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1992-09-30
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{1992 Corporate Backgrounder
Artisoft designs and manufactures a full product line of low-
cost, award-winning software, hardware and systems for local area
networking.
["Our mission is to create innovative connectivity solutions]
[that improve the productivity of the business community."]
{ - Jack Schoof, President and CEO}
Founded by Jack Schoof (pronounced "shoaf") in 1982 through
private investment, the company recently went public, selling
2,875,000 shares of common stock in September, 1991. The offering
generated $42,838,000 to be used for general corporate purposes.
Jack Schoof first saw the need for PC connectivity when he formed
Artisoft in 1982. His was a small business that, like most small
businesses, needed to run efficiently if it was going to succeed.
So he set out to create a solution that would allow small
businesses like his own to link their PCs together to communicate
and share resources. The LANtastic Local Area Network - a peer-
to-peer network that provides a flexible system in which all Pcs
can share every peripheral and every resource on the network - is
the result of his work.
Since Schoof founded Artisoft, his company has grown from one
employee to more than 300 and from renting a storefront office to
owning a three-building complex and renting separate production
and warehouse facilities. In addition, Artisoft has established
international subsidiaries in the United Kingdom and Japan.
{Local Area Network Market Overview}
More and more small- to medium-sized businesses (less than 500
employees) are turning to LANs because they want to save money
and increase productivity by sharing expensive peripherals,
automating data handling, and implementing other time-saving
applications such as electronic mail. Because most small
businesses do not have a readily available MIS manager or
extensive in-house technical support, they need simplicity
combined with functionality.
Larger companies (more than 500 employees) use LANs because they
allow corporate users to operate independently from minicomputers
and mainframes, yet still maintain access to the information
residing on those larger computers. MIS directors have found that
connecting PCs via LANs is more cost effective than via
minicomputers and mainframes.
There are two networking technologies available in the market
today - peer-to-peer and client server. While client-server
networks have been designed to meet the needs of the few, the
large corporations with ample budgets; peer-to-peer networks have
been focused on the needs of the many, the small- to medium-sized
businesses that constitute the bulk of the market.
Artisoft has developed and targeted its products to small- to
medium-sized businesses, and in just four years has installed
more than 1,000,000,network nodes and more than 210,000 LANtastic
Local Area Networks worldwide. Artisoft sales in fiscal 1988 were
$2.1 million, $6.6 million in fiscal 1989, $21.1 million in
fiscal 1990, and $41.1 in fiscal 1991 and 74.3 million in fiscal
1992.
The peer-to-peer network market has grown from 2 to 20
competitors in the last four years. Even the leading client-
server network manufacturer has entered the market, thus further
establishing peer-to-peer as a viable network alternative.
{The LANtastic Local Area Network}
Artisoft's LANtastic Local Area Network is a leader in the DOS-
based peer-to-peer LAN market because it addresses the needs of
the small- to medium-sized business market. It offers a powerful,
full-featured, easy-to-use networking solution that is not only
priced affordably, but also allows businesses to network their
existing PCs instead of purchasing expensive high-powered
computers to act as dedicated servers. Because it requires a
minimal amount of a PC's RAM, it also eliminates the need for
expensive memory upgrades.
Also, it's flexible. Every network computer can act as a server,
workstation or both, and all programs, data and peripherals on
the network are available as shared resources and accessible to
everyone. Plus, it is intuitively easy - to install, to learn, to
use and to administer - without compromising efficiency or
features. It only takes about 15 minutes to install each
LANtastic node, which offers many of the same features as the
larger networks.
The LANtastic Local Area Network continually offers improved
features and greater performance as well as working with other
operating environments.
LANtastic Starter Kits offer a complete hardware and software
networking solution for two PCs- two Artisoft adapters, LANtastic
NOS supporting up to 300 users, cabling and documentation from
which users can add nodes by installing additional adapters and
cabling. This one-stop solution is valuable and convenient to
Artisoft resellers and endusers alike because Artisoft develops
and supports the entire package. LANtastic Starter Kits allow
users to build their networks around their choice of Ethernet-
standard or propriety adapters, 10BASE-T and/or coaxial
connections, ISA or Micro Channel buses.
LANtastic for Windows network utility lets users run the
LANtastic network (version 4.0 and above) from within Microsoft
Windows 3.0 and above. This separately purchased utility offers
the same features as the DOS version's NET and NET_MGR programs,
but within the easy, graphical user interface (GUI) of Microsoft
Window's pull-down menus, icons and on-line help. It supports
Dynamic Data Exchange (DDE) so that Windows applications can use
LANtastic e-mail to exchange messages and transfer data.
