Investigation to Lab Phase Review

1
Investigation to Lab Phase Review

• BST Functional Staff Presentation February 20,
  2003

2
Agenda

• Introduction Bruce Zignego (05)
• Marketing Andy Prater (15)
• RD/Qualification Testing Chuck Samson (40)
• Jon Lewis
• Finance Amber Craver (6.8)
• Manufacturing Rusty Osborn (10)
• Technical Marketing Tai Dang (05)
• Summary and Wrap-up Bruce Zignego (05)

3
I/L Presentation Purpose

• I/L Presentation
• Market Feasability
• RD Feasability
• Program Feasability
• Program Plans Complete
• Lifecycle Deliverables
• IPG Product Lifecycle Photofinishing Lifecycle
  (work in process)
• All documents are via \\vcssaskatoon\groups\photo\
  jetstream\checkpoints\do\Jetstream_IL_02-20-03.ppt
  
• Flags
• Green - On Plan or Finished
• Yellow - Off Plan, but path forward identified
• Red - Off Plan, path forward not identified

4
Definitions

• PfDS MAT1 Rev 0
• Initial implementation of CeWe Market acceptance
  test
• PfDS MAT1 Rev 1
• Exit of CeWe Market Acceptance Test (4 mo from
  start)
• First production revision for PfDS
• PfDS Rev 2
• Final PfDS solution
• PfRE MAT2
• PfRE solution acceptable to MAT2 customer
• Port MAT3
• Portrait solution acceptable to MAT3 customer

5
Scope of I/L

• PfDS MAT1 Rev 0
• PfDS MAT1 Rev 1
• Risks to MAT 1 Rev 0
• Path Forward to MAT1 Rev 1

I/L Scope
Subsystem Level 1 Discussion
PfDS Rev 2

• Backprint
• Texture
• Other Layouts
• New Image Sizes

Preview Upcoming Applications
Program Function Level Discussion
PfRE MAT2

• Reorder System Integration
• Backprint
• Texture?

Port MAT3

• Texture
• Extend Color Map
• Guillotine Cut

6
DI Photofinishing solutions development lifecycle
Generic solution development
DO________I/L____________DP_____VR
Print engine Web-handling Finisher RW XY cutter 3
slit RW Buffer/dancer Media transport Image
Hub PIE SW cabinetry Kiosks Order entry
station Support
Legend
Technology teams road maps
Activities
Checkpoints
Customer commit
Validate
Pilot Rollout
Trial Solution Assessment
Solution definition
Customer tee up
Support
Business modeling
Install pilot
Funnel building
Detailed trial definition
Customize Integrate
Customer solution development
Trial Phase

• customization and qualification
• IT integration and configuration
• Co- marketing
• installation and training
• service and support
• supply chain

Solution definition
Validate
Rollout
Solution Assessment
Support
Install rollout
Customize Integrate
Rollout Phase
7
PfDS CeWe
Print engine Web-handling Finisher RW XY cutter 3
slit RW Buffer/dancer Media transport Image
Hub PIE SW cabinetry Kiosks Order entry
station Texture Backprinting Guillotine
X
X
X
X
X
X
X
X
X
X
X
X
X
X
8
2005 Worldwide Amateur, Professional
Photofinishing Products, Services Revenue to
Photofinishers
Manufacturer Revenue 11.7 B Overall
Growth Rate 11 CAGR (2000-2005)
Alternative
High-end Onsite Retail 2.4 B 36 CAGR
High (gt15)
Low-end Onsite Retail 1.1 B 33 CAGR
Super High-end Onsite Retail 0.5 B 28 CAGR
2010
Revenue Growth Rate (2000-2005)
Mid-range Onsite Retail 4.7 B 7 CAGR
Low (lt15)
Portrait 0.5 B 5 CAGR
Commercial 0.4 B 5 CAGR
Wholesale, Mail Order, Central 2.1 B 4 CAGR
Low (lt2B)
High (gt2B)
Revenue
Source Photofinishing News Sept. 02, Bain, HP
estimates
9
Central lab market for high-speed digital printers
10
HP Indigo Photo c9100 ForecastWholesale Central
Labs
11
(No Transcript)
12
PfDS Solution Workflow
Incoming Sort
Batch Management / Lab Data Management
CD Burning
Fun Product Production
Photo and Index Print Production
13
HP PfDS solution
Jetstream I/L February 20 2003
Digital Order
Scanner
photo web site
Central Operations
Digital Camera
Home
Incoming Sort
Batch Management / Lab Data Management
Envelope orders
Onsite Retail
14
Agfa PfDS solution
Jetstream I/L February 20 2003
AGFANet d-port 3.0 WSF
Digital Order
Scanner
photo web site
AGFANet Print Service
Central Operations
Digital Camera
Home
Onsite Retail Agfa e-box Order
Agfa DigiFilm Splicer
Agfa DigiFilm Order Management PC
Image Data
Batched CD Orders
AGFANet e-box
Incoming Sort
Batch Management / Lab Data Management
Envelope orders
CD Burning
Agfa ImageCube Agfa Image Cube Select
Agfa DigiFilm CD
Packaging
Customer orders
Order Pickup
Agfa d-lab.3
Onsite Retail
Agfa net-lab.12
15
PfDS competitive landscape
Jetstream I/L February 20 2003
Central Lab Digital Printing

Photo print production HP Indigo Photo C9100 Agfa d-lab.3 Agfa net-lab.12
Print speed 10K pph (4x6) 1,100 pph (4x6) 1,100 pph (4x6)
Digital print technology LEP dry ink RGB laser on Agx RGB laser on AgX
Media size 316 mm minimum 89 maximum 210 mm minimum 89 mm maximum 305 mm
Maximum print size 12x18 8x10 12x18
Print size within batch mixed orders fixed paper width fixed paper width
Output 12 roll to multiformat finisher cut prints to sorter cut prints to sorter
Fun product production HP Indigo Press 3000 With optional Pixtasy software none
16
PfDS competitive landscape (contd)
Digital Order Solutions

Online print service hpphoto.com HP InstantShare AGFANet Print Service
Retail digital print kiosk ePoint Agfa e-box
Retail CD burning kiosk ePoint Agfa ImageCube for DigiFilm
17
PfDS competitive landscape (contd)
Other Central Lab Solution Components

