July/Aug 2004

Do users yearn for the familiarity of a paper record alongside the sophistication of a digital file? Destiny Wireless thinks so, and Peter Rowlands hears why from chief executive Edward Belgeonne

"The paperless office is a complete fallacy," says Edward Belgeonne, chief executive of Destiny Wireless. "People still want paper records of transactions. And they're not comfortable signing for things with electronic signatures."

All of which, if true, certainly helps explain why his company is seeing such rapid growth. Its core technology, the digital pen, plays to users' instinct to stick to the tried and tested, yet it also harnesses some extremely clever technology to add an electronic dimension.

Result: users get a familiar paper record plus a digital record, all at the same time. Out in the field, staff have little to learn that's new; and if all else fails, the user-company knows it can always fall back on the paper version. But behind the scenes, the digitally captured data gives users the best of both worlds.

In the era of the laptop and tablet PC, the PDA and the smart mobile phone, this kind of belt-and-braces approach to data-gathering might seem a throwback to an earlier time, but its fast-growing popularity seems to confirm that it's a technology people want. Little more than a year after its full UK launch, Destiny Wireless already has more than 170 business customers, and currently it has about fifty live projects under development.

These are no small applications; one user, face-to-face marketing company The Cobra Group, has ordered no fewer than 5,000 digital pens in a contract valued at £2 million. A law firm has recently put a hundred pens into use. Already there are said to be approaching 7,000 pens in use in the UK, and that is clearly just the beginning.

The pens use a technology developed by Swedish company Anoto, for which Destiny Wireless has become country agent for the UK, South Africa and Australia. Anoto is represented on the Destiny Wireless board by Orjan Johansson, so effectively Destiny is its formal sales and development arm in all these markets.

A variety of companies manufacture the actual pens, including Logitech, Maxell, Nokia and Sony Ericsson. They all differ in detail, but work on the same basic principle. The pen has a standard ball-point tip, and can be used in the normal way to create an ink trace on paper; but pen strokes are also detected by a tiny digital imager built into the device, and are saved to on-board memory (a capacity of 1 megabyte is typical).

The information can then either be stored for batch download later, or be passed via Bluetooth wireless local connection to a mobile phone or PDA, and transmitted from there directly back to base over a data network such as GPRS or GSM.

To be able to detect the pen strokes, the system must be used with "Digital Paper", which has a minute and virtually invisible dot pattern that is unique to each sheet. But this is not unduly expensive; Belgeonne says it typically adds only about 2 to 5 per cent to the normal price of the paper, and points out that a number of standard paper products are already available from leading manufacturers such as 3M, Charles Letts, Esselte, Hamelin and John Dickinson.

Input can be captured in two ways. The quicker and simpler way is for the user to tick pre-determined "fields" on the printed page (for instance, selecting the date from a list of options, or ticking "OK"). The layout of the page has to be set up in advance, of course, so that the software recognises the meaning of the fields. The page then effectively takes the place of an interactive computer screen.

But the pen can also store freehand text. Belgeonne points out that strictly speaking it captures pens strokes, not characters as such; but a PC-based software package called MyScript by Vision Objects can convert these into text. He claims that it can achieve an accuracy of 97 to 98 per cent - "and the overall accuracy is more like 99.8 per cent, because some information is always taken directly from ticks on pre-defined fields."

One of the undoubted attractions of the concept is that the pens are so inexpensive compared with other data capture devices. A typical price would be around £125, which is cheaper than the cheapest PDA contender for serious business applications.

But that's only the beginning of the cost savings, argues Belgeonne. "Training is a big issue with mobile computers, whereas the pens need virtually no training at all. And when mobile computers break, they simply don't work, whereas the pens are fail-safe. Even if the electronics go wrong, they can still be used to make a paper record.

"There's also a big issue over limited battery life, especially with portable printers," he says, adding that pens have a writing life of about two hours between charges - far more than would be required in most typical field applications.

Belgeonne accepts that there are applications where tablet PCs, PDAs or laptops will always present the most logical option. "But that still leaves a vast section of the potential market for which digital pens are a better choice."

Interestingly, not all users actually keep the paper records created by the system. One company reportedly uses Sony Ericsson Chat Pens in a field application that triggers action by a call centre, and once this happens, the paper record is apparently discarded.

A further option is the kind of application where the "paper" record is actually a permanent laminated card, which users tick rather as they might swipe a barcode. Typical applications might be for attendance records, or to register daily vehicle inspections.

There is a possibility that the pens might eventually be able to swipe real barcodes. They can't do this at the moment because the tiny inbuilt camera focuses on such a small area of the page, but Anoto is understood to be working on the idea.

Belgeonne says that even in the relatively short time the company has been marketing the Anoto system, there has been a swing from batch data capture to instant real-time wireless communication. The wireless approach is slightly ahead, "but only at the level of about sixty to forty."

He says users are gradually becoming more accustomed to GPRS, which he thinks is now achieving the right level of robustness. "And if there are any breaks in transmission, they're not a disaster as the pen data will be sent the next time you do 'send' request."

One potential objection sometimes voiced by would-be customers is that fact that unlike most other forms of portable computer, the pens can't in themselves provide any visual feedback to users. However, Belgeonne points out that they can offer audible and tactile feedback to confirm input, "and that's often all that's required." For users who insist having a visual interface, the display screen of a mobile phone can substitute for a built-in screen, so the company already has that eventuality covered.

Destiny Wireless itself has a multiple role in all this. The company has its own sales, marketing and development teams, and can deal directly with big customers on sales and implementation; but Belgeonne is expecting most business to be handled by specialist "channel" resellers and distributors, of which one of the biggest is BT. "I see our role as primarily to drive the market," he says.

The company has been methodically establishing partners in a range of vertical markets, which so far include marketing, legal, pharmaceuticals, utilities and construction. The latest is Geneva Partnership, which specialises in the financial sector. Destiny is also working on joint implementations with industry leaders such as Accenture, Hewlett-Packard and Oracle.

Prior to setting up Destiny Wireless with partner Stephen Winyard, Edward Belgeonne was heavily involved in the telematics market. He brought together two existing players to create the Orchid business, which was subsequently sold to the French-based Thales group.

Belgeonne retains a strong affection for the telematics business, but says he found the market frustrating. "There's an addressable market of six million vehicles in the UK," he reckons, "yet only 200,000 to 300,000 of them have telematics systems installed. You have to ask why."

He has his own explanation. With tongue perhaps slightly in cheek, he comments: "The British love what they call 'driving efficiency', yet hate confrontation and accountability. In other words, they don't like situations where they have to tell people what to do. There's a significant resistance to making people work harder."

Telematics and vehicle tracking systems, of course, are all about giving businesses the information to do these things, so if his analysis is right, it is perhaps no wonder that there is resistance in some quarters to adopting them.

Digital pen technology, by contrast, offers a much broader range of business benefits, which is why Belgeonne feels pens offer more potential. "They represent a phenomenally enormous opportunity for everyone involved - not least the users," he says.