Lockheed Martin 1996 Annual Report Download - page 32

everal significant accomplish-
ments in 1996 by the
Information & Services Sector
strengthened and expanded Lockheed
Martin's role in its traditional businesses
and positioned the Corporation to take
advantage of opportunities in rapidly
growing commercial information technol-
ogy and federal, state and local govern-
ment services businesses. Our strategy
is to grow fast and profitably in rapidly-
growing markets.
A major achievement in 1996 was
the successful transition of Space Shuttle
processing operations to United Space
Alliance (USA). In an unprecedented step
that marks a new government/contractor
approach to the management of America's
Space Shuttle program, NASA awarded
the Space Flight Operations Contract to
USA, making the joint venture between
Lockheed Martin and The Boeing
Company the single prime contractor
for Space Shuttle operations. The total
contract, valued at approximately $7
billion over six years, consolidates 12
previous contracts under USA and
provides for an additional 16 contracts to
be brought under USA management.
During 1996, employees of Lockheed
Martin Space Operations and its successor,
USA, achieved 100 percent mission
success by safely launching and landing
seven Space Shuttle missions.
In its Commercial Systems business,
Information & Services formed a new
company, Real 3D, to exploit its real-time,
three-dimensional graphics technology.
This technology has been developed over
three decades of experience providing the
military with advanced simulation systems
and is protected by more than 40 patents in
computer image generation.
Real 3D accomplished a key strategic
objective in 1996 when it reached agree-
ment with semiconductor industry leader
Intel Corporation to jointly develop a new
chip that will give desk-top computer
users real-time, three-dimensional color
graphics rich in texture detail that is five
to ten times better than currently available.
The chips are scheduled to go into produc-
tion in 1997. Real 3D will also bring
its real-time 3D graphics technology to
the laptop computer market through an
alliance with Chips & Technologies, Inc.,
a leader in laptop computer graphics. In
another important development, Real 3D
strengthened its ongoing relationship with
Sega Enterprises, a world leader in arcade
video games. Real 3D completed design
and began production of the latest genera-
tion chip set for Sega arcade video games
and, late in the year, received a new
contract from Sega to begin developing
even more advanced technology for the
arcade video game market.
Information & Services expects a
multi-billion-dollar market for 3D
graphics technologies by the end of the
decade. The worldwide production of
3D graphics chips is forecast to grow
to 115 million chips by the year 2000, up
from 7.8 million chips in 1996.
Additionally, Information &
Services continued to expand its role in
the commercial information technology
outsourcing business in 1996 as textile
maker Fieldcrest Cannon selected
Lockheed Martin's Integrated Business
Solutions to operate its extensive informa-
tion networking, E-Mail and desktop
computer operations. As a result of this
10-year outsourcing agreement, Fieldcrest
Cannon will be able to lower its
information technology costs and improve
customer service.
Publicly traded CalComp
Technology, Inc. (NASDAQ:CLCP) was
created in 1996 with the acquisition by
CalComp of Summagraphics Corp.,
Austin, TX, bringing together companies
with complementary technologies
and product offerings in the Computer
Aided Design and graphics arts markets.
CalComp's 1996 operating losses,
combined with the consolidation of
Summagraphics, demanded restructuring
actions late in the year to address cost
and competitiveness issues. In addition,
the acquisition of new ink-jet technology
was announced to enhance CalComp's
position as a leading producer of large-
format printers, plotters, digitizers, cutters
and scanners.
Information & Services