CD order input and splicing none Agfa Digifilm Splicer and Order Management PC
Internet order management HP Net-Prints Agfa d-port 3.0 WSF
CD burning HP Memories Disk none
18
HP SWOTPrints from Digital Source (PfDS)

• Strengths
• CPP and TCO of HP solution
• High-speed XY cutting solution
• Indigo 3000 for photo-related products
• HP Memories Disc
• HP is a known industry player in both digital and
  IT
• HP is able to amortize its investments over a
  broader range of businesses

• Weaknesses
• Low PfDS print volume may make it difficult for
  customers to justify purchase of HP system
• HP entering central lab equipment market as an
  unproven supplier
• Funding constraint limits our window of
  opportunity
• HP solution only works with HP consumables no
  freedom of choice

• Opportunities
• Print volumes for PfDS reprints/enlargements
  probably enough for customers to justify
  purchase of HP system
• HP Services for solution customization and
  integration
• Huge stake in the ground CeWe as our first
  reference customer

• Threats
• Agfa d-ws story

19
Jetstream I/L February 20 2003
HP value proposition for PfDS
HP Photofinishing Solutions for PfDS Helping
photofinishers increase revenue and profit
through central fulfillment of digital source
prints

• Delivery of new, differentiated products and
  services
• Better prints photo quality with increased
  durability through lamination
• True prints aspect ratio preserved with no
  loss of image data through cropping
• HP Memories Disk CD
• Retailer-branded online fulfillment
• Photo-related products such as greeting cards,
  photo album pages, calendars, etc.

• Lower total cost of ownership (TCO)
• No AgX paper processors required
• Smaller footprint for a given throughput
• Streamlined workflow
• Reduced supplies cost
• Lower cost of HP Electro Ink and HP paper
• No AgX chemicals required eliminate handling
  costs and environmental-friendly
• Print layout optimized to minimize paper waste
• Reduced labor cost
• Efficiently produce more mixed orders per
  employee per hour
• Fewer skilled positions required
• Reduced training requirements

20
Jetstream I/L February 20 2003
MAT1 waste analysis
Cewe Oldenburg Digital Fulfillment
hp indigo photo c9100 fulfillment
8x10
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
5x7
5x7
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
4x5.33
27 waste
6 waste
21
Pricing model MAT1 and beyond
Market Trial 1 (CeWe) Commercial Shipments
Consumables (per 4x6 print) 1.8 euro cents (1-5 systems) 1.65 euro cents (6 systems) 2.7 US cents (1-10 systems) 2.5 US cents (11-25 systems) 2.4 US cents (25 systems)
Consumables (per square foot) 10.8 euro cents (1-5 systems) 9.9 euro cents (6 systems) 16.2 US cents (1-10 systems) 15 US cents (11-25 systems) 14.1 US cents (25 systems)
HP Indigo Photo 9100 Family Euro 500,000 (1-4 systems) Euro 450,000 (5 systems) US 500,000
XY Cutter Euro 200,000 US 200,000
What customers are saying District Photo Were
looking for 1.5 cents per print. Everythings
driven by ROI. Fotolabo We would like
long-term pricing out 2 to 4 years
22
Jetstream I/L February 20 2003
PfDS funnel beyond MAT1
Customer Business Status
Klick Retail outlets throughout UK with central fulfillment out of four labs. 14-15 million rolls per year. Starting in-store kiosk trial with HP in March 2003. Fulfilled with existing Fuji printers. If trial is successful in terms of demand, will proceed with beta trial of c9100 system.
Fotolabo 100 mail order. 450M prints per year (1/3 of mail order market in Europe). Currently processing 2 online orders, growing at 200 per year. 13 of revenue from reprints and enlargements. 7 of revenue from CD burning. Goal 50 of revenue from digital products by 2004. Meetings at Photokina in Oct 2002 and onsite in Nov 2002. Extremely high interest. Just completed IQ evaluation of c9100. Asking very detailed questions about operation of press, image enhancements, consumables.
Photocolour Kreuzlingen 100 mail order. 100M prints per year. 15 of analog customers want image CD. Online orders currently 5 and growing. Meetings at Photokina in Oct 2002 and onsite in Nov 2002. High interest. Currently evaluating Indigo IQ. Looking to implement full digital workflow by Easter 2004. Interested in potential beta test end of 2003. Willing to sit down and discuss workflow in detail.
Fuji Switzerland 4-5 digital orders today, growing rapidly. Image CD with 10 of orders. Meeting at Photokina in Oct 2002. Have expressed interest in a potential beta test. (We tend to test one of everything.)
District Photo Mail order central lab for 1000 independent retailers in northeast. Agreement with Kodak/Qualex to fulfill overnight orders in five states. Very focused on ROI. Looking for two-year breakeven. Meeting at Photokina in Oct 2002. Have expressed extreme willingness to bring us in to understand workflows and to build TCO model. Have done IQ evaluation of both Phogenix and Indigo.
Shutterfly Online order fulfillment. Currently running Indigo 3000 for photo-related products. Had been considering Gretag for growing digital print capacity. Further discussion at PMA.
23
Marketing risks update
Marketing Risks _at_ DO Marketing Risks _at_ DO Status _at_ I/L
Competitive reaction of lower AgX pricing to HPs introduction of photofinishing solutions We think we understand the raw costs of AgX. However, we dont understand the magnitude of the defensive posture of Fuji and Kodak. Agfa is really the competitor to be watched. Were confident our CPP, combined with a broader TCO value proposition, is solid for PfDS or RE. Will need to assess more closely for PfCNF where we will likely be competing more closely on cost per print.
Value proposition proven Resolve by I/L. Needs to be tested with more customers. Competitive solutions could beat us (timing, functionality, etc.) Feedback from major customers has been extremely positive both during and after Photokina. Value proposition appears to be strong, but we will attempt to quantify through TCO models. Main concern at this point is with Agfa d-ws system and its components. Agfa is known, were unproven.
Digital adoption occurs slower than we assume Market in transition. Our assumptions on what will win might be wrong. Feedback from major customers indicates strong growth in digital source orders. gt200 growth year-over-year
Understand market and design requirement for portrait lab market. Resolve by I/L. Not in scope of program but is financially very favorable. Fairly strong understanding of key requirements following in-depth visits with portrait customers in U.S. Further validation at PMA.
Ability to meet customer requirement at market trial (throughput, reliability, IQ, etc.) Need more information on customer requirements and customer workflow. RD spent one week at CeWe in Nov 2002. Key requirements and workflow well understood. SRD published and approved by CeWe in Jan 2003. System reliability is the biggest concern at this point.
24
Additional PfDS marketing risks
XY cutter pricing 200K for XY cutter not yet tested with key PfDS and RE customers. Spitzke negotiations still in progress. Need to evaluate price sensitivity.
XY cutter sourcing XY cutter is a control point in the PfDS/RE solution. Spitzke negotiations regarding IP critical to our mid- to long-term strategy. Will need to evaluate situation following current round of negotiations.
Lack of redundancy c9100 can represent a single-point of failure within the customers workflow. Some customers have indicated that they would rather have two printers running half speed at half cost.
Weight of HP paper Some customers have expressed concern that our paper may be too light or too thin. Need to assess relative to other photo paper.
Drift in image quality within a system as well as between systems We will work with CeWe to do some acceptance testing. Long term, we will need to establish a set of objective tests.
25
jetstreamdevelopment strategy
Where Indigo Indigo DPT Conquip Spitzke DPT
DPT DPT DPT DPT
Strategy Reuse Invent Invent/Leverage Outsource
Outsource Invent/Leverage Invent/Leverage Inv
ent Invent/Leverage Purchase
What hp Indigo photo c9100 Photo
Electroinks Finisher Rewinder XY Cutter Photo
Imaging Engine Image Hub System
Throughput Workflow Media transports
DPT Ownership Chuck Samson Andy Singer Sean
Underwood Rich Brinkly Dan Arquilevich Andy
Singer Andy Singer Andy Singer Jon Lewis Sean
Underwood
26
RD HW