LANtastic for NetWare software brings the LANtastic network's
peer-to-peer features to Novell NetWare users. In addition to
peripheral-sharing, it allows NetWare users to expand their
network without purchasing an expensive NetWare upgrade and acts
as a valuable backup network that keeps operating when the
NetWare server or network is down. It runs on top of Novell's
NetBIOS emulation and requires Novell's NetBIOS to operate.
LANtastic Z Local Area Network is the serial/parallel/modem
version of the LANtastic network. Because it is a zero-slot LAN,
it does not require adapters, which makes it an invaluable
business tool for notebook and laptop users.
LANtastic/AI Local Area Network is the adapter - independent
version of the LANtastic network. It is packaged with software
drivers for running the LANtastic network on other manufacturer's
adapters.
LANtastic for Macintosh software or software/hardware solution
brings the two worlds of Macintoshes and PCs together through a
PC gateway. Files and PostScript printers can be shared. And,
perhaps best of all the Macintosh users see their familiar MAC
Icons and the PC user interface is what they are used to seeing.
{Artisoft's Connectivity Solutions}
Artisoft also continues to broaden the Artisoft product line -
developing hardware and software connectivity solutions and new
capabilities like NetMedia and voice - that work with other
networks as well.
Artisoft Ethernet Adapters are in 100% compliance with IEEE 802.3
Ethernet standards. The AE-3 ( 10BASE-T, thin and thick coax
cabling, the AE-2 (thin and thick coax cabling), and AE-2/T
(thick coax and 10BASE-T cabling) Ethernet adapters are all 16-
bit adapters and NE2000-compatible. The Artisoft AE-1/T (10BASE-T
cabling) Ethernet adapter is an 8-bit adapter and is software-
compatible with Novell's NE1000 adapter. All four adapters are
available for ISA bus PCs and the AE-2 Ethernet adapter is also
available in a Micro Channel version.
LANtastic A2Mbps adapter was designed as a low-cost alternative
to industry - standard Ethernet adapters. It features 32K of
onboard, dual-ported RAM to minimize use of the PCs' working
memory and a 10Mhz coprocessor to free the PCs from almost all
network processing. Also available is the E2Mbps for Micro
Channel.
Central Station connectivity processor is a modem-sized multiport
device that provides a cost-effective solution for connecting
(with thin coax or 10BASE-T cable) a variety of peripherals
including notebook computers, printers and modems-to a LANtastic
or NetWare Ethernet network.
Peer-Hub concentrator is a complete 10BASE-T hub that resides in
a host PC, XT, AT or EISA computer (ISA mode only) and has five
external 10BASE-T ports and three special internal connectors
designed to connect to other Artisoft products.
ArtiCom modem-sharing software allows cost-effective asynchronous
COM port sharing - modems, faxes, serial printers and plotters -
on any LAN operating under NetBIOS including Artisoft's LANtastic
and Novell's NetWare networks.
The Network Eye remote control program lets users broadcast their
screens to or remotely view the screens and control the keyboards
of up to 32 PCs at one time.
{NETMEDIA}
NetMedia is the term coined by Artisoft to describe an
integration of informational elements prepared and distributed
via a network. The end result of this process is a content-rich
information source called a NetMedia document. NetMedia documents
integrate text and graphic data elements that are in common use
today, as well as new data types such as voice and music.
ArtiScribe NetMedia document and dictation system is the first
product to embody the NetMedia concept. It allows PC LAN users
equipped with Sounding Board adapters to integrate voice, text
and graphic data into a NetMedia document and distribute it to
other ArtiScribe users on the network.
{VOICE
Sounding Board adapter, a low-cost IBM-compatible expansion
adapter with a telephone-style handset, converts between
audio/voice signals and a digital data stream. Its SoundPUP(tm)
utility allows users to record messages as DOS files from within
applications.
Voice Programmer's Interface software allows developers using the
Sounding Board adapter to quickly and easily add voice, sound,
music and other audio enhancements to their own applications.
{NetMedia Starter Kit}
The NetMedia Starter Kit-- An all-in-one solution that provides
users with a fast and efficient peer-to-peer network that
delivers multi-faceted documents composed of sound, graphics and
text. Take advantage of the easy-to-use graphical user
interface, DDE and OLE capabilities of Windows 3.1. The Kit
brings together several of Artisoft's award- winning products in
a complete, single-provider Network solution. The NetMedia
Starter Kit includes the LANtastic Network Operating System, the
LANtastic for Windows network utility, two Artisoft AE-2 Ethernet
adapters, two Sounding Board adapters with telephone handsets,
cabling and documentation.
