January 16, 1995

To Our Colleagues in the Online Communications Community:

As you may be aware, CompuServe and Unisys recently demanded royalties for
use of the GIF imaging format. Unisys contends that it has a patent on the
LZW algorithm that is used in GIF imaging.

After seven years of licensing GIF on a royalty-free basis to the online
community, CompuServe and Unisys announced on December 29 that software
developers would have only two weeks to license their GIF usage or face
patent infringement litigation.

Further, CompuServe also announced that it would license GIF only for use
in products that are used primarily for accessing the CompuServe
information service. This licensing restriction effectively removed GIF
from public use and converted it to a proprietary format.

The actions by CompuServe and Unisys have harmed many companies in the
online communications community, and have severely disrupted TeleGrafix's
previously announced plans to release and begin shipping our long-awaited
RIPterm 2.0 online multimedia software today, January 16.

Ironically, one of the reasons we originally extended our release date of
RIPterm 2.0 was to include GIF support after numerous requests from our
customers.

We have worked hard to reach a compromise with CompuServe.
WE HAVE RECEIVED ABSOLUTELY NO COOPERATION FROM THEM.

Ten days ago, TeleGrafix developed a software solution that would allow the
continued use of the GIF format without infringing on the Unisys algorithm
patent. TeleGrafix offered to provide the source code of our solution to
the computer community free of charge as a public service. Because
CompuServe has a copyright on the GIF format, an issue seperate from the
Unisys patent claim, we have been unable to distribute the software fix
unless CompuServe consents.

All of our messages and phone calls to CompuServe executives, including
President Maury Cox, have gone unanswered. CompuServe executives have told
the press that they are aware of our communications. CompuServe also has
stated that it does not intend to fix the current GIF format, but will
develop an entirely new format for release at an unspecified date in the
future.

TeleGrafix is now removing all support for GIF imaging from RIPterm 2.0
software. This will result in a short delay. We are removing GIF from the
software, online help system, documentation, product literature, and
advertising materials. We then have to re-test the software, rebuild the
master disk and have it duplicated, and republish the documentation and
product literature.

We apologize for the delay. TeleGrafix plans to ship RIPterm 2.0 in
approximately one week, beginning next Monday, January 23, 1995.

Pursuant to California and Federal law, customers who have placed advance
orders for our RIPterm 2.0 software and who do not wish to accept this
brief delay are entitled to cancel their order and receive a complete
refund.

If you have other questions, wish to place an order, or need technical
assistance, please call our new tech support line at (714) 379-2130.

For more information on the GIF controversy, documentation is available on
TeleGrafix's BBS, the Vector Sector, at (714) 379-2133.

We encourage our customers to complain directly to CompuServe and Unisys
about the outrageous conduct they have displayed in suddenly demanding
payment of the GIF Tax and converting GIF to a CompuServe-only proprietary
format.

We thank you for your understanding. And many thanks for the hundreds of
kind letters and messages we have received from those in the online
community who support our efforts to help solve the GIF problem.

Sincerely,

Pat Clawson
President & CEO
TeleGrafix Communications Inc.
16458 Bolsa Chica, Suite 15
Huntington Beach, CA 92649

Phone: (714) 379-2140
Fax: (714) 379-2132
Internet: patclawson@delphi.com

 ============================================================
 From the 'New Product News' Electronic News Service provided
 via AOL (Keyword = New Products) & Delphi (GO BUSINESS PROD)
 ============================================================
 This information was processed from data provided by the 
 company or author mentioned. For additional details, please 
 contact them directly at the address/phone number indicated.
 OmniPage Pro is now used for converting all printed input! 
 ============================================================
 All submissions for this service should be addressed to:
 BAKER ENTERPRISES,  20 Ferro Dr,  Sewell, NJ  08080  U.S.A.
 Email: RBakerPC (AOL/Delphi), rbakerpc@delphi.com (Internet)
 ============================================================