• Current hw status
• PfDS system footprint
• PfDS risks paths forward
• finisher components
• buffer/dancer
• structure external design
• lamination
• edge trim
• electronics
• hp indigo c9100
• rewinder
• XYC
• media transport
• Backup slides

27
HW status

• Buffer/Dancer
• Assembled. Off-line testing started.
• Finisher
• Held review w/Indigo design team.
• 80 parts in-house. Build starts 20-Feb
• Rewinder
• Specification review held with Conquip. Design
  initiated per plan.
• XYC
• Prototype complete and in transit to PMA
• c9100
• Schedule review held in Rehovot 17-Feb
• Carts
• Not yet sourced. Plan is to buy commercially
  available equipment.

28
PfDS finisher rewinder id
29
PfDS finisher components
30
Buffer/Dancer (finisher)

• Risks Path Forward to rev. 0 (MAT1)
• What if pneumatics are too jerky for lamination
  process
• Confirm operation through integration testing.
  If pneumatic approach fails, then well switch to
  a gravity based design.
• What if buffer failed to provide proper tension
  for lamination process
• Confirm tension through integration testing. If
  pneumatic approach fails, then well add a web
  tension system.
• Path to rev. 1
• Improve accessibility, reduce DM cost, and
  address open regulatory issues

31
Structure/external design (finisher)

• Risks Path Forward for rev. 0 (MAT1)
• No significant issues identified
• Path to rev. 1
• PE access door modified to simplify the alignment
  process
• Increase waste capacity
• Improve accessibility, reduce DM cost, and
  address open regulatory issues

32
Lamination (finisher)

• Risks Path Forward to rev. 0 (MAT1)
• What if the vacuum box fix does not resolve
  polyethylene build up issue
• Parts in-house. Bulk of testing will have to be
  after PMA, which is later than hoped. In
  parallel we will assess contamination removal
  subsystems (8-14k DM)
• What if inclusions in laminate are deemed
  unacceptable
• Working with current supplier and assessing
  laminate quality of another supplier, GBC.
• Path to rev. 1
• Increase laminate roll capacity to 3000m rolls
• Reduce DM cost and address open regulatory issues

33
Edge trim (finisher)

• Risks Path Forward to rev. 0 (MAT1)
• Sensor that controls web steering within the
  finisher has not been selected
• Testing a third sensor, whose packaging is a
  concern
• Investigating a fourth sensor through another
  vendor. This sensor also requires packaging
  modifications
• Investigating the use of narrower laminate
• We could get lucky and web tracking w/in the
  finisher may not be an issue
• Knife engagement does not meet safety
  requirements
• New information. Investigating possible
  solutions.
• Path to rev. 1
• Improve chopping system reliability,
  supportability, and DM improved

34
Electronics (finisher)

• Risks Path Forward to rev. 0 (MAT1)
• Finisher interface to the Image Hub has not yet
  been defined
• Make completion of this design a priority and
  allow time by off loading assembly tasks to
  ETWs.
• Eye-mark sensor DM too high sensor has not been
  selected
• Continue to work with Spitzke sensor package
  due mid-Mar. Reviewing feasibility of potential
  contingency designs.
• EE bandwidth is stretched thin and took a hit
  when ETW left
• Have hired a replacement EE ETW (2 mo contract).
• Plan to have a EE FTE on board by 1-May.
• Have approval for firing of EE Tech. ETW (2 mo.
  contract)
• Path to rev. 1
• Support DM cost reduction and regulatory
  compliance

35
hp indigo c9100

• Risks Path Forward to rev. 0 (MAT1)
• The ?E for black ink is gt 2.5 and the impact to
  the system ?E has not been quantified
• Assess impact to system ?E . Possible outcome
  may require black ink with ?E lt 2.5
• Condensation fix BCS potentially too late to
  start trial
• Ship without fixes and perform upgrades at Cewe
• Assessment of the PE contamination fix later than
  hoped
• Expend resources testing contaminate removal
  systems
• Running out of time to solve PE web tracking
• Provide quick feedback through monitoring
  equipment
• Path to rev. 1
• No issues identified

36
hp indigo c9100

• Changes required for rev. 0 (MAT1)
• Web tracking fixed
• Auto Color Adjust tuning
• x2100 to xw8000
• Throughput improvements
• Dynamic repeat length
• CS, condensation fix, and BCS
• Substrate waste due to calibration minimized
• Eye-marks on service pages
• Frame width increase
• PE contamination
• ILD operating out of temperature range fixed
• MMI upgrade to include Buffer-Finisher-Rewinder
• c9100 name plate
• Changes required for rev. 1
• MMI upgrade to include individual status of
  Buffer-Finisher-Rewinder
• Side door access for easier buffer-to-PE alignment

