
·
Preventative maintenance opportunities based upon trend analysis of collected data.
 
Customers

Our significant clients for our software and hardware products include Qualcomm/MediaFLO USA; General Electric - NBC Universal & Telemundo Television Networks; CBS Corporation Television and Radio Networks; The Walt Disney Company - ABC Television and Radio Networks; Belo Corp.; Cox Communications; Australian Government owned “Air Services of Australia”; Tribune Company Television; and Univision Communications Television and Radio Network. Some of our sales channel and integration partners include Technology Associates International (“TAIC”), InfraCell, Harris Broadcast, Pixelmetrix, Sound Broadcast Services, Ltd., and Nautel Navigation. These customers use our technology to manage their network and facilities to control, monitor, automate and manage transmission, audio, video and data.
 
The Company sold a substantial portion of its products and services to three customers during the year ended March 31, 2008. Sales to these customers were approximately $1,539,000 (54%), $219,000 (8%) and $135,000 (5%). The Company sold a substantial portion of its products and services to two customers during the year ended March 31, 2007. Sales to these customers were approximately $2,545,000 (69%) and $217,000 (6%).

Fiscal 2009 Goals

Our goals for fiscal 2009, given sufficient capital, are to:
 
 
·
Continue to develop the Qualcomm/MediaFLO relationship, including working with Telecom carriers, with emphasis on those adopting the MediaFLO Mobile TV platform, both domestically and through international partners, carrier user groups and individual operators;
 
 
·
Focus directly on all operators of Telecom wireless networks and communications infrastructure providers for sales of products and services;
 
 
·
Collaborate aggressively with Nautel Navigation and develop our exposure in the aviation navigation market including the FAA and all other air and sea navigational aid and beacon market opportunities;
 
 
·
Aggressively promote our software products, “Axess”, “rOVIng” and “Accurate” into the existing and expanding sales and distribution channels, including TAIC, InfraCell, Harris Broadcast, Pixelmetrix, Eddystone - Sound Broadcast Services, Ltd., and Nautel;
 
 
·
Focus on high profile product positioning and increasing our public relations exposure in the trade live television, magazine, internet and all identified infrastructure and technology markets;
 
 
·
Implement an aggressive investor relations, internet and public market making program to educate the financial markets about us and to generate liquidity in our OTC Bulletin Board listed common stock;
 
 
·
Expand our in-house sales engineering and channel business development team in the domestic and foreign markets;
 

 
·
Focus on the worldwide digital TV and radio transmitter retrofit cycle working with the transmitter, fiber and satellite hardware manufacturers and integrators;
 
 
·
Identify strategic vertical market collaboration opportunities in the aviation, shipping, energy, power management, military, government and corporate IT infrastructure markets;
 
 
·
Identify strategic infrastructure integrators and operators and complementary technologies for end-to-end solutions in the power supply, data center, wireless data delivery, embedded and sensor vertical markets.
 
Infrastructure and Network Management
 
In the rapidly evolving mass communications industry the major operators are deploying and upgrading wide scale infrastructure and networks comprising command and control network operation centers, remote sites, wide selections of incompatible technologies, alarm systems, hardware and devices from different manufacturers with disparate connectivity and operating systems. Management and control of these complex infrastructures require network wide and local engineering systems and platforms. In the event any element of a network or a remote site on the network is not functioning as designed, the primary functions may stop communicating or interacting per their intended purpose or per customer expectations of service. In many cases, a failure on the network may also cause a domino negative impact across the entire network.
 
The communications infrastructure industry encompasses the traditional television and radio broadcasters and all forms of telecommunications, including landline telephone and data, fiber rings, satellite, internet, broadband, mobile phones, wireless devices (lap tops or PDA’s), microwave data transmission, RF for first responders, law enforcement, air and sea navigation and emergency services. These networks typically have multiple remote sites, operations centers and network element operational issues which can be consolidated up to a single management system and central location.
 
