Skip to main content

DemoGraFX leaves the lab

After toiling 13 years in his Santa Monica, Calif., lab and receiving dozens of patents for image-compression innovations, veteran engineer Gary Demos is going commercial. A new management team and $10 million in funding have given new life to his company, DemoGraFX, which will work to put the technology in prototype consumer products, such as set-top boxes.

Demos, who has been awarded grant money by the National Security Agency and the National Institute of Standards and Technology for his work, has been joined by ex-General Instrument/Dolby executive Robert Rast, former Microsoft DTV architect Tom McMahon, and former Motorola Marketing Vice President Paul Hardy. They'll move into new offices in Marina del Rey next month.

Rast is president/CEO; McMahon, chief architect; Hardy, marketing/sales vice president. Demos is handling the R&D efforts as chief technology officer.

This well-traveled team is equipped with $10 million in funding from Baker Capital in New York, with the goal of commercializing Demos' compression technology across a wide range of applications from digital cinema to set-top boxes, DVD storage and wireless receiving devices. Demo-GraFX will license the technology to other hardware and chip makers and create reference designs for others to build as well.

The technology will be marketed to the cable and DBS industries, where better compression means improved image quality, more channels and efficient use of satellite transponder space. Terrestrial over-the-air DTV broadcasters could benefit because compression enables new channels with varying bit rates to be placed in the data portion of a station's digital ATSC signal.

"The next generation of broadband services will feature high-quality digital video, whether for entertainment, conferencing, enterprise or educational applications," says Dr. Henry G. Baker, a partner at Baker Capital. "We believe [DemoGraFX's] layered digital compression technology will play a vital role."

McMahon, who spent four years at Microsoft, envisions a home-theater system containing a PC board with DemoGraFX decoding capable of rendering high-resolution images that will "take Windows Media [streaming software] to the next level. The folks at Microsoft are too focused on the PC to understand what we're talking about."

Rast has been brought in to run the business side, where he will try to license Demos' patented technology to companies whose products rely on high-quality compression. That is what he did during two years at Dolby Labs as vice president of business development for digital cinema (he also currently serves as vice chairman of the ASMPTE technology Committee on Digital Cinema).

"My challenge is to take the company from an R&D mode into a commercial enterprise," Rast explains. "We need to focus on specific applications, and it's going to take us a few years to get there.

"While Gary has been a big supporter of progressive video acquisition," he adds, referring to Demos' work with a 720p camera developed by Philips and Polaroid, "the primary technology of the company is compression. He has come up with what we call 'visually perfect' or 'visually lossless' quality at competitive rates. That's what we're bringing to market."

Using MPEG compression to display a high-quality signal on a large movie screen requires roughly 40 Mb/s. Demos' compression work has produced superior quality at 20 Mb/s, according to Demos. Also, whereas the 4.7-Mb/s bit rate typically used for DVD is too slow for HDTV display quality, Demos is showing 1,080-line resolution at that bit rate.

McMahon points out that the Hollywood community is very interested in high-quality compression for mastering feature-film content in a digital form. This, he says, includes resolutions much higher than HDTV's 1,080 lines (perhaps 2,000 lines). The studios plan to simultaneously distribute this content from a single master to movie screens and the Internet and for home release on DVD.

To this end, DemoGraFX got its first public scrutiny last Tuesday when it participated in a digital-cinema demonstration at the USC Entertainment Technology Center in Hollywood, Calif. At the event sponsored by the MPEG Digital Cinema Committee, several companies (including Qualcom and Sarnoff Corp.) showed off their non-MPEG compressed digital images enlarged on a big screen at the college's Pacific Theater.

Demos says he has been working with compression in the hope of producing better quality than that currently achieved with the MPEG-2 distribution standard. There are a lot of deficiencies in the MPEG standard, he says, which result in bad compression. He did contribute to the MPEG committee's work, which was finalized in November 1994, but has continued to improve his own algorithms.

It might be difficult to get consumer electronics manufacturers to adopt a technology that doesn't have MPEG approval, but Demos isn't daunted by the prospect. "MPEG is a weird combination of politics, technology and random happenstance," he says. "You can make custom chip technology with little companies today, so it's not a requirement anymore that one go through a big, bulky, high-inertia standards process."

Demos is also working with image preprocessing to improve the signal before compression.

DemoGraFX's strategy, according to Rast, is to enhance existing MPEG-2 decoder designs—which might be in a set-top box, video editing system or PC—and make such products display images better.