37
Rewinder

• Risks Path Forward to rev. 0 (MAT1)
• What if the rewinder does not meet requirements
• Face-to-face review of requirements w/Conquip
• Acceptance test scheduled for late march.
• Worst case, we do a complete redesign of the
  rewinder
• Path to rev. 1
• No known changes

38
XYC

• Risks Path Forward to rev. 0 (MAT1)
• No significant issues identified
• Path to rev. 1
• What if the output rolls require side walls
• Spitzke to provide estimate early-March

39
PMA XYC
40
PMA XYC
41
PMA XYC
42
PMA XYC
43
Media transports

• Risks Path Forward to rev. 0 (MAT1)
• No known issues
• In the process of sourcing potential vendors
• Path to rev. 1
• No known changes

44
RD Software

• Current software status
• Photo Imaging Engine
• Image Hub
• Computer Rack
• System Performance
• Image Quality
• Workflow
• Layout
• Error Recovery

45
Software Status

• MAT1 architecture instantiated PfDF jobs being
  parsed and printed.
• On-plan to be code complete on schedule
• System performance continuing effort to prove
  feasibility, hp indigo pushing on some new ideas
• Ink reduced color maps delivering good image
  quality
• Global Contrast Enhancement prototyped into
  pipeline initial results are promising from IQ
  improvements
• Color calibration/press consistency AML
  identified as viable solution drawback are
  added waste and non-ideal workflow integration.
• Layout algorithm is handling smallest to
  largest excellent progress
• Architecture scalability for performance have
  verified that we can use 3 PIEs.

46
Image Pipeline for MAT1Sharpening

• Selectively sharpens edges and fine detail.
• Avoids sharpening noise.
• Brings out feature detail by using a local area
  edge filter.

47
Image Pipeline for MAT1Smoothing

• Selectively smoothes noise due to
• Poor capture devices.
• Compression artifacts.
• Avoids smoothing edges or fine detail.

48
Image Pipeline for MAT1Global Contrast
Enhancement

• Brings Depth to faded or foggy images
• Fixes under/over exposure.
• Improves contrast.
• Does not alter hues.

49
Photo Imaging Engine (PIE)

• Risks Path Forward to rev. 0 (MAT1)
• Late arrival of QA resources and lack of SW
  integration plan is concern for SW verification.
  Trying very hard at the engineering level to get
  it right. Test harnesses around most components.
• Global Contrast Enhancement performance/throughp
  ut/IQ requirements.
• Initial revision integrated into pipeline,
  analysis to begin post-PMA
• Path to rev. 1
• Work proactively with CeWe to understand if IQ
  requirements are being met through periodic
  reviews before and during trial.Plenty of
  support from customer, simply need to engage.

50
Image Hub

• Risks Path Forward to rev. 0 (MAT1)
• Late arrival of QA resources and lack of SW
  integration
• plan is concern for SW verification. Trying
  very hard at the engineering level to get it
  right. Test harnesses around most components.
• Path to rev. 1
• Eliminate hot folder interface to BMS, provide
  a more direct PfDF client-server connection.
• Make a smarter layout algorithm based on
  customer feedback.

51
Computer Rack

• Risks Path Forward to rev. 0 (MAT1)
• Unfamiliar with full requirement set of a rack
• Ordered current planned configuration - will
  configure system and test post-PMA
• Path to rev. 1
• No significant issues identified

52
System Performance

• Risks Path Forward to rev. 0 (MAT1)
• Performance havent fully proven yet, cant do
  until we get a new PC from Indigo.
• HP Indigo DPT convinced that current x2100
  (current Indigo PE Controller Computer) cannot
  deliver current speed/throughput specifications
  PCI bandwidth limited.
• Intent is to change to x4000 class system with 2x
  PCI, Windows XP and VCORN3 imaging system.
• HP Indigo committing to deliver for first market
  trial. DPT to get schedule from HP Indigo. This
  will require further risk assessment.
• HP Indigo has proven performance using the new
  PC configuration.Contingency is to use x2100 at
  lower performance to start trial, upgrade during
  the trial.
• Path to rev. 1
• No significant issues identified

53
Image Quality

• Risks Path Forward to rev. 0 (MAT1)
• Image quality variance throughout day. This will
  require a cost per page vs. image quality
  tradeoff.
• Indepth cost per page modeling to understand
  processes to correct varianceContinue
  development to lower image quality variance. ACA
  is not adequate for photo requirements request
  fix in 6.5 software AML meets requirements for
  color consistency, waste cost high Color map
  changes to help offset where possible Compile
  operator knowledge base to transfer to
  customer Compare against competition sellable
  prints between calibrations
• Which UI knobs are required/defined their
  effect of adjustment are notWill start dialogue
  with CeWe engineers post-PMA to gain better
  understanding of adjustments.
• Lack of Jetstream resources focused on image
  qualitySuccessfully engaged members of Hudsons
  team to assist with color map generation and
  image enhancement evaluation.Pull Jason back
  into the mix once layout algorithm settles down.
• Path to rev. 1
• No significant issues identified

54
Workflow

• Risks Path Forward to rev. 0 (MAT1)
• Quantity of waste pages (calibration, substrate
  change/resupply, end of batch flush, landing
  zones) negative impact to cost per page.
  Quantify the amount of waste, identify high
  contributors, develop solutions to
  eliminate/reduce.Work with hp indigo to minimize
  length/frequency of calibration jobs.Model
  substrate change/resupply end of batch flush
  and determine any quick fixes in either HW/SW.
• Path to rev. 1
• No significant issues identified

55
Layout

• Risks Path Forward to rev. 0 (MAT1)
• Several conflicting requirements (e.g. print
  order is smallest to largest) for layout may
  minimize the overall effectiveness of reducing
  waste.Doing our best to nail as many of these
  scenarios as possible while also reducing waste.
  Have good verification procedures/plans
  identified.
• Path to rev. 1
• Enhance layout algorithm to handle more print
  sizes and continue to push on waste reduction
  vector.

56
Error Recovery

• Risks Path Forward to rev. 0 (MAT1)
• Use cases not fully flushed out to understand
  impact to both HW and SW system cause of this
  is various time constraints.Elevate priority of
  this task, assess overall impact, address as much
  as possible with SW.
• Error Recovery, not clear how automated this
  should be.Taking a critical look at the entire
  system to determine best path forward.
• Path to rev. 1
• Identify potential changes once use cases are
  fully flushed out and address as appropriate.

