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Show Sunday Morning, September 30, Section F Huh nttwwy t f ' vr Hewlett-Packar- Utah Medical Inc., which had sales last year of $701,257, is still far from the size of Sorenson Research Co. or Deseret Medical. But like Utah Medical, those two companies were once small new companies manufacturing disposable medical products. They later became multimillion dollar businesses. Utah Medicals management is convinced its company is in the same tradition. : J vf rzfaj . The small Lehi company was recently given a lift in its bid to repeat the success of those two companies: Co. signed In July, Hewlett-Packar- d a five-yea$6 million purchasing agreement with Utah Medical for a product the company developed. r, Utah Medical workers assemble products in clean room at facility in Lehi, where products are designed, manufactured. The firm markets disposable hospital items. I 1 d By Guy Boulton Tribune Staff Writer V- - wir Page Contract Revives Utah Medical Inc. VT MffA fi 1984 Moreover, Utah Medical projects its sales will triple this year to $2.3 million and will jump to $5 3 million in 1985 on the strength of the Hewlett-Packarcontract and the growth of its other product lines. There is just as much potential in this company as Deseret Medical or Sorenson Research had, said Ralph S. Walker, vice president and secretary-treasurer of Utah Medical. Early Setbacks Utah Medicals prospects have never looked better. Like most new companies, though, Utah Medicals y five has been marked by setbacks. As recently as last spring, Utah Medical was delicately close to bankruptcy. At its annual meeting last May, president Fred P. Lampropou-lo- s bluntly told shareholders the company "desperately needed additional capital. Nonetheless, Mr. Lampropoulos maintained the future has never looked brighter for Utah Medical a declaraction at odds with the companys dismal financial statements. The company had lost $1,143,993 in 1983, which more than halved the companys net worth to $1,020,776 from $2,130,418. And this year wasnt turning out much better. The company lost $380,003 for the first six months, its net worth dropped to $640,686 and current liabilities outstripped current assets by $303,601. Six weeks later, Hewlett-Packar- d Co. announced the purchasing agreement. In addition, Hewlett-Packarwhich had sales of $4.2 billion last year, agreed to a $1 million advance payment and two additional advance payments totaling another $1 million over the next several months. Received Needed Capital Abruptly, the companys prospects changed. Utah Medical had the capital it desperately needed. Utah Medicals Lehi facility befits a small start-u- p company. The company is located in a yellow and white metal building that it shares with an industrial pump and parts manufacturer. The manufacturing and mold shop is in a separate concrete building bordering a field. The setting is an unlikely one for a medical products company. But lam d year-histor- d, inated copies of patents held by Utah Medical hang on the walls. And the management of Utah Medical, about half of whom have worked for Deseret Medical or Sorenson Research, likes to note that both those companies started in equally modest surroundings. The company has clearly outgrown its cramped and crowded facility There is room to maneuver around the desks, but not much else. In November, the company will move to a manufacturing 35,000-square-fo- and design facility in Midvale. The facility will double the size of the companys current facilities. The company, which has 75 employees, will also add 25 employees when it moves to the new facility. Its workforce, which works four shifts, is now working an extra day to keep up with demand. Started in 1979 Events are falling into place for the company that was founded in 1979 with a $70,000 Small Business Administration loan and an idea for a disposable flushing device used in monitoring blood pressure. But the crisis the company faced last spring was not the first time Utah Medical had hit hard times. Although its sales its first year were about $350,000, the company was sued in its second year by Sorenson Research for patent infringement. The lawsuit, which was eventually settled put the company out of business for seven months and close to bankruptcy. That year, the three founders J. Reed Chidester, James E. Young and Mr. Walker were introduced through a mutual friend to Mr. Lampropoulos, a former broker for Boettcher & Co., and was hired as a consultant. He was made an equal partner in 1981. Lost Major Customer One of Mr. Lampropoulos first moves was to raise capital through taking the company public in 1982. Utah Medical netted about $1,650,000 in a public offering of 2,250,000 shares at $1 per share. That year the company earned $78,230 on sales of $716,517. The company was back on track in 1983 but suffered another setback See Page F-- Column 1 2, Publications Byte the Dust as Computer Magazine Market Folds By Skip Wollenberg Associated Press Writer The heyday is over for expansion in the computer magazine business. New magazines were entering the market at the rate of one a week