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The price point will also be set in accordance with the data gathered from our target market research. A promotional message will need to be finalized and an advertising agency selected in order to help us build our promotional campaign. The promotional message will vary depending on the target market, focusing on different elements of the product. Two main features of all promotions, however, will be building brand awareness and promoting the product's innovative technology. Building brand awareness is critical because the brand is unknown at this time. By developing a brand, we will be positioned to extend that brand in the future. The main selling point of the device will be the technology. This message will be positioned more in light of what this technology allows the customer to do -- the coolness of the device is not in the algorithm but in the power it gives the user. This aspect will be heavily emphasized. The finer points of the promotional message will be solidified on the basis of the marketing research that we will be conducting in the months prior to launch.

We will need to determine our distribution strategy as well. Our existing channels are likely sufficient, but this product may be more specialized than our usual products. There are also likely to be additional channels for this product that we do not currently utilize (book stores, for example). As a result, we will need to undertake a careful analysis of the potential retail channels for this device. Once we have a sense of our retail strategy, we will need to focus on the distribution channels that will allow us to access those retail outlets. We must also determine our Internet marketing and sales strategy -- do we offer the device on our website or do we go through a third party retailer such as Amazon?

The funding needs of this project are significant. We feel that the software will be fully ready in about six months' time, and we will need a development team working on that. Developing the marketing plan will also be costly, due to the extensive amount of research needed for this new product. It is estimated that the total development costs of the Babelfish are going to be between $1.5-$2.0 million. After six months of development, it is expected that the Babelfish will be ready to take to market. This process will require a further six months to iron out the production and distribution functions, and to begin our marketing campaign. The...

All current devices in the market are dramatically inferior to our groundbreaking technology. Current handheld translation devices will need to respond by competing on the basis of price, as they will all be immediately relegated to low-end status. This will allow us the high end niche to ourselves. A company like Google is a more major threat as it is believed that they have the capability to develop a speech algorithm as sophisticated as our own. They operate in portable devices through their Nexus One product. As such, they represent a significant threat to our business. The lead time for such a response is expected to be upwards of one year, however, giving us time to build our business.
There may be potential threats from companies not currently in this space. Companies that are designing translational software for devices like the iPhone or iPad may be able to eventually emerge as competitors. Essentially they would be mimicking our strategy except using another company's device whereas we have a proprietary device.

The Future

In the next three to five years, we see significant product development and brand extension. In order to head off potential competition utilizing established portable devices, we expect to create variants of our software that we can sell as applications on Apple, Blackberry, Nexus One and Palm devices. This would allow us to corner the market, and save competitors from the expense of developing their own software.

It is also believed that improvements in nanotechnology will allow us to shrink our device. It is very much conceivable that the Babelfish, within three to five years, could resemble a device not much larger than the fictional babelfish that lives in the person's ear. The device would be little more than a Bluetooth-style earplug with high-powered translational capability.

The other potentiality is that within the outer end of the three-to-five-year timeframe, we will see many other uses develop for the speech recognition software that we are close to finishing. This could represent for the company entirely new lines of business, and if we move quickly enough we can gain first mover advantages in the speech recognition market.

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