is this "pay-dirt"?, page-10

Thanks for the comments Mal - I think you are being too simplistic in your analysis of USCOM's market.

I have followed this company for 5 years - closely for the last 3. The money you say was spent on sales, was mostly spent on indirect things that established the unique nature of the device and its place in the medical world - conference attendance and exhibition attendance, getting licenses and patents, sponsoring research, developing educational media, researching add-ons - the small staff never found much time in their day to actually get out and sell - sales were a by-product of getting product acceptance. You can say this was a failure of management, but I believe it was a conscious planned approach. If UCM came unstuck anywhere it was in the time it would take for their science to be accepted by the market.

You need to consider that when the USCOM device first hit the market, it provided an elegant answer to one of the age old problems of medicine - how to measure blood flow through a working heart without doing some damage in the process. This had been one of the great challenges of medicine. A wide range of solutions have been tried and some companies were heavily promoting their solutions, the majority of which were complicated or inaccurate. Along comes USCOM with a simple elegant solution that worked with a demonstrable accuracy. Some Medicos just refused to believe it worked - too simple! Some were confused by the "smoke" spread by competitors. Some were confused by the science and got it mixed up with Echocardiography (diagnostic ultrasound) which is expensive and produces an ultrasound image of the heart, it evaluates morphology (structure). It should not be confused with USCOM which measures blood flow by the Doppler Shift in an ultrasound beam. Many had no time to investigate what the story was all about - and if they liked what they saw they needed to add it to their list of wishes in a future budget.

Hospitals are a major market - Medicos are always under stress - short on time and short on money. It can be demonstrated that USCOM can provide savings on both, but market acceptance can only come when this is the generally accepted wisdom and decision makers do not have to find the time to research the facts for themselves. I believe we are approaching this point now.

I do commend the UCM management for the way they have built their reputation in the medical community - absolutely "copy-book" .... "Softly, softly - catchee monkey" as they say. I think all this is factored into the current share price.

Re Spacelabs branding - yes I did know, UCM made a public announcement about that. You could consider in the bargaining that went on in establishing this relationship that they may have offered some naming rights in preference to giving away margin. I guess I am saying one does not necessarily follow from the other. We should get a better idea in the next quarterly report just what UCM's share is.