a year ago, but today they are going out of business almost as quicklNEW YORK y- Analysts say the shakeout was inevitable, and estimate no more than 20 to 30 magazines will survive from a peak level of up to 200. A main reason for the shakeout, the analysts say, is that advertising revenue was spread toe- thinly and that advertisers have become more selective. They say some computer owners, who may have bougit their computers on the spur of the moment, have lost interest, while more committed owners are demanding consistently high editorial quality in computer magazines. Nurtured By Problems And finally, they say the shakeout has been nurtured by problems with the computers themselves. There were far too many publications who jumped into this trying to catch the crest of the wave and ride with it, said James Callan, vice president for marketing at C Systems Ltd., a magazine advertising research firm in Ridgefield, Conn. The growth in computer advertising revenue has been impressive, Callan said, but so was the explosion of computer magazines. He said his firm estimates computer publications collected $145 million in ad revenue in 1982, $275 million in 1983 and may get $520 million this year. No definitive figures are available on how many computer magazines are published. But those who follow the industry closely say there were about 70 at at the end of 1982, between 150 and 200 in the fall of 1983 and 75 to 100 currently. Parallels Growth Efrem Sigel of Communications Trends Inc., a Larchmont, N.Y., publisher that monitors computer publishing, said the computer magazine business paralleled growth in the computer business itself. For a time, there was a vaccuum and a hunger for information, Sigel said. Information buyers were somewhat indiscriminate in what they bought, and advertisers were also somewhat indiscriminate on where they put their advertising. Some magazines dealt with specific models of computers, some with the Industry in general and others V. with the software that makes computers work. They relied heavily on advertising from companies that make computers and peripheral equipment, and a few ran 600 pages or more. But the market for new publications passed the saturation point in the fall of 1983, the analysts say, and a shakeout began. Those still going strong include general interest magzaines such as Byte, Compute!, Personal Computing and Popular Computing as well as some that deal with only one machine, such as PC and PC World, which focus on IBMs Personal Computer. Failed to Anticipate But others such as PCjr, Microsystems, Personal Software, PC & PC Junior, and List have either been phased out, folded into other publications or appear less frequently. David Ahl, one of the pioneers in computer publishing who founded the increasingly popular Creative Computing magazine in 1974, said many computer magazines failed to anticipate a changing mood in the market. Some computer magazines appearing for the first time in late 1983 were conceived in 1982 in response to the computer game craze, he said. These magazines were coming in just as customers were saying they wanted to move on to more serious applications, he said. Sigel at Communications Trend said computer magazines also bene-fitte- d briefly because buying a coman in thing to do in 1982-8was puter 3. Blame Manufacturers There was a lot of fad involved in the computer boom, he said But how many people are going to wade e magazine through a 100-them how to tells month that every use it? The average consumer just isnt going to invest his time and money in it. Publishers blame difficulties with some computer models for some computer magazine fatalities. Publishing Co. published its first monthly issue of PCjr magazine in February, shortly before the arrival of its namesake computer, manufactured by IBM. The PCjr computer ran into problems, however, because of the design of its keyboard, which has since been replaced, and the capacity of its memory, for which expansion attachments were later made available. Eileen Markowitz, senior vice computer president for or 200-pag- Ziff-Dav- is Ziff-Dav- is k publication business, said that in addition to those problems, the PCjr did not develop the unique audience that thought it would. Since already had three other publications about IBM products PC, PC Tech Journal and PC Ms. Markowitz said it was Week decided that the November issue of PCjr will be its 10th and its last. That wasnt an isolated occurrence. ABC Publishing, a subsidiary of American Broadcasting Companies Inc., suspended its PC & PC Junior as Ziff-Dav- is a separate magazine in October after six issues, because it had not attracted enough advertising, spokesman William J. Liss said. Ziff-Dav- is Lives On The monthly publication lives on, however, as a separate section of ABC Publishings Compute! and Computers Gazette magazines, which Liss said are doing very well. Software, magazines have proven vulnerable to the magazine shakeout. Hayden Publishing Co. Inc.s Personal Software magazine disap- - peared after the October issue. Hayden said it had been integrated with its Personal Computing magazine, which continues