57
PfRE Software Development

• Reorder station
• Establish engineering relationship with reorder
  station manufacturer
• Research features/capabilities
• Understand what customer has (if any)
• Purchase reorder station(?)
• Optimize image processing for scanned film path
  (from reorder)
• Layout algorithms for additional/unique print
  sizes
• Backprinting
• Requires new interfaces with image hub
• Integration into customer BMS/LDM

58
PfPort Software Development Tasks

• Optimize image processing for scanned film
  dependent upon scanner vendor and customer
  workflow
• Optimize for larger (resolution and size) digital
  source files.
• Integration into lab data management system (DP2)
• Color management/image processing (areas to
  improve)
• Highlights/shadows
• Skin tones
• Sharpening(?)
• Layout management should be handled by customer,
  will receive units as single file (JPG/TIFF)
• Backprinting

59
Qualification Testing

• Regulatory
• SWQA
• HWQA
• Reliability

60
Qualification Testing
Accomplishments

• Completed Jetstream Quality Plan
• SWQA on board, 1st pass test plans complete
• DTS system in place
• Indigo Presses safety updates completed,
  certified for compliance
• and ready to ship, authorized by 3rd party test
  consultant

61
Reliability

• Reliability baseline understood with WS100 alpha
  testing
• Initial photo reliability tests completed but
  Jetstream design immaturity hindered data
  accuracy.
• Color consistency tests give baseline of some
  consumables (blanket, PIP)
• Ink alpha testing in April will give us better
  photo consumables data and color consistency
  data.
• Qualification testing resources now focusing on
  reliability testing.

62
Qualification Testing Issues

• EMC Decision whether to declare or test EMC
  compliance is pending if we test, schedule is
  tight based on ability to respond to failures
• Iterate design as needed
• Safety Released design before reviewed by
  safety.
• Iterate design as needed
• SWQA Test plan execution behind schedule
• Resources in-place, plans are being developed
• Ramp ETWs for tests
• 60 uptime not proven given our photo
  requirements
• Continue to gain knowledge with development tests
• (alpha, ink usage, etc. . . ) to understand
  reliability issues

63
Financial Goals

• Achieve 30 blended gross margin on
• Hardware
• Consumables
• Service Support
• By FY06
• Investigate Jetstreams ability to contribute to
  overall photofinishing profitability goals
• Break-even blended gross margin by FY04
• 3 net profit by FY05
• Work in progress to assess (not quite there with
  current plans)

64
Revenue by application (FY04 thru FY08)
65
Indigo Photofinishing Financials

• FY06 Goal 30 blended gm Actual 27

66
Indigo Financial Sensitivities Base NPV 95M
67
Variable Hardware Margin
68
Consumables Margin
69
Indigo CPP Sensitivity Detail
70
Finance - Risks Issues

• Actual CPP
• Media waste
• Ink density
• Consumables life
• Consumables cost reductions over time
• Variable hardware margin
• Finisher MOH jumped dramatically from DO
• Finisher DM climbing (100k?)
• Refinement of SS financials
• Connect rate and duration of SS contracts
• Distribution, Installation Warranty costs
• Insufficient FY04/FY05 volumes to cover
  infrastructure costs
• FY04 Goal BE gm Actual -1.3M
• FY05 Goal 3 net profit Actual -16

71
Solution Deliverables/Logistics

• Who Supplies Specifics
• c9100 Press HP Indigo (Israel)
• OEM Subsystems
• XY Cutter (Spitzke) (Germany)
• Rewinder (Conquip) (USA)
• Media Transfer Cart (Off the shelf USA)

72
Solution Deliverables/Logistics (cont.)

• Finisher, Buffer/Dancer, Computer Rack
• Initial Production HP DPT
• We will utilize a build, test, install, upgrade.
• Production after stabilization Will move to a
  CM managed by IPMO.
• CM location currently TBD. Most probably
  Singapore.
• Computers
• HP Generic

73
Solution Deliverables/Logistics (cont.)

• Solution Capacity Plan
• Current planned capacity 2 per month.
• Based solely on current forecast.
• Key Factors at HP and OEMs Influencing Capacity
• Inventory
• Factory Floor Space
• Trained Assembly Personnel
• Material Warehouse Space

74
Solution Delivery Plan

• Solution Lead Time
• Target is to have unit ready for install at
  customer locations 3 months after receipt of
  customer order.
• 5 6 weeks required for shipping.
• Material bought to forecast.
• Press built to forecast.
• Preassembly of common subassemblies where
  possible.
• Forecasting/Planning
• DPT Procurement resource to provide forecasting
  and planning.

75
Solution Delivery Plan (cont.)

• Supply Chain and Integration Plan
• Mat 1 (CeWe)
• All Subsystems minus XY Cutter shipped to DPT.
• Solution minus XY Cutter integrated at DPT.
• XY Cutter shipped from Spitzke to CeWe.
• DPT Integrated Solution shipped from DPT to CeWe.
• Complete Solution including XY Cutter installed
  and integrated at CeWe.
• Solution acceptance at CeWe.

76
Solution Delivery Plan (cont.)

• Mat 1 Until Stabilization
• All Subsystems shipped to DPT.
• All Solutions Integrated at DPT.
• Integrated Solution shipped from DPT to
  Customer.
• Complete Solution Installed at Customer.
• Solution acceptance at Customer.

77
Solution Delivery Plan (cont.)

• Post Stabilization
• All Subsystems shipped to Customer.
• Solutions integrated at Customer.
• Solution acceptance at Customer.

78
Solution Delivery Plan (Cont.)

• Consumables Plan
• Press Consumables (Ink, Imaging Oil, etc.)
• Supplied via the current HP Indigo Supply chain.
• Paper/Laminate
• Contracts currently under development which will
  establish a reliable delivery path .

79
Solution Delivery Plan (cont.)

• Service and Support Parts
• Service Parts for both HP and OEM designed
  subsystems identified by DPT Tech Marketing.
• Part packaging designed by DPT Procurement or
  leveraged from HP Indigo.
• Parts where to shipment location currently
  under investigation.
• CeWe direct for Mat1
• TBD for shipments after Mat1
• Parts shipped from
• DPT for DPT supplied subsystems.
• OEM for OEM supplied subsystems.
• HP Indigo for HP Indigo press parts.

