Pulse beats fast in the tech world

By Lawrence D. Maloney

Coming off a solid 2005, area companies built around technology look forward to another stellar year ahead.

"It’s all about execution," says Scott Pearson, CEO of Protonex, a Southboro manufacturer of fuel cells. "The opportunities are there."

For Protonex, major contracts with the military, as well as a development alliance with automation giant Parker-Hannifin, made 2005 "the best year for us by a mile," according to President Scott Pearson. Among important projects, Protonex introduced a 30-watt fuel cell to supply continuous power for devices that military personnel use in the field, such as radios, night-vision goggles, and global-positioning equipment.

The system, which will begin field trials in the first quarter of 2006, provides enough power for a 72-hour mission but weighs 60 percent less than conventional battery packs. It also offers increased ruggedness and reliability, including a wider temperature range.

On the commercial front, Protonex and Parker-Hannifin have teamed up to develop portable 150 and 500-watt generators for industrial use. Protonex supplies the fuel cells, and Parker provides pumps, valves, seals and manifolds to complete the system.

With such projects underway and prospects for more military contracts, Pearson sees employment at the five-year-old firm growing in 2006 from 29 to 40, with the biggest demand for electrical and mechanical engineers. Key feeder schools for new hires: WPI and Northeastern.

AMSC: Superconductor business heats up

American Superconductor, Westboro, also points to a blend of government and commercial projects that has boosted revenues fivefold over the last four years, according to CEO Greg Yurek. With $58.2 million in sales in its most recent fiscal year, AMSC sees several milestones ahead for 2006 that may fuel further growth.

In May, the company expects to deliver a 36.5 megawatt (50,000 horsepower) propulsion motor to the Navy. Featuring the company’s high-temperature superconductor (HTS) wire, the system weighs one third as much as conventional motors that use copper wire construction. If trials prove successful, the HTS motors could be propelling Navy ships by the end of the decade. In the first quarter, AMSC is anticipating another Navy contract for an electric generator to be paired with the superconductor motors.

Aside from military applications, AMSC is a prime contractor in what will be the first U.S. application of superconductor wire in transmission cable for a power grid. Under a Department of Energy program, AMSC is supplying HTS wire in a pilot project expected to be completed and energized on Long Island in September. The initial installation by the Long Island Power Authority extends a half mile, but could be increased to five miles. AMSC also is participating in another DOE pilot in Columbus, OH, expected to be operating in mid-2006. It will feature a 200-meter-long HTS power cable to serve the distribution load fed from a large substation.

Yurek sees such projects as the start of an emerging trend to replace copper with superconducting wire. The principal advantage: HTS wire can conduct more than 150 times the electricity of a comparable-size copper wire. He believes that advantage will become more pronounced, as U.S. power demands increase. "Electricity now meets 40 percent of the country’s energy needs, up from 25 percent in the early ‘70s," says Yurek, "and that percentage could climb to as much as 70 percent in the next 15 years.

Among other notable projects for 2006, AMSC will be delivering the first commercial quantities of its SuperVAR condenser to The Tennessee Valley Authority. This product helps stabilize voltages and improve reliability at a time when the power grid is delivering more electricity and power lines are under stress.

AMSC also is working with the Central Japan Railway Company in test runs of magnetically-levitated trains that use electromagnetic coils powered by HTS wire from American Superconductor. In a December 7 trial, the train reached speeds as high as 311 mile per hour, while levitating about four inches above the track. JR Central noted that the tests proved that HTS can be applied to superconducting maglev and that the technology would bring substantial costs savings if a new Tokyo to Osaka line were to be built. For AMSC, such a project could mean a demand for 60,000 miles of its HTS wire.

Delivering on these contracts—and finding new ones—will pose a big challenge in 2006 for AMSC and will determine whether the firm expands its workforce beyond the current 195, says Yurek.

IPG: Out with the old

IPG Photonics, the Oxford laser manufacturer, is another firm leveraging new technology to drive sales. The company’s fiber lasers offer 25 percent efficiency in converting electricity to laser energy, versus just 4 percent efficiency for YAG lasers, claims Bill Shiner, director of New Market Development. He adds that the IPG design is also more compact and requires a much smaller chiller for cooling, which saves customers valuable space on the factory floor. In addition, the fiber lasers can typically operate 100 thousand hours without replacing diodes—more than five times as long as conventional diode bar, according to Shiner.

IPG cites those advantages as the key to a doubling in revenues for industrial applications in 2005, and "we could double again in 2006," says Shiner. Customers use the lasers for cutting and welding in applications ranging from auto bodies to medical pacemakers. Other markets include computer disk drives and laser marking of parts for identification.

When the company’s scientific applications are included, total sales in 2005 climbed to more than $90 million, up from $60 million in 2004. With factories in the U.S., Germany, Russia, and Italy, IPG employs 700 worldwide. The company’s Oxford headquarters employs 250, and "we are hiring as fast as we can," notes Shiner. About 20 percent of the staff hold doctorates in such fields as material science, physics, and photonics.

To handle the new business, IPG built a 50,000 square foot facility on the Oxford campus in 2005, and is already pondering another expansion in 2006. Says Shiner: "The big challenge for us is growing fast enough to keep up with the demand."