to appear under that name, into a separate publication called Personal Computing Plus. In a letter to advertisers, publisher Robert J. Lydon said Personal Software was aimed at a market that simply did not materialize as expected. List, another software publication, was published monthly for a year starting in October 1983 but has reverted to a semiannual schedule. Its founder, Ted Leonsis, said the advertising revenue was simply insufficient for a monthly software magazine. C Systems Callan suspects some magazines had trouble collecting for advertisements. Many computer magazines that failed looked relatively good even at the moment of their death. They were carrrying a lot of ad pages, so clearly a number of these ads were not being paid for, he said. He said both advertisers and publishers have become more cautious. New Phone Book Look Is Becoming Less Aesthetic As Regional Companies Seek to Boost Identities By Geoffrey Quinn Associated Press Writer NEW YORK The breakup of the Bell System has, unsurprisingly, brought many changes in the way phone companies do business. But, perhaps unexpectedly, for some people it also has meant the death of the telephone book cover with the bucolic or homey local scene. Two of the seven regional companies resulting from the breakup have decided to adopt a uniform look for their books as a way to strengthen their corporate identity. Nynex, the operating company that covers New York and New England, has embraced the logo look. No photographs, no scenic illustrations, just a high tech grid of blue and white with a fuzzy yellow-greenis- h comet trail across it. The design already is appearing on some phone books, and the company says it will used throughout its region by next July. It also is being used on yellow pages books. Mary T. Magncr, spokeswoman for the Nynex publishing arm, said the company took the radical step after assessing all of Nynexs 260 different phone books and deciding, It didnt look like the same company. Susan Barnum, also of Nynex Information Resources, added: They are going to know it is a Nynex Information product when they see that grid pattern. Also parting with the past is Southwestern Bell, serving Arkansas, Missouri, Oklahoma and Texas. The company said it will put a graphic, which includes the copyrighted bell logo, on many of the 464 editions of its white page and yellow page phone books. - We wanted the consumer to know that cover was being published by Bell for Bell and nobody can use that cover but us, said Ron Jennings, vice president and general manager of Southwestern Bell Media. As for its use on the white pages, We kind of wanted to come out as a new company, said Larry Marullo, Southwesterns director of advertising. He said the simple generic design also would bring some cost savings. In the past our covers had asthetic appeal, he said. The importance of that is something we will have to judge. For now, at least, the other regional operating companies are being more reverent toward the memory of South, which operates in much of the Old South, said his company will con- tinue to present rural scenes under the companys standardized format. The Atlanta area white pages are the only exception this year, using a graphic cover showing a globe effect with the bell symbol and a telephone, Clay said. ly I think the local telephone company wanted to speak to divestiture last year, he said. Divestiture being over and done with, I would tend to think that photos will be scenic. US West also is staying in the camp, but is still trying to local-pictu- re corral its various phone companies in 14 western states into agreeing on some sort of design consistencies for a cover, said spokeswoman Robbin Parker. Were all over the ballpark. Bell Atlantic, serving the Atlantic coast from New Jersey to Virginia, is staying with separate covers for its directories, because our customers have had a lot of changes already and this is one we can spare them easily, said spokesman Jay Grossman. Theres a certain relationship between local phone companies and their customers, he said. Theres no reason to run away from that. Ma Bell. Pacific Telesis, the operating company for California and Nevada, says it sees good customer relations in maintaining ties to the old relationship of the American Telephone & Telegraph family. Customers can be reminded who owns their company much more subtly than using a uniform, companywide look said Greg Silveria, a project director with the consulting firm that designed Pacific Telesis phone book covers. The logo look misses the point on the white pages, he said. You lose that personal touch. That human element is important, said Lon Argabright at Pacific Telesis Pacific Bell division. We want to stress that we are a personal kind of utility. Pacific Telesis solved its identity problem by standardizing cover graphics throughout the two states, but leaving room for a localized photograph or illustration in the center. Neal Clay, a spokesman for Bell- - LvU'UuvIl V ILlhw) U by Brendan Boyd PRESIDENTIAL SPENDING CHANGES Administration Defense Spending projected SOURCE: OfUce of Metnagofneni 9nd Budget U Non-Defen- se & |