80
Quality

• DPT Supplied Subsystems Specifics (Finisher,
  Buffer/Dancer, Computer Rack).
• Subsystems will be spec able, testable
  shippable.
• Verify FCDs and CPPPs 100.

81
Quality (cont.)

• PEPs (Product Enabling Processes) Performance
  Verification tests will be developed by DPT.

82
Quality (cont.)

• Press and Computer
• Current HP quality programs will be accepted as
  is. No explicit verification by DPT will be
  done.
• OEM Supplied Subsystems
• Specific quality plans will be developed for each
  OEM supplied subsystem. Plan to include
  verification criteria as well as data retention
  mandates.

83
Jetstream I/L 20 February 2003
Engineering Responsibility (ER) Model

• ER Model
• Mat 1 through Stabilization
• ER DPT RD
• After Stabilization
• ER Hardware DPT PSCD
• ER Software DPT RD
• PR (Process Responsibility) IPMO

84
Jetstream I/L 20 February 2003
Risks and Issues

• Spitzke Relationship
• Impacts to the XY Cutter (Price IP)
• Path forward Continuing negotiation and BATNA
  development
• Rising DM Costs
• Path Forward Update cost roll-ups and work with
  RD to identify key pareto items for future
  work.
• CPPPs
• Currently undefined.
• Path forward Work with RD to insure CPPPs
  adequately defined.
• Forecast Risk
• Effect on material exposure and solution
  lead-time.
• Path Forward Procurement currently hiring a
  planner/forecaster. This individual will work
  with DPT Marketing to insure forecast as accurate
  as possible.
• Mat1 Service and Support Part Requirements
• Path Forward Procurement currently working with
  Tech Marketing to define parts and their
  corresponding lead-times.

85
Technical Marketing

• Documentation for Customer and Field
• Highly leverage from WS4000 for the press
• OEM components documentation from suppliers by
  contract
• TM Learning Products resource on board early
  March for others
• Installation
• RD, TM Engineers, and Field Engineer will do
  installation
• Training for Customer and Field
• Assuming customer operators attend Indigo
  training as base
• Field Engineer trains in Vancouver from
  March-July
• TM HW SW Support Engineers assist in all
  training
• RD Operator provides help until customer up to
  speed
• Parts Strategy and Setup
• Leveraging WS4000 parts process for press
• Will determine and setup parts for other
  components as designs finalize
• Need to determine CeWes requirements

86
Technical Marketing - Risks

• Hiring of WS4000 experienced field engineer
• Validation of service and support financial
  assumptions
• CeWe Parts Requirements post-trial

87
Cost per Page The Story

• There are different levels of costs
• Consumables CPP
• This will be a cost per page with no waste and no
  layout costs. This will have no labor, etc.
  costs. This cost will be used as a competitive
  CPP vs. AgX.
• Loaded CPP
• This will be our true cost per page including
  layout, waste generation, color calibration, etc.
  We will use this information to work with the
  customer to optimize their business (which
  layouts are efficient, which image sizes cost the
  most, etc.)
• TCO
• This will be the total cost of ownership for a
  customer. It will include Big CPP but also have
  labor, workflow, etc. It will be the total cost
  a business will see if they use our system. It
  will be used as a comparison with AgX TCO.

88
CPP Methodology

• Use DPS CPP as the basis
• Develop Photo based assumptions
• Verify assumptions through tests
• Recalculate cost per page
• Adjust model as appropriate
• Take action to meet goals
• Iterate

89
CPP Next Steps

• Develop Excel model which approximates the cost
  per page. It will be a function of the
  following Image content, color map, layout,
  waste, yield. Iterate on model as empirical
  information increases.
• Continue tests to develop understanding of
  consumable usage (Ink alpha test, color
  consistency test, uptime test).
• Update PDO staff monthly on status.

90
TCO Next Steps

• Weekly meetings between finance and marketing
• Develop TCO model.
• Perform due diligence with key customers over
  next two months.
• Update PDO staff monthly on status.

91
Waste Generators

• Blanket aging
• PIP replacement
• BID replacement
• Waste removal (trash bin)
• Batch header/trailer identification (non-rev gen
  but not waste?) xy cutter too
• Non-scheduled maintenance waste
• Replace Bobbin
• Replace Scorotron
• Web break
• Jam
• Next Batch Available waste
• No next batch available - waste
• Error-recovery

• Initial paper load start to finish length paper
  waste
• Daily start up procedure
• Web tracking alignment set up
• Laminate Load
• Splice lam/paper
• Splice lam
• Splice paper
• Trim margins
• Landing zone generation w/o texture
• Landing zone generation w/texture
• Color calibration
• Blanket replacement (frequency)

• Things that happen to generate waste (at any
  point in the operation) (amount of waste,
  frequency, time reqd, people, skill level)

92
Accomplishments

• Sales front end training completed for central
  lab photofinishing business.
• Completed successful completion of Photokina
  trade show demonstrated the technology and built
  a funnel with potential customers
• Aligned consumable pricing philosophy between DPT
  DPS.
• Verbal agreement with CeWe, the largest
  independent central lab in the world, for the 1st
  market trial.
• XY cutter requirements defined, agreed to with
  Spitzke, eye-mark feasibility proven and demo
  ready for PMA.
• RW supplier chosen (Conquip) and development
  started.
• Added resources Hem Mather ME, Mark Carlton
  SWQA , Paul Meade EE ETW,
• Jill Barber Professional Assistant, Avish
  Gavriel HW tech marketing, Loren Chapple
• Workflow Architect
• Have path forward on 10K/hr system performance
• Basic understanding of color consistency
• Completed design of layout engine for mixed order
  format
• Completed SRD for PfDS with CeWe, understand CeWe
  workflow requirements.
• Initial HW design completed (except skins,
  shielding, waste bin and eye-mark sensor mount).
• Communicated and gained alignment on
  photofinishing requirements for the Indigo
  platform.
• All required I/L plans complete
• Both Presses in Vancouver certified for safety
  compliance, ok to sell.
• All required I/L plans complete
• Both presses in Vancouver certified for safety
  compliance, ok to sell.

