Electronic digital signage (EDS) is a prevalent, new advertising technology. It includes LED, OLED, LCD, CRT, plasma, digital or e-ink displays and digital-projection devices (a linked system may include one or more technologies). All are electronic, multimedia display systems.

Generally, and from a central (content-management) distribution center, the systems are fed electronic media (content) by either telephone-type lines or a wireless narrowcasting system to display changeable (still, animated or video) messages from a real-time or prerecorded source. Think of closed-circuit television, with oversized, science-fiction-type screens.

You're reading the first sign-industry survey of the electronic digital sign (EDS) business, but, right off, let us tell you that the EDS industry is more variegated than your grandmother's fruitcake, even if she didn't lob in the dried bananas.

Be aware, also, that this is an in-house assessment (whereas ST's annual "State of the Industry" surveys are professionally and independently prepared), meaning, our staff implemented and analyzed this information, as with the Neon/Lighting Survey (see page 108). We're good, but we're not CPAs, so don't think you're reading a set of figures you can fax to your banker.

Here, you'll See trends, and, if you're a careful reader, you'll find an assortment of interesting information and ideas. Some may increase your profits.

To gather this information, we mailed (and e-mailed) survey forms to approximately 300 EDS-related companies. We wanted to gather information from outside the known sign industry, so we built our mailing list from various sources, including Web searches and press releases. For balance, we included a few ST LED-display manufacturers.

Because our list was homespun, the undeliverable return-mail (e- and snail) tally was high -- a count of 50 -- which cut our outreach to approximately 250 in-service companies. From this 250, we received 38 valid responses, a respectable 15%.

We believed we'd receive more responses from the regular mail forms than e-mail, but the final count was a tie. The beauty of e-mail distribution was that people could, and did, fire back immediate questions. Many were concerned that we'd publish the survey answers alongside their name, which we didn't.

A few simple definitions will explain our earlier use of "fruitcake." In EDS, for example, the term display can describe LED, OLED, LCD, CRT, plasma, projection systems, and electroluminescent or electronically activated ink panels.

Content defines the images the EDS system displays -- for example, words, graphics or videos of racecars. This category can include high-definition digital photos and television systems (for best results, EDS displays require HDTV) and the software for creating these images and graphics. There's also Internet HDTV software for sending high-definition television signals via the Internet.

Content management is the system for directing, timing and scheduling content. A third apparatus is computer-routing systems, that is, the hardware and software that channel the content to the content-management-systems director, who forwards the coded signals to the display. There's more -- Wi-Fi (wireless) systems (see CAS/Tech Update, page 16) and "flexible OLED" for example -- but, for now, we're drawing a line in the sand.

The truth is, systems are infinite and the opportunities boundless. Typically, all the players are reaching for the brass ring. Fig. 1 gives you an idea of our survey's responding companies' mixed focus.

Fig. 1: This chart shows how diverse these 38 companies are; in fact, only five companies listed one enterprise only (also see Fig. 3). Twenty-six firms reported their primary focus thusly: 15 LED, 14 LCD, 12 plasma, 7 CRT, 7 graphic/video production, 7 projection, 2 E-ink and 2 OLED. Of this mix, 62% call themselves systems integrators and 46% say they're display manufacturers, but the replies intermingle when it comes to servicing or installing software or hardware systems.

Survey participants include display and lamp manufacturers, software and display builders, systems integrators, content creators, systems managers and more. Because of such a varied mix, we divided our statistics into four classes that seemed to click into place on the returned surveys: companies that work with more than one system, and companies that work with LED, LCD and content (Fig. 2).

Perhaps our best "fruitcake" example is a systems integrator's answer to the question, "In what segments of EDS technology is your company involved?" The response: "Audiovisual systems, computer graphic design, computer/signal-routing systems, display installation, display manufacturing, display signs, program software, retail displays, story production and video production."

Fig. 2 displays the varied mix of interests among survey participants. In all, respondents' product categories include display and lamp manufacturers, software and display builders, systems integrators, content creators, systems managers and more. Because of this diversity, we divided our statistics into four classes: companies that work with more than one system, and companies that work with LED, LCD and content. Only five respondents indicated his or her company worked in only one field.

In all, 34 (89%) of the 38 respondents were working in more than one EDS category. It's interesting to note that 23 (61%) of the companies included software (creation, sales or installation) in their product descriptions, and 16 (42%) were also involved in scriptwriting, story or video production.

We also learned that one prominent LED manufacturer has produced, and is selling, a digital-signage network software; another is now involved with LCD displays and, simultaneously, is tied into programming software, audiovisual systems and video production.

It doesn't take a Harvard Business School degree for display-manufacturing executives to grasp that adding content to their product menus equals more profits. It provides ongoing income after the initial equipment sale. See it in the same light as digital-print-machine manufacturers see ink and media -- in EDS, content is the consumable. Accordingly, you can expect the larger display firms to either buy or build media-creation companies.

Fig. 3 illustrates the concept. It says that nine media/content employees could generate more than $700,000 in annual sales.

Fig. 3: This chart gives you a comparison of dollar/sales-per-employee. As expected, content-providing companies realize a lower divisible amount than manufacturers. Remember, however, that manufacturing equipment and operations costs more than similar expenditures in the content-producing field. Thus, even though the content producer's dollar/sales-per-employee amount may be lower, its ROI, and profits, may be higher.

Twenty-six respondents reported an impressive $302.1 million in sales for 2002. Combined, these 26 companies employ 527 people.

