Morgan Keegan is out with another negative datapoint about OmniVision (NASDAQ:OVTI), saying the co has a pair of private upcoming competitors for its Wavefront coding technology.
Firm has learned of two private companies that have software-based auto focus product offerings similar to OmniVision's wavefront coding technology. Wavefront coding uses software to focus digital images instead of mechanical components to adjust the camera lens. This is a very attractive application for camera phones, which do not do well with moving parts. OmniVision was originally going to introduce a product including the technology this month, but the company has not been satisfied with its performance and no new timetable has been given.
The two private companies firm has identified who have similar technologies are DxO Labs and Dblur Technologies. DxO Labs is a French company that was spun off from Vision IQ in late 2002 and has roughly 60 employees. It has embedded imaging products similar to wavefront coding, as well as two lines of PC-based software for image enhancement and image quality measurement. Management has confirmed that its embedded imaging products are generating revenues. DxO Labs is backed by a variety of European and Japanese venture capitalist firms.
The other private company is Dblur Technologies, which is based in Israel and was established in 2000. It has a Software Lens product that provides the same auto focus functionality as wavefront coding and the company offers a variety of related services. Backers include Sequoia Capital, TemproPark Fund and Landa Ventures.
Notablecalls: OmniVision hasn't been too successful with its Wavefront technology so far. Upcoming competition isn't very surprising, but will not help the sentiment, either.