Flomerics: Electronics on the rebound

Whether it’s a cell phone or a computer server, the design of electronic products follows one dominant direction: Pack more features into a smaller envelope. But crowding more components into less real estate poses the risk of heat buildup that can damage devices. That’s where Marlboro’s Flomerics, Inc. comes in. The company makes software that helps design engineers analyze potential thermal problems, as well as simulate design solutions without building multiple physical prototypes. Result: faster design cycles, increased reliability and reduction in material costs.

Not surprisingly, as the electronics industry goes, so goes Flomerics. And right now, business is good. "Clearly, the electronics industry has been on a rebound, and that’s good news for us," says Andy Farrington, regional director of the U.S. operation of Flomerics, a UK company. Revenues in 2005 having been running about 20 percent ahead of 2004 figures. Major customers include: Bose, Dell, Raytheon, Intel, Cisco, Delphi, and Visteon—just to name a few.

A key driver in Flomerics’ business, says Farrington, is the comeback of telecom. The need to move more data across the Internet calls for the design of higher performance servers and switches. Other companies, ranging from Google to Reader’s Digest, also need simulation software to ensure proper cooling and air flow in their vast data centers. And despite the current troubles in the auto industries, the electronics content in cars has increased enormously, boosting the need for more thermal analysis.

With companies like Intel expanding their design centers, Farrington sees continued good business in 2006. Another important customer, Boston-based Teradyne, has completed the restructuring of its automated test equipment businesses and will be on the upswing in 2006, predicts Farrington.

His worries for the new year? "I’d been concerned if the electronics industry had a hiccup, but I don’t see that happening," says Farrington. "There’s lots to do, and the challenge is setting the right priorities."

SEPATON: Harnessing a

disruptive technology

For SEPATON, a two-year-old company with a revolutionary technology, success in 2006 hinges on its ability to outwit goliath competitors like IBM and EMC in the fast-expanding field of data protection.

Instead of computer tapes, long used at companies large and small to back up data, SEPATON has developed a Virtual Tape Library that employs disk drives, servers and proprietary software to emulate computer tape libraries. The result, according to CEO Michael Worhach, is backup performance 10 times greater than conventional tape systems.

Mounting evidence shows that the need for such "tapeless" alternatives is growing. In a recent survey of IT executives sponsored by Asigra, another data backup company, 75 percent of respondents reported that their companies had suffered unrecoverable loss of data that they thought had been backed up by tape.

In November, SEPATON got a big lift in pursuing this lucrative market by securing $15 million in new venture capital funding to accelerate product development. To get its new technology to market faster, says Worhach, the firm in 2006 will be outsourcing more-routine development work to software engineers in India. Marlboro-based engineers will focus more on advanced work.

Earlier in the year, the company inked a major deal with Hewlett-Packard in which HP integrates SEPATON software on its own hardware, which sells as the HP StorageWorks 6000 Virtual Library. The HP alliance in turn has helped SEPATON expand its customer base to nearly 200 worldwide. As a result, the company has been doubling its revenues quarter over quarter for the past year, according to Worhach, though it does not disclose specific sales figures. The firm also tripled its office space in its move from Southboro to Marlboro in 2005, and expects to grow its workforce from 75 employees to 100 in 2006.

"This is no longer just an emerging technology, but one that presents real opportunities," says Worhach. "We have established a leadership position with our S2100 Virtual Tape Library platform and are winning benchmarks against much bigger companies."

Alpha Labs: Sleuthing for

pollution

Reclaim a brownfields site. Rehab a deteriorating building. Convert a military base to civilian use. Those are just a few of the scenarios that call for analysis of air, water, soil or debris for hazardous substances, and Westboro’s Alpha Analytical Labs is New England’s largest company in that business, according to President Marc Woelfel.

In 2005, the lab grew revenues by 6 percent and also acquired Woods Hole Group, a Raynham lab known for analysis of petroleum and other contaminants in oceans and waterways. Woelfel says business in 2005 was tied to solid activity in the commercial construction industry. And while government contracts have slowed, the firm is still doing analysis work at the converted Army reservation in Devens.

For 2006, Woelfel expects only modest growth at the lab, which employs 100 in Westboro. "Environmental rules are a major driver for our business," says Woelfel, "and it has been a quiet time for new regulation." Even so, Alpha is opening a new sales office in Bedford, NH, to pursue more analysis work in Northern New England.

Synthenet: Blogs and beyond

Now going into its eighth year, Synthenet has watched its underlying techology-web development–grow from being a curiosity to an essential tool that many companies need to manage their businesses. The Northboro firm now offers a standard Online Management System, targeted particularly to small and mid-sized businesses, that helps firms maintain their website without extensive in-house IT support.

Company President Rodney Capron notes that his clients are now using their sites for e-learning, contact management, inventory control and other bread-and-butter tasks. They also are paying more attention to tracking and managing website visitors. About 50% of the sites that Synthenet builds also involve some aspect of e-commerce-not just for product sales but for building memberships, registrations, or donations. More companies also are launching blogs as marketing tools, such as one that a picture frame business maintains to serve college bookstores.

This proliferation of web functions helped trigger a 20 percent increase in revenues at Synthenet in 2005, and Capron looks for similar growth in 2006. The company spent $100,000 in 2005 for additional servers, software and firewalls to support its customers, and Capron expects to make more infrastructure investments late in 2000.

Rather than aggressively seek more clients in 2006, the web developer wants to build more long-term relationships with its current base of some 65 customers. "We’ve seen good times and bad, and we are now enjoying a more steady flow of business," says Capron. "The focus now must be on innovation and servicing our customers."

Larry Maloney can be reached atlmaloney@wbjournal.com