{Industry Awards and Recognition
When Artisoft engineers began developing the LANtastic Local Area
Network product line in 1986, innovative design and affordability
were key considerations. The results of their creativity and
cost-consciousness are powerful networking solutions and LAN
applications that require very little memory, are easy-to-use,
feature-rich and low-cost.
{Artisoft, Inc.}
{o} 1991 Arizona Innovation Network's Innovator of the Year
Award for Computer/Software Innovations
{o} 1991, 1990, 1989 Inc. Magazine's Inc. 500, the list of the
500 fastest-growing privately-held companies in America
{o} 1991 Connecticut Mutual/US Chamber of Commerce/Nation's
Business Blue Chip Enterprise Award
{o} 1991 Beacon Foundation for Mentally Retarded Special
Recognition Award 1990-91 LANDA Chairman's Award
{o} 1990-91 LANDA Executive Director's Award
{LANtastic Local Area Network}
{o} 1992 LAN Times Reader's Choice Award
{o} 1992 LAN Magazine Product of the Year for Entry-level
Network Operating Systems
{o} 1991 PC Magazine Editor's Choice for DOS-based LANs
{o} 1991 LAN Magazine Product of the Year for Entry-level
Network Operating Systems
{o} 1991 LAN Times Readers Choice for Peer-to-Peer Networks
{o} 1990 PC Magazine Editors' Choice for Peer-to-Peer Network
Operating Systems
{o} 1990 PC Magazine Editors' Choice for CD-ROM Networking
{o} 1990 LAN Times Recommended for Networking
{o} 1990 Systems Integration Product of the Year Finalist for
Local Area Networks
{o} 1989 PC Magazine Editors' Choice for Low-Cost LANs
{o} 1989 PC World Best Buy for Low-Cost LANs
{o} 1988 PC Magazine Technical Excellence Nomination
{o} 1988 BYTE Magazine Award of Distinction
{LANtastic Z Zero-Slot Local Area Network}
{O} 1990 PC Magazine Editors' Choice
{Central Station(tm) Connectivity Processor}
{o} 1991 BYTE & Interface Group's Best of Spring COMDEX in
Connectivity
{Artisoft AE-3(tm) Ethernet Adapter}
{o} 1991 PC Magazine Best of 1991
{Artisoft AE-2(tm) Ethernet Adapter}
{o} 1991 PC World World Class Award for LAN Boards
{Sounding Board Adapter (formerly LANtastic Voice(tm))}
{o} 1990 PC Magazine Technical Excellence
{The Network Eye Local Area Network Remote Control Program}
{o} 1988 LAN Magazine Product of the Year
{International Awards}
{o} 1992 PC Plus Recommended for LANtastic Local Area Network
(UK)
{o} 1992 PC Plus Recommended for LANtastic for Windows Network
Utility (UK)
{o} 1991 Computer Buyer Best Buy for LANtastic Local Area
Network (UK)
{o} 1991 Computer Shopper Best Communications Product (UK)
{o} 1991 Which Computer? Best Buy for Local Area Networks (UK)
{o} 1991 Mikro PC Editor's Choice for Peer-to-Peer Networking
(Finland)
{o} 1991 Mikro Data Product of the Year (Sweden)
{o} 1991 Capital Data Magazine Networking Product of the Year
(Norway)
{o} 1990 PC World Product of the Year (Norway)
{Artisoft's 1992 Strategy}
{MARKETING AND PUBLICITY}
Artisoft markets and publicizes its products through advertising
campaigns, direct mail, telemarketing, product and corporate
publicity, media relations, LANDA membership, enduser and
reseller seminars and programs, and trade show participation at
COMDEX, NetWorld, PC Expo, FOSE, and a variety of smaller shows.
International Support. In February 1991, Artisoft established
Artisoft UK, a wholly owned subsidiary with responsibility for
marketing, distribution and sales throughout Europe. In December
1991, Artisoft established Artisoft Japan K.K. with
responsibility for promotion, marketing, adaptation, distribution
and technical support of Artisoft products in Japan.
{CHANNEL SUPPORT}
Business Development Group (BDG). In 1991, Artisoft formed the
Business Development Group (BDG), a cadre of top-flight sales and
technical specialists who have been stationed in major markets
across the country to conduct seminars and to assist Artisoft
resellers in sales and support of Artisoft products.
