Seeking strength in numbers, IT firms form network. (Media & Technology).

How does a local information technology company compete with national firms who are able to service customers in locations from Los Angeles to Boston?

CEO Phil Mogavero at Woodland Hills-based information technology firm, Data Systems Worldwide is hoping to solve the problem by helping to form a national network of local IT companies.

The network, which is just getting off the ground, would connect about 30 independent companies, which could then make referrals to others in the network for a fee-sharing arrangement.

"It's giving us a big company capability that we didn't have a year ago," Mogavero said. "Our goal is to establish an alliance so tight that we can deliver services in the same way we can in Southern California."

Called 1NService, the network is organized so that a combined 400 IT specialists each services specific sections of the country.

The group of 30 participating companies got together after networking at trade shows and other industry events.

"We all got together in Texas and we talked about what we would offer to be successful and we agreed that we were one organization and not a bunch of different companies," Mogavero said.

Thomas Van Overbeek, CEO of Shoreline Communications Inc. of Sunnyvale, Calif., said the organization will be key to its growth.

"INService provides a unique opportunity for us to build a quality distribution channel," he said.

Through the new partnership, Mogavero said his company is able to take advantage of opportunities that otherwise would not be possible.

"If a company has other offices, even out of our area, we can still serve them," he said.

Vivid Entertainment Signs Shoe Deal

Adult film studio Vivid Entertainment Group of Van Nuys has signed a deal with Pony Inc. to promote the shoe brand in a national billboard campaign.

In a Feb. 24 announcement, Vivid co-chairman Steve Hirsch said the deal will bring added attention to his company's brand will doing the same for the athletic shoe manufacturer.

Vivid contract performers, or so-called Vivid girls, Jenna Jameson, Sunrise Adams and Mercedez will be featured in the ads wearing skimpy outfits along with Pony-brand athletic shoes.

One black-and-white billboard has already appeared along Sunset Boulevard in Hollywood, Vivid said.

Pony's ad campaign designer Come Chantrel said the effort is part of a long advertising tradition of using pinup girls to sell products. He said the effort is in keeping with Pony's sometimes unorthodox media campaigns.

Almgren Steps Down From Capstone

Ake Almgren, Capstone Turbine Corp. founder, president and CEO stepped down from his posts Feb. 27 after the company reported the latest in a long string of losses.

In December, Almgren announced he would be retiring and leave Capstone. Almgren retired from his job as president and CEO as well as member of the company's board of directors.

Emily Liggett, the company's interim chief operating officer, took over as interim CEO and president, the company said.

On the same day as Almgren's announcement, the company reported another loss for its latest quarter, ending Dec. 31. Capstone lost $20.7 million or 26 cents per share loss on $3.6 million in revenue compared to the same period in 2001, when it posted a $14.6 million loss or 19 cents per share loss on $10.1 million in revenue.

Capstone has struggled to find a niche in the marketplace with its turbine-powered generators costing $40,000 to $60,000.

Analysts say the problem lies with the wide availability of less expensive gasoline powered generators sold by General Electric and Ingersoil Rand Corp., among other factors.

DTS in China

Digital Theater Systems Inc., a maker of digital movie theater audio systems based in Agoura Hills, has opened an office in Guangzhou, China.

Jon Kirchner, DTS CEO, said the new office would serve the growing Chinese market where it will offer marketing and technical support for customers while serving as a liaison with customs officials.

The office is the fourth DTS office to open overseas in the last three years. The other offices are located in Twyford, England; Bangor, Northern Ireland; and Tokyo.

The Chinese office will be led by Henry Hu, general manager, who will oversee a staff of six people administering sales, marketing and finance activities.

Semtech Increases Buyback Program

Semiconductor maker, Semtech Corp. has agreed to increase its ongoing stock buyback program by $75 million.

The Camarillo-based company said the buyback program will now reach $275 million as part of the company's effort to prop up its stock value. To date, the company has acquired $232.5 million of its stock, which includes $53.5 million of its convertible subordinated debentures.

A debenture is an interest bearing bond issued against the credit of a company or corporation.

The company last week reported an $8.1 million profit on $44.5 million in sales for the quarter ending Jan. 26. For the same period last year, the company reported $8.7 million in net income on $46.4 million in total sales. Earnings per diluted share were $0.11 for both periods.

The company's stock price was hovering around $12 to 13 mark last week, well below its 52 week high of $39.72 and above its 52-week low of $8.72.

Staff Reporter Carlos Martinez may be reached at [phone] or by e-mail at [e-mail].