When a commercial communications network is down (not on the air receiving or transmitting) there is typically a direct impact on the operators’ revenue generation, as well as on customer service and performance. Emergency engineering or resource reallocations to solve mission critical problems have a high cost factor, which can be significant in cases involving difficult to access or remote sites, such as on mountain tops, or locations in busy cities. Many network or infrastructure operational failures are power or weather related and can be proactively avoided or minimized.
 
For example, a storm comes through an area where a site is located, a power line goes down, the UPS (uninterrupted power supply) initially takes the full power load for a short period, the standby generator is started provided the starter motor battery is charged and there is enough fuel in the generator tank. This change of events can happen without the NOC or monitoring entity knowing anything or little more than the site is down and not transmitting (off the air). Operations at the site may remain stable until the generator runs out of fuel or the power comes back up and the site can switch back to the grid power. Typically, an engineer would be dispatched to the site to handle the restoration of the site to a normal or healthy condition. In the world today, there is a need for all the network elements and the health of remote sites to be managed and controlled all the way from the mission critical transmission technologies down to the individual periphery device and sensor level for all of the different technologies and equipment brands at the remote site and all layers comprising the network. We strongly believe the Statmon Platform addresses the emerging need for a highly flexible and universal manager of technologies in the multi-billion dollar infrastructure network industry.
 
Radio and Television Broadcasting Industry
 
Several significant rules issued by the Federal Communications Commission (FCC) of the United States in the late 1990’s opened opportunities for our products in the United States broadcast industry. These changes included (i) radio and other broadcast stations are allowed to operate “unattended”, provided a reliable remote control system is installed, (ii) station owners are permitted to own multiple stations in a single marketplace and broadcast multiple call signals from the same physical location, and (iii) stations are required to transmit both HDTV and analog television signals until February 2009.


These developments dramatically affected management and ownership structures in the radio and television broadcast industry. This is an industry that has traditionally been so competitive that radio and television station owners, management and employees would not even communicate with the teams from rival networks. The FCC rule changes have promoted rapid consolidation, making it common to find network giants such as ABC, FOX, and even new market share diluting competitors, operating out of a single building with common infrastructure and staff. We believe that these evolving broadcast industry circumstances will continue to provide on-going opportunities for us, including the central server model and the outsourcing of monitoring, remote control and services.
 
Software Industry
 
With the solid benefits offered by a web-enabled system, we believe the majority of large enterprises will now transition their software to this architecture over the next decade. In fact, many software vendors are rushing to develop new functionality that was previously cost-prohibitive under either client/server or mainframe systems.
 
As the software industry has evolved, so have the demands of enterprises purchasing software and integration services. Enterprises have become more discriminating and more influential in dictating their terms to the software industry. Enterprises increasingly want to buy from vendors who provide highly functional network based products within newer areas, such as remote asset and facilities management, system and device control and monitoring, supply chain and procurement, as well as in the bread-and-butter application areas, such as Enterprise Resource Planning (ERP). Leading-edge, web-based architecture is also coming to be seen as an essential need for operations. Moreover, companies are beginning to expect software vendors to bear an increased portion of the integration burden by developing out-of-the box connectors to common applications and devices.
 
Business Strategy - Potential New Vertical Markets
 
Given sufficient capital, we plan to continue to launch our products into an expanding range of vertical markets within the communications and infrastructure markets for a range of industries including microwave networks, power management, energy, municipal, Homeland Security, defense and governmental markets.
 
Any number of remote sites and devices can be networked and fully integrated for NOC control, multiple site automation, alarmed monitoring, management, remote control and/or the aggregation of real time information. Our products are designed to be robust and economically adaptable to a multitude of vertical markets. We are focused on the ongoing development of our products in consultation with our major clients and sales channel partner relationships. We intend to increase the number of Channel Partners with the objective of penetrating new markets where we do not have a presence and to enhance the perception of our ability to perform on major contracts.