Artisoft Authorized Five Star Resellers. In 1991, Artisoft also
introduced the Artisoft Authorized Five Star Reseller program
which offers added discounts, support and services to highly
trained resellers.
Enduser Programs. In 1992, Artisoft begins a dedicated effort to
support its endusers by offering Artisoft training seminars and
by establishing users groups.
Customer Satisfaction. In 1991, Artisoft enhanced its technical
support system by adding a state-of-the-art automatic call
distribution system to process calls faster and to distribute
them to specific product support groups. Artisoft offers free,
unlimited telephone, fax (Facts Fax) and on-line (BBS) support to
registered endusers and resellers by phone. In addition, Artisoft
has set up a toll-free sales information line, 1-800-TINY RAM,
and has joined CompuServe's PC Vendor Forum so that CompuServe
subscribers can access information about Artisoft and its
products.
{DISTRIBUTION
Domestic Distribution. Artisoft sells through more than 27,000
authorized resellers in the United States. Ingram, Merisel, and
TechData are distributing Artisoft products and several major
chains have picked up Artisoft products, including Canon,
CompuAdd, CompUSA, Computer City, Computer Factory, Dell, Egghead
Discount Software, Global Computer Supplies, INMAC, Radio Shack
BizMart and Soft Warehouse.
International Distribution. Artisoft sells internationally
through distributors in Argentina, Australia, Austria, The
Benelux (The Netherlands, Belgium, Luxembourg), Canada, Chile,
France, Iceland, Greece, Hong Kong, Israel, Italy, Japan, Mexico,
New Zealand, Pakistan, Poland, Scandinavia (Denmark, Finland,
Norway, Sweden), Singapore, South Korea, Spain, Switzerland,
Turkey, and West Germany.
{Corporate Officers
C. John (Jack) Schoof II, President and CEO. Jack first entered
the industry in 1972, at the age of 14, as a professional
programmer. By 17, he had started his own consulting company. He
earned a B.S. in Electrical Engineering at the University of
Arizona while working at the campus computing center as a
consultant to the professors. From there, he went on to Hughes
Aircraft where he designed hybrid integrated circuits for the
Phoenix and Maverick Missiles.
He founded Artisoft in 1982, designing telecommunications
software, peripheral-sharing devices, PC clones in 1985, and as
early as 1986, the LANtastic 2Mbps adapter and user interfaces to
the LANtastic network operating system. Jack now oversees a
company that employs more than 300 people, and as President and
CEO, is directly involved in the engineering research, design,
development, and manufacturing of all Artisoft hardware and
software products. His outside interests include music synthesis,
soaring, scuba diving and photography.
Alex Karahalios, Vice President of Product Development. Alex is
responsible for new hardware and software development as well as
feature enhancements to the LANtastic network. During the
creation of the LANtastic network, he designed the LANtastic
NetBIOS, Redirector and Server. Alex holds a B.S. in Electrical
Engineering from the University of Arizona and has worked in the
computer industry since 1976. His outside interests include the
development of novel consumer electronics and man/machine
interfaces.
William D. Baker, Chief Financial Officer. Bill joined Artisoft
in early 1990, bringing 20 years of high-tech financial
experience to his new position. Prior to Artisoft he served as
the corporate controller for Burr-Brown Corporation, a $200
million multi-national semi-conductor manufacturer; and as an
officer and corporate controller for CTS Corporation, a $275
million multi-national electronic component manufacturer. Bill is
active in the Financial Executives Institute's Committee for
Employee Benefits and the Tucson Chamber of Commerce's
legislative and education committees. In his free time, he enjoys
watching and participating in sports, reading and traveling.
Dennis R. Weyrauch, Esq., General Counsel & Corporate Secretary.
Dennis joined Artisoft in 1990 to provide legal counsel in
business matters such as general corporate, real estate
transactions, contracts and employment law. He also interfaces
with other attorneys doing work for the company. Dennis earned
his undergraduate degree in computer science from St. Thomas
College in Minnesota and his law degree from the University of
Arizona. He has worked in the legal profession since 1983 and
enjoys downhill and cross-country skiing, racquetball and
cycling.
Dave Hallmen, Vice President of Sales & Marketing. Dave is one of
Artisoft's original ten employees and joined the Artisoft Sales
Department in 1988 shortly after the LANtastic Local Area Network
was introduced. His experience in sales and computers enabled him
to contribute significantly in developing Artisoft's successful
sales programs, policies and procedures. Dave was promoted to
Sales Manager then National Sales Manager before his present
position. His outside interests include racquetball, golf, and
weightlifting.