The highest reported income was $148 million, followed by $21 million; the low was $200,000. Because of the extensive span (and variety of business categories), we didn't average sales figures. It just wouldn't make sense. We did drop the top-dollar company sales figure when calculating the Average Sales per Employee chart (Fig. 3). This chart reveals that content-providing companies can expect a lower dollar-sales-per-employee ratio than EDS manufacturers or display resellers. Fig. 3 also shows the significant income difference between hardware-specific companies and those working with content.

Our survey respondents listed four primary sources for income: sign and display manufacturers, systems resellers, retailers and "others." "Others" includes such diverse enterprises as process-control rooms, schools, flight-information systems and entertainment or special-event companies. Also, the nondescript "end-user" term appears several times in this field. Fig. 4 indicates the number of companies focusing on each market area. When looking at this, remember that only five indicated his or her company worked in only one field.

Twelve companies revealed they had business-sharing agreements with other firms (some mentioned such names as Mitsubishi, Fujitsu, GE and Sylvania). A remarkable 69% of respondents said they market internationally, 25% nationally and 6% regionally.

Fig. 4 Our survey respondents listed four primary sources for income: sign and display manufacturers, systems resellers, retailers and

The following count, based on 38 firms reporting, will give you an idea of the type of technology in which these companies are primarily engaged: 15 LED, 14 LCD, 12 plasma, 7 CRT, 7 graphic/video production, 7 projection, 2 E-ink and 2 OLED. Of this mix, 37% call themselves systems integrators, and 24% say they're display manufacturers, but the replies intermingle when it comes to servicing or installing software or hardware systems.

Interestingly, LED-based companies average 20 employees, with an average-sales-per-employee figure of $200,000; companies offering more than one technology average 28 employees with a divisible dollar rate of $175,836; and those companies that focus only on content average nine employees with a dollar/employee figure of $79,370.

We believe a company indicates its commitment to a specific technology through the dollar amount it has budgeted for research, development and marketing. High R&D dollars indicate a company is committed to growth; high marketing dollars indicate the company has hot, new products to sell.

Twenty-seven respondents indicated an increased marketing budget (2002-2003), and 22 indicated an increase for R&D during that same period. The reported mark-up? 4-1,000%. The R&D average increase (we dropped the 1,000%) is 28.6%, and the marketing average is 34.3%; both strongly indicate interest, growth and, again, hot, new products.

Like any other businesses, EDS companies eye each other's territories. It's the grass-is-greener theory. A Northwestern company, for example, wants to move into the specialty and fast-food market. A Southern firm plans to expand into security systems, and another is researching the transportation business. Other fields of interest are groceries, tradeshows, kiosks, education, government and video production.

The question, "What do you see as important steps to be taken before the EDS field becomes more commonplace than it is today?", received the most interesting and emphatic answers. The high cost of displays was the prime gripe of 15 respondents, while six worry about zoning regulations, and seven believe educating buyers will make EDS ubiquitous. Here are some direct quotes:

"Lower display prices."
"More reliable forms of content distribution; cost of displays coming down."
"Cost-effective digital displays in large-format."
"City code changes are mandatory."
"Sign-code reform."

A bookish company spokesperson said commonplace acceptance would arrive via a "paradigm shift from analog [static] images to digital, changeable images." Our favorite response expressed a common desire of all people everywhere: "Get rid of companies that don't know what they are doing."

Oh, if we could only add politicians to that aspiration.

A New York City-based company summarized: "We need to demonstrate the value proposition -- an improved ROI -- of this new technology to marketers by showing the way outdoor media and other EDS applications can communicate with consumers."

Amen to that.

Susan Conner, ST's senior editor, assisted in the research for this article.

Survey Participants The following companies participated in this survey, although, for their own reasons, not all provided full information. In explanation, one said, "We prefer to keep our cards close to our chest." Adtronics, Delta, British Columbia, Canada; Advanced Display Technology, Beaumont, TX; Adworks Digital Display System, Hillsboro, WI; Alive Promo Inc., Minneapolis, MN; Artistic Resources, Seattle; Big Board Media Inc., San Francisco; Captive Audience, Vernon, NJ; Clarity Visual Systems, Wilsonville, OR; Daktronics, Brookings, SD; Datatronic Control Inc., Rowlett, TX; Electronic Display Systems, Grand Island, NE; Epicure Digital Systems, Beverly Hills, CA; Grandwell Industries, Holly Springs, NC; HiTech Electronic Displays, Tampa, FL; Imatech Corp., Mandaluyma City, Philippines; Impart Inc., Seattle; Innovative Design Technologies, Van Nuys, CA; Kaesu Inc., Morristown, NJ; LEDtronics Inc., Torrance, CA; Magink Display Technologies Inc., New York City; Marketing Communications, Las Vegas; Media Now, West Caldwell, NJ; Mercury Online Solutions, Bainbridge Island, WA; MPO Videotronics, Newbury Park, CA; Newground Resources, Manchester, MO; Nuclear Digital, Portola Hills, CA; OnSite Media, Las Vegas; OpenEye Display, South Amboy, NJ; Osram Sylvania, Danvers, MA; Plasma Extreme, Endicott, NY; Pro-Lite Inc., Costa Mesa, CA; SoundStage Systems, Heath, TX; Tribar Industries Inc., Downsview, Ontario, Canada; Venue Pop, Seattle; Visioneered Image System, Lake Forest, CA; Vizicast Multimedia Inc., San Francisco, CA; Voltarc Technologies Inc., Waterbury, CT; and Xstream Solutions, Atlanta;