93
Central lab development status
6/20/03 Ship PfDS Solution to CeWe
5/24/04 MAT3
3/3/2003 PMA
2/20/03 I/L Checkpoint
7/15/03 MAT1
12/1/03 VR PfDS
11/24/03 MAT2
2003
2004
2
3
4
5
6
7
8
9
10
11
12
1
2
3
4
5
3
5
I/L checkpoint (February 20, 2003) - Workflow
integration - Sustained 10K performance -
Reliability uptime system - Web feed issues -
Value proposition proven PMA (March 3, 2003) -
X-Y cutting - Kiosk to Central Lab PfDS MAT1
(July 15, 2003) - Assume 4 month duration -
Integration to customer environment - Prove the
business model
VR PfDS (December 1, 2003) PfRE MAT2 (November
24, 2003) - Scan film I/F - Reorder system -
Backprint Port MAT3 (May 24, 2004) - Portrait
texture - Guillotine cut - Portrait color
map - Portrait lab data management system I/F
94
Top Issues / Path Forward

• Sensor that controls web steering within the
  finisher has not been selected.
• Test and investigate sensors. Investigate use
  of narrower
• laminate.
• Cost per page understanding is not complete.
• Continue to improve our understanding of cpp and
  tco. Develop process to tradeoff cost vs. IQ.
• Reliability of photo solution not fully
  understood and we have not characterized exactly
  what the customer needs.
• Continue test characterization and reliability
  modeling.
• XY cutter negotiations. Concern with cost of xy
  cutter and eye mark sensor components over life
  of the program.
• Implement negotiation strategy defined by
  procurement and investigate technology
  alternatives.
• Some Indigo deliverables not in synch with our
  solution timing needs.
• Continue to monitor and track deliverables vs.
  schedule.

95
PfRE Issues

• Supplier for reorder system
• Gretag status??
• Spitzke negotiations and the impact??
• Need assumptions on features so we can predict
  form factors required for finisher.
• We need to understand if we can pull texture into
  the PfRE MAT2.

96
Portrait Issues

• Potential need to integrate with packaging
  systems. Barcoding may be a requirement.
• Current paper weight may be an issue.

97
Program Management

• Jon Lewis will take over program management of
  Jetstream.

98
(No Transcript)
99
Appendices
Jetstream DO 26 August 2002
100
Jetstream Program
Introduction

• Objective
• Design necessary solutions that allow us to
  validate our business model in targeted customer
  segments and position us to grow the business
• Necessary solutions PfDS, PfRE, Port PfCNF
• Validate our business model (validate that we can
  have profitable business once we enter the
  market)
• Financial measures will center around revenue
  growth, actual gross margins and operating profit
  achieved compared to assumptions
• Solution delivery measures will include ability
  to provide installation, service support,
  consumables
• replenishment, etc.
• Customer segments Independent Wholesale Lab

101
Jetstream Program

• Goals
• Financials 30 blended gross margin HW,
  consumables service and support by end of
  FY06
• Timing July 2003 First Market Trial
• November 2003 VR PfDS Rev 1
• Feature Set Meet Central Lab customer requirement
• IQ equivalent to AgX
• Cost per print
• Workflow Integration
• Throughput 10K/hr peak
• Reliability
• Manufacturing Cost

102
Jetstream Priorities

• Constrain resources
• Optimize scope
• Accept schedule

103
Project priorities (in order)

• ITEM Date
• PMA 3/3/03
• MAT1 7/15/03
• PfDS MRD TCO 5/1/03
• PfRE MRD TCO 5/1/03
• Klick trial (order entry) 4/14/03
• PfRE trial 11/24/03
• Fotolabo 3 yr. proposal 6/15/03
• Klick trial readiness ?
• Port MRD TCO 4/15/03
• Port trial 5/24/04
• City Lab investigation 8/1/03
• Jericho arch. dvlpmnt ongoing
• PfCNF MRD TCO ?
• PfCNF trial 8/04?
• 2nd source media ?

104
DP Objectives

• Achieve full functionality of all subsystems
  (demonstrate form fit, function)
• Complete detailed plans for all aspects of the
  program
• Confidence in total solution through early
  testing and analysis
• Develop the supply chain and plan for production

105
VR Objectives

• Validate all aspects of product solution meet the
  PLC POR and delivers the desired total customer
  experience
• Confirm that mfg., dist. and support processes
  are in place to meet the product level goals

106
Jetstream Schedule (major dates)

• PfRE MAT2 customer chosen 4/15/03
• I/L PfRE 6/1/03
• DP PfDS 6/19/03
• Ship PfDS solution to CeWe 6/20/03
• MAT1 PfDS trial begins at CeWe 7/15/03
• I/L Port 9/1/03
• DP PfRE 10/28/03
• VR PfDS 11/1/03
• PfRE MAT2 trial start 11/24/03
• VR PfRE 3/1/04
• DP Port 4/28/04
• Port MAT3 trial start 5/24/04
• VR Port 9/1/04

107
Jetstream Schedule (MAT1)

• SW basic print functionality complete 1/31/03
• Finisher 1 assembly begin 2/18/03
• Finisher stand alone testing 3/4-3/18/03
• Indigo press fixes BCS, CS leak, ILD 3/17/03
• Finisher Integration testing w/press 3/18-4/18/0
  3
• Indigo press fixes Polyethylene buildup 3/24/03
• SW advanced print functionality comp. 3/28/03
• RW arrive Vancouver 4/4/03
• SW integration w/finisher (5K) 4/15/03
• SW integration w/finisher (10K) 4/24/03
• RW ready to ship to MAT1 4/24/03
• XY cutter ready for MAT1 5/19/03
• Indigo press fixes Web guide alignment 6/1/03
• Solution integration and test complete 6/20 /03
• Ship PfDS solution to CeWe 6/20/03
• Installation at CeWe 7/8/03
• PfDS trial begins at CeWe 7/15/03

108
Jetstream Schedule (MAT PfRE)assumes higher
priority than Port

• PfRE
• MRD completed 5/1
• TCO completed 5//1
• BP Ink eval strikethrough 2/28
• Mech intgn backprinter 5/30
• Finisher I/F to IH 4/24
• Intgn I mark sensors w/finisher 4/24
• Programming finisher 5/30
• RE Press arrives in Vancouver 6/29
• Finisher HW system test 6/30
• Reorder workflow (1 mo) 6/1-7/1
• IE Path, scan/IH (2 mo.) 7/1-9/1
• Layout (1-2 mo.) 7/1-9/1
• SW I/F to Backprinter (2 mo.) 7/1-9/1
• LDM Integration (2 mo) 7/1-9/1
• Solution and Intgn test (2 mo) 9/1 11/1
• Solution ready for MAT 11/1
• MAT PfRE installation complete 11/24

