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Up and Coming
Three other Knoxville Internet companies that are making waves.

  The Big Picture

When it comes to cutting-edge Internet technology, Ipix is Tennessee's hands-down leader. Here's what the company is up to next.

by Mike Gibson

It's a sunny SoCal afternoon, and I'm cruising the byways on a Harley, tooling the outskirts of an L.A. 'burb. The road stretches out and yawns before me, open with promise. I look to my left and see one of my running buddies, his sandy mane pouring out from underneath his helmet, tickling the wind. Behind me is my other mate, bearing down hard on my rear. I look down, watching the broken yellow stripes on the road pass in endless, rapid succession, reeling me in to some nameless destination...

All of which is pretty cool, if not outright amazing, given that I don't own a motorcycle, that I couldn't ride one even if I did, and that I live some 2,000 miles from the City of Angels. Actually, to the casual observer, what I'm doing bears absolutely zero resemblance to a Cali cycle run—standing in a sparsely-appointed corporate office in Oak Ridge, holding what looks like a space-age version of one of those old Viewmaster toys to my face, and generally looking foolish as my head swivels around the room, my face a mask of dorkish amusement.

In some sense, I'm also looking into the future, playing with the new Video-360 technology currently in development at Ipix, Tennessee's chief contribution to cutting edge Internet technology. It's only one of many visual wonders at the company that now stands as the world's most innovative new player in 'net photography.

Now employed on more than 5,000 websites net-wide, the company held its initial public offering in the summer of '99. Its brief but explosive rise to the forefront of Web imaging constitutes what may prove to be one the biggest business stories in East Tennessee history, a technological accomplishment of singular gravity in an area already known for its high-tech pedigree.

"What Ipix is doing represents the first major change in photography since color film," says Ed Lewis, vice president of marketing at Ipix. "Pictures were being taken today in essentially the same format as they were 150 years ago—a staid, flat image on a page or a screen."

The change Lewis is talking about is "photobubble" technology, the imaging system that allows Internet browsers to enter and explore a particular scenario, expanding radically on the ordinary two-dimensional viewing experience.

Imagine standing in the center of a room and taking a photograph with a wide-angle, fish-eye lens, then making a 180-degree turn and snapping a second pic. The two photos constitute the scene in its entirety, albeit in drastically distorted form.

Ipix software allows for the seamless blending of the two images such that the room can be surveyed as an undistorted whole, as if the viewer was operating a remote control surveillance camera with the ability to "pan" 360 degrees or zoom in for close-ups.

Since its introduction on the Worldwide Web less than five years ago, the photobubble has shown great potential in the realm of e-commerce, promising to revolutionize on-line marketing in fields such as real estate, travel, and entertainment. "It's an innovation that, for the first time, draws people to the Web because they can get more from the web than from looking at a piece of paper," enthuses Ipix president Jeff Peters.

George Farris of local Web design firm IBI employed Ipix technology in crafting a website for Fox Toyota in Clinton, a site later used by Ipix in its bid for the national Toyota account. While he acknowledges drawbacks to the process—it adds download time and has proven less useful for smaller operations—he says the technology holds "fair promise" in large-scale applications for real estate, automobiles, and the like.

"I'm not sure that adds so much to a smaller site," says Farris. "But for larger ventures, it's potentially a very useful tool."

But what Ipix has become has little to do with what local scientists Lee Martin and Paul Satterlee had in mind when they broke from Oak Ridge National Laboratory and founded Telerobotics, Inc. in the early 1990s. Their original concept—to design remote, visually operative robotics for applications too dangerous for direct human contact—was altered first when they were employed to devise a more efficient remote camera for NASA, and then by the advent of all things Web. "We had no idea how the popularity of the Internet would come along and change everything," Martin chuckles.

As Martin and Saterlee's remote visual experimentation unraveled new possibilities, the company name was changed to Omniview, a moniker more descriptive of its fledgling technology. And the newly-evolved photobubble caught on with a handful of savvy cyber-marketeers, including Toyota, which offered on-line photobubble viewing of vehicle interiors.

Even more significantly, Omniview attracted its first major external investor, Motorola, in 1994. And with Motorola would soon come CEO Jim Phillips, former wizard of the Skytel Corporation, and the corporate momentum that would propel Omniview to the forefront of Web technology.

"The explosion was inevitable; people like to see things, and the Internet has gone everywhere," says Martin, who has since parted with the company on harmonious terms. "The key was getting someone strong enough to publicize (the technology). Jim Phillips and Motorola have done an excellent job of expediting the marketing process and taking it to the mass market."