Statmon’s validation by technology industry leader Qualcomm, as well as the major broadcasters, has permitted us to demonstrate the powerful functions, capabilities and stability of our core technology platforms. The current version of our proprietary software is designed to provide a low cost, non-customized solution to allow customers to monitor their networks in real time, in digital or analog mode, many different varieties and numbers of sites, systems and remote devices. Our goal in this regard is to market our software as a cross-industry, cross-application, enterprise, end-to-end or middleware solution that can demonstrate the same cost-saving efficiencies and fail-safe automation in a wide range of applications and markets as we currently do in the traditional broadcast, telecom - mobile TV, navigation aid industries.


Our product strategy is to directly promote and license our proprietary products to all levels of communications infrastructure and media broadcasters, as well as VAR’s and OEM partners like TAIC, InfraCell, Pixelmetrix and Harris Broadcast. We also intend to collaborate with equipment suppliers, infrastructure contractors and systems integrators like Tandberg and Motorola for Joint Venture, Strategic Alliance, and/or Private Label/OEM distribution across the virtually unlimited range of vertical markets. We believe that collaboration with powerful strategic partners will identify solution opportunities utilizing our products for monitoring, self-healing, automated asset management and/or remote control of technical operations, including the aggregation of data.
 
Our objective is to be perceived in the market as a leading network, remote site and facilities management, remote control, monitoring and universal solution provider with affordable economics. We give our new customers extensive training in our technology and its functionalities and provide materials and customer support for the on-going maintenance, monitoring and use of our products. We also provide high levels of support through our Channel Partners, so that our products and applications can achieve greater distribution and customer satisfaction.
 
We are identifying domestic and foreign partners and proceeding with our evaluation and development of a number of additional vertical markets, including the following:
 
 
·
Wireless and Fiber Infrastructure and Communications;
 
 
·
In Building Radio Frequency and Security Management;
 
 
·
First Responder, Emergency Services, Government and Military;
 
 
·
Energy Industry;
 
 
·
Wireless and Microwave Tower Management;
 
 
·
Homeland Security - Remote Control, Monitoring and Surveillance; and
 
 
·
Infrastructure - Remote Control, Monitoring and Data Aggregation.
 
Examples of our capabilities within these potential new markets include network operations centers and wireless multicasting transmission networks for mobile TV, microwave telecommunications networks for first responders, infrastructure, redundant power supply, remote site equipment and devices and other similar proactive real time control and management applications.
 
Competition

The management and control of sophisticated Network Operation Centers and the individual monitoring and remote control of remote sites, individual devices and disparate software systems is becoming a more diverse and competitive market. Companies such as IBM, Hewlet Packard, Nortel and Computer Associates offer various remote site, telemetry and network element solutions. Major hardware manufacturers offer a variety of network management, device management and control systems primarily to control their proprietary hardware and control systems. All the above mentioned companies have greater resources than Statmon.
 
Several hardware-based vendors provide monitoring solutions to the radio and television broadcast facility industry. Datapath is a direct software based competitor as is IBM, CA and Hewlett Packard. Burk-Gentner, Mosley and others represent a significant portion of the traditional broadcast marketplace primarily focused on transmitter monitoring. These products are quality offerings designed by companies and individuals who have strong industry contacts. These products are typically marketed directly to the engineering department at radio and television stations as a method of increased convenience. We believe that our products provide diverse functionality and powerful capabilities while delivering a more elegant, comprehensive, convenient and cost-effective solution to monitor and manage all of our customers’ mission-critical business operations.


For a number of years, many companies have targeted the manufacturing process and data center market with products similar in fit, form and function to us, including Hewlett Packard, IBM, National Instruments Corp., P.R.I. Automation, Kingfisher and Wonderware. These companies have achieved varying levels of success in the manufacturing and engineering design market space. Although it does not appear that these companies are focused on expansion outside their core solutions, they do represent a peripheral competitive threat to us.
 
We compete in markets primarily on the basis of the following factors:
 
 
·
Breadth of geographic presence;
 
 
·
Ease of integration;
 
 
·
Reliability;
 
 
·
Ability to offer turnkey solutions;
 
 
·
Customer service;