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Old-school segment producing for nextScan

Like many high-tech firms, nextScan plans new offerings for new markets.

Unlike many high-tech firms, the Meridian-based company (www.nextscan.com) thrives on working with old technology: microfilm. The manufacturing that nextScan does is not a good candidate for outsourcing overseas, partly because it’s specialized and not mass produced, company officials said.

Software and hardware that nextScan develops and manufactures in Meridian – where the company recently moved and expanded – enables entities to “digitize” and enhance documents originally on microfilm, said Ernesto Pinal, vice president of marketing and international business. The idea is to make documents accessible and searchable by any digital means, and easier to read.

The company’s software also supports paper-to-digital scanning, and in the next year nextScan plans to expand into software that enables the final output to be in a format accessible by document management platform Microsoft Sharepoint, nextScan President and CEO Kurt Breish said. The offering would aim to help users streamline workflow.

The “paper” market is still large, but the amount of film to be converted to digital is greater than all of the paper yet to be converted, he said.

Starting about 70 years ago, institutions and businesses used microfilm to cut down on document storage space while helping to preserve paper documents, Breish said.

“There’s a lot of film out there still,” he said. “We have a single project with billions of (filmed) pages.”

Some film-to-digital conversions are mandated and others are done by choice as advantages are identified, Breish said. The market, in which nextScan is among a handful of competitors, has expanded as system costs have dropped.

The trend is toward faster scanning and higher-quality images, Pinal said. One of nextScan’s scanners can scan more than 1,000 images per minute from a roll of microfilm.

Image quality has been the focus in the last two years, Breish said.

“Every sin for capturing paper on film has been committed,” he said. “Now we have to fix it.”

Paper deterioration notwithstanding, some original documents were of marginal quality from the moment they were created due to the technology available, Pinal said.

He said nextScan has improved its products to increase customers’ productivity and reduce their cost of operation. “System throughput” improvements enable the customer to more efficiently go through the process of scanning, image enhancement, quality control and output.

Revenue is roughly equally divided among commercial and government customers, and bureaus that provide conversion services, Breish said. Government has been the strongest segment recently, and the commercial segment has been busy as businesses seek efficiency gains.

Pinal said revenue is about 47 percent domestic and 53 percent international, with South America the single largest growth market.

Privately owned nextScan last fall moved to a Meridian building at 690 S. Industry Way, from smaller quarters in Eagle. The 7,000-square-foot Meridian office includes expansion space that nextScan has built out for eventual additions to its staff, which now numbers 17.

Pinal said nextScan added a staff position in the past year and has not lost a position since its inception. The company is technology-driven, pays an average salary of $58,000, produces a value-added product that is not mass-produced, and generates patents, he said.

“We don’t just assemble stuff. We develop, manufacture and market our solutions,” he said.

Breish, who started nextScan in 2002, said nextScan saw its “best ever” first quarter – normally a slow time of year. That was followed by a very slow April-May period, which typically sees good demand, and a good June as the service bureau segment improved.

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