109
Jetstream Schedule (MAT Port)

• Port
• MRD complete 4/15
• TCO complete 4/15
• Customer selected ?
• Portrait press arrives in Vancouver ?
• Optimize IH for portrait input (2
  mo.) 12/1-2/1/04
• LDM Integration (2 mo.) 1/1/04-3/1/04
• Portrait layout algorithms (1 mo) 1/1//04-2/1/04
• Portrait specific color mgmt (3
  mo.) 1/1/04-3/1/04
• SW backprinter I/F (2 mo.) 1/1/04-3/1/04
• Demo Texture (1 mo.) PMA
• Texture rollers in house (6-7wk) 3/15
• Sidewall design (2 wk) 2/15
• Add buffer system bypass sytem (1 mo.) 3/15
• Fab texture parts (1 mo.) 4/15
• Assemble texture subsystem (2 wk) 5/1
• Texture Integration and test (3 mo) 7/15
• Backprinter developed (see RE dates) 6/30
• Guillotine subsystem (3 mo) 5/1-9/1

110
Jetstream core components

• Core
• Indigo Photo C9100
• Unwinder
• Engine
• Finisher
• Back Printing
• Lamination
• Texture
• Slit
• Guillotine cut
• Pkg Interface
• Consumables
• Photo ink
• Media
• Laminate
• Other
• Photo Imaging Engine (PIE)
• Image Hub (including workflow integration)
• Rewinder

• Core Plus
• High speed scanning
• Digital Source Provider
• X-Y Cutter
• Pkg Equipment (modified to accept Imark)
• Reorder system
• Outside Jetstream
• Computer Input Terminal (CIT)
• Fun Products
• CD burning
• Long Term Storage and archive

111
Central Lab program update applications and
solutions elements
Prints from CNF
Reprints from CNF
packaging station
film
Prints from CNF
Prints from Digital Source
film
Gretag
EIS
High Speed Film Scanners
Reorder station
Photofinisher Lab Data Management System
Prints from Digital Source
Digital files from retailer
Cut sheets
Digital files from web site
Prints from Digital Source
Spitzke
CD
XY cutter
Red -- components provided by 3rd party companies
or photofinisher Blue -- components provided by hp
Cut mixed order prints
112
Components of Jetstreams Value Proposition

• Competitive cost per copy
• Consumables
• Total cost per copy our workflow advantage
• No paper developing
• Matte or gloss on the fly
• Unique Solutions for the customer
• Flexibility
• Variety of print formats we support
• Tailoring to the customers workflow
• Variety of solution configurations we support
• Variety of output formats we support
• Environmental
• No AgX chemical requirements
• Durability
• Equivalent AgX light fastness
• Equivalent AgX archivability
• Improved handle ability (laminate
• Comparable AgX IQ
• Improved color consistency?

113
Program Assumptions
114
Program Assumptions (cont.)
115
Program Assumptions (cont.)
116
Phase 2 - Investigation Phase

• 5. DEMONSTRATE FEASIBILITY
• 5.1. Demonstrate technical feasibility of the
  platform, product solution and/or processes. (We
  can design/manufacture it.)  Product
  architecture, hw/sw/fw/product platform
  architecture, early prototypes, risk
  assessment
• 5.2. Demonstrate the market feasibility of the
  platform/product solution. (We can sell it.)
• Commit to goals for ease of use, street
  price, sales forecast, introduction window
• Confirm target customer, competitiveness
• 5.3. Demonstrate the financial feasibility of
  the program. (We can afford it.)
• Commit to goals for product cost, investment
  cost
• 6. SATISFY CUSTOMER
• 6.1 Finalize platform/product solution benefits
  and feature set. (We know exactly what it is.)
•   Commit to goals for feature set,
  differentiation, customization
• 6.2. Plan the customer impact (TCE) of the
  platform/product solution.
• Commit to goals for warranty, AFR, loyalty,
  service support cost
•  OOBE/Set-up, ease of use, compatibility,
  functionality, HW reliability, call rate, call
  length

117
Phase 2 - Investigation Phase

• 7. INITIAL EXECUTION PLANS
• 7.1. Preliminary plans are developed in all
  areas of the organization.
• Marketing, supply chain, engineering,
  customer satisfaction, learning products,
  localization, human factors
•  Where-built decision, development strategy,
  schedule, budget, staffing plan, ERS, SRD,
  SW-ERS
• Understand development environment, define
  process for managing proposed changes to PLC
  POR
• 8. BUSINESS SUPPORT
• 8.1 Confirm support for PLC POR from IPG, the
  business unit, the PGO, and CBO/BCO.
• PLC POR Product Data Sheet, Program
  Objectives Statement, ERS, SRD, SW-ERS,
  financial goals
• HP cross-divisional deliverables and
  commitments are clearly specified and
  supported by key-management.
• 8.2. Confirm external partnership expectations
  and satisfactory progress relative to goals.
• Contract issues, roles responsibilities,
  oem/odm/cm strategies, Canon DC exit criteria
• 8.3. Manage all areas of program risk.
•  Understand and realistically communicate all
  areas of program risk, evaluate and develop
  contingency plans and triggers obtain management
  support

118
Phase 2 - Investigation Phase (cont.)

• Deliverables
• Country Localization Plan
• Design Documentation (IRS, etc.)
• ERS
• Financial Goals
• Information Engineering Product Data Sheet
• Learning Products Plan
• Product Data Sheet
• Product Plan
• Program Objective Statement
• Program Schedule
• Software ERS
• Software Project Test Plan
• Software Release to Test Plan
• Software Requirements Document (SRD)
• Test/Quality Plans

• Milestones
• Where-built Decision
• Exit Criteria
• Feasibility is demonstrated (technical, market,
  schedule, risk.)
• Key program plans are ratified and placed under
  change control.
• Needs of leverage reuse partners are
  understood.
• The written PLC POR exists between the PG Program
  Team and the business partners.
• Staffing resources for future phases are
  identified.
• End of phase
• I/L (Investigation) Checkpoint
• Business decision at Checkpoint

119
Phase 3 Development Phase

• DEVELOP AND IMPLEMENT SOLUTION
• 9.1 Complete sufficient design and
  implementation activities to create early
• versions that