Quincy firm pins future on shipment-tracking device

Mark Micheli, Boston Business Journal
June 20, 2003

When Hasbro executive Barry O’Brien needed to check on a recent shipment of toys, he went to his computer and logged on to a web site that pinpointed the location of the shipment from the day it left Hong Kong.

What’s more, if someone tried to tamper with that shipment, he rested assured he would be notified immediately because of a high-tech satellite tracking device, developed by a Quincy company, that was affixed to the containers.

"Security is always important. Where we buy from now, it’s very secure," says O’Brien, Hasbro’s director of global trade and customs. "But you never know what’s going to happen tomorrow."

Pawtucket, R.I. based Hasbro Inc. is one of four companies that participated in a pilot program, financed by the U.S. government, that tested the tracking device developed by 1 year-old NaviTag Technologies.

The product, which is the size of a hardcover novel, attaches to shipping containers and users can program it to alert them by e-mail when the container reaches a certain destination or if someone tries to tamper with the container.

Since the terrorists attacks of Sept. 11, 2001, more companies and the U.S government are concerned about port security and the integrity of the international shipping chain. Shipping industry veteran and Navitag CEO Bob Magown believes he has a product that can protect shipments from terrorists and at the same time make a profit for his fledgling company.

NaviTag received an $875,000 grant from the federal government earlier this year to prove the concept for its product. And with help from Hasbro Inc., Hewlett-Packard Co., Bose Corp., and Jungbunzlauer Inc., the company’s pilot program has been a success, Magown says.

He says the next step is to raise financing to develop cost-effective prototypes the company can test in the fall in order to start selling the product next year. He noted that his two-person company out-sourced the development of the original prototype, but he hopes to be able to hire employees soon for the next stage in the development process.
"We need to close on funding," Magown says. "We’re talking to local venture capital groups and angel investors. And we’ve been talking to some strategic investors as well." He added that the company is always open to other investors who may be interested.
He declined to say how much money the company is looking to raise.

NaviTag was one of several companies to receive federal grant money to conduct a proof-of-concept test for port security products following the terrorists attacks. Magown says that although similar devices are being tested, most of those use radio-frequency identification, or RFID, technology, similar to the security tags put on retail items in department stores. He claims the drawback to those devices is that they require a system of electronic readers be installed worldwide.

"No one else does it quite like this," Magown says. He adds that the market for these devices is bound to grow as the U.S. Customs Office tightens security and as companies look for ways to expedite shipments.

Whether the federal government should require security tracking devices on cargo coming into the United States is being debated today, according to Bob Bouchard, a program manager at the U.S. Maritime Administration in Washington D.C., which oversaw the first round of port security grants.

"And the big debate today is not only security but the cost of that security and who will share in those costs," Bouchard says.

Magown said his company is hoping to make a cost-effective, reusable product that can sell for $400 per unit, with a monthly $30 access fee. He said he believes there will be a market for the product at that price, particularly with companies that ship cargo prone to theft, hazardous materials or products coming from an area of the world considered high risk for terrorism.

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Quincy firm pins future on shipment-tracking device