Perhaps the one act most symbolic of the firm's commercial coming-out, Phillips changed Omniview's name in 1997 to the more user-literal Ipix, a switch Martin admits "shows the difference in perspective of a technical guy versus a marketing guy."

Says Peters, Phillips' vision was to capitalize on the boundless potential of e-commerce. "A huge amount of e-commerce is driven by visual contact, and we provide very compelling visual contact," says Peters. "I don't enjoy reading 2,000 words on a PC; I'd rather read it on paper. So what can you offer that will draw me to the web, that I can't get from reading a magazine or looking at a piece of paper?"

Ipix looked at potential growth industries in terms of what Peters calls the "bowling pin theory." Once the first pin topples, the rest fall in rapid succession. "The trick is that first pin is Velcroed to the floor," Peters says.

Ipix labored for six months to land its first contract in the cruise ship industry, convincing the Carnival company to provide Ipix tours of some of its ships and destinations. Once Carnival signed on, however, all of the other major industry players fell into place. "As soon as we sign on with one company, all of the other websites become non-competitive," Peters explains.

In little more than three years time, Ipix imagery has made huge inroads with real estate companies (Coldwell Banker, ERA, etc.; offering Internet tours of properties); the hospitality and travel industry (Hyatt, Marriott, Carnival; on-line viewings of accommodations); a host of diverse e-commerce players (IBM, GM, etc.); and the entertainment industry, where Ipix technology offers virtual tours of everything from movie sets to sporting events.

These successes have blown the once-tiny company up from 15 employees in 1996 to nearly 200 (a figure that will rise again when Ipix completes an announced merger with, a Palo Alto company that produces virtual tours). Its market valuation, meanwhile, has ballooned from little more than $20 million to $1 billion, a figure that ranks Ipix far above any other net-related enterprise in the state.

"This apparent growth seems to be for real, at least for the time being," observes local portfolio manager Robert Loest, an expert on Internet-related stock. "What sets them apart is that they've brought in management from other tech-savvy companies, and that they seem to understand the value of connectivity, doing deals with companies all over the world. In making moves like the bamboo merger, they create an ecosystem where all of the companies involved play off one another. That's how you add value now; they seem to 'get it.'"

Lewis sees Ipix poised for raucous, take-no-prisoners entry into two more new areas in the coming years. In the realm of direct consumer applications, a partnership with Olympus could enable home photographers to take their own Ipix-style digital photos instead of standard videocam home movies and Polaroid snapshots. "Thanks to improvements, it's getting to the point where we can put the technology in the hands of local photographers," Lewis says. "It was a very complex process. But because of better software and partnerships with the camera companies, now anyone can do it."

And Ipix is already leading the charge in the development of so-called webcams, video cameras that offer on-line viewing of pictures taken only moments ago. Lewis says industry analysts predict that more than 12 million new webcam applications will hit the Internet in the next few years. "I think webcams will become essential," says Peters. "Imagine, for instance, being able to see your child at daycare during a break from work."

But if these developments seem remarkable, the promise of Video-360 (remember the virtual motorcycle ride?) is unparalleled. With the cross-pollination of Ipix and digital video, all of the aforementioned applications have the potential to become live, interactive, virtual. "I think we're headed for a virtual age, and Ipix is perfectly positioned to take us there," says Martin.

As an entertainment medium, Video-360 may one day permit viewers to sit in the middle of a rock concert, or take a panoramic, you-are-there gander at a sporting event. Lewis says even movies may one day be filmed in a 360 degree environment, giving audiences latitude in how they choose to view a given scene.

And combined with immersive viewing instruments like the previously mentioned virtual reality goggles, V-360 could revolutionize teleconferencing, telecommuting, and travel by permitting face-to-face interaction between people at remote locations. "Virtual interaction is coming, and when it gets here, everything changes," notes one local observer.

Ipix's ascendance hasn't come without a measure of controversy; some 'net-heads grouse that the Ipix patents are too all-encompassing, laying legal claim to simple applications better left in the public domain. Lawsuits concerning potential patent infringements are currently pending.

Martin, for his part, dismisses any such white noise as patent SOP. "If it's a good patent, it's over something simple that everyone would like to use," he says. "It's over the stuff where everyone says 'I should have thought of that!'"

According to Dr. Michael Berry, a University of Tennessee computer science prof with a keen eye on the 'net, the patent squabbles are only one more indicator of the hurricane impact this still-infant Oak Ridge company has had on the most significant new technological field of the coming century.

"The patent stuff—that's the nature of software development; it's one thing to do 85 percent of something and quite another to do the final 15 percent," says Berry. "(Ipix) is truly a unique enterprise—not at all your typical start-up. This is the kind of company that we should all be rallying behind."