SMALL BUSINESS : Inventor Hopes to Pocket Music and Profits

Sydney Urshan wants to be a rock star and carry his records in his wallet. The North Hollywood inventor’s dream is riding on a tiny “compact card” that he said will hold up to 40 albums worth of music and make him a millionaire.

Urshan, a trained musician and former TV repairman, has spent the past 18 months building and refining the Urshan Research Broadcast System, which he said will enable consumers to record hours of digital-quality music onto a piece of plastic the size of a credit card.

Urshan said that if the invention works as planned, it will transmit perfect stereo signals over the air, in a way similar to cellular phones, so people can send and receive music around the world almost instantly--a fax machine for sound instead of print. Urshan has only one prototype of the machine and says he’s filed patents to protect his invention.

But like most small-time inventors, what Urshan needs to complete his research is money, and he’s still waiting for someone to match his faith with funding so he can go into production.

Industry analyst Jeffrey Logsdon of Seidler Amdec Securities Inc. in Los Angeles said new technologies, such as Urshan’s invention, cannot survive without the sponsorship of “a major player” in the business.

Shelly Weiss, Urshan’s fast-talking partner whose job is to find investors, says they need about $4 million to get the invention off the drawing board and into production.

At a recent demonstration for executives at EMI Music Publishers, the largest music publishing firm in the United States, Urshan transmitted the stereo signals across the room in one of the firm’s Hollywood offices.

“This would put us two steps ahead of our competitors,” said Michael McCarty, EMI’s West Coast director of creative affairs. “We need to get music to offices around the world. Now it takes at least one day.”

McCarty said after the demonstration that he is convinced the prototype works at least over a short distance. Corporate officers at Thorn/EMI, the firm’s parent company, would have to make the final decision on whether to fund the venture, he said.

Before he can send a signal more than 50 feet, Urshan said he will need to build a transmitter headquarters and construct a network of signal boosters, much like those already being used by cellular phone companies. In addition, the broadcast system must rent space on satellites to broadcast signals around the globe. All of that, of course, costs money that Urshan still doesn’t have.

Urshan’s machine converts music signals from a record, cassette or compact disc into a digital signal that can be encoded on one of his “compact cards.” His machines--which will be designed to receive, record and transmit the digital music signals--would also allow for consumers at home to dial a phone number and “buy” the latest album releases directly from record companies by having them transmitted over the air.

In addition, Weiss envisions a worldwide system of record outlets, similar to the banking industry’s automated teller machines, where consumers insert their compact cards to buy the latest releases. Music industry and entertainment companies will be able to instantly send music to offices anywhere, without having to wait for cassettes to arrive by mail, he said.

Music industry executives agree the idea is a good one. Despite the electronics revolution, music producers at even the toniest record labels can do no better than hold a phone up to a loudspeaker if they want to play a new song for a colleague across town.

Still, most echo the sentiments of Deidre O’Hara, vice president of creative affairs for EMI Music Publishers: “I want to see it work first.”

Jac Holzman, chief technologist for entertainment giant Time Warner Inc., has not seen Urshan’s invention but said the technology exists to do what the inventor claims.

The biggest drawback, Holzman said, may be that Urshan’s invention is ahead of its time. The music industry “is still trying to digest CDs,” he said. “They’re talking about a whole new technology when the last dollar hasn’t been wrung out of CDs.”

That sort of skepticism doesn’t worry either Weiss or Urshan. Weiss, who owns a music publishing firm in North Hollywood, says, “This is the next fax machine.”

So far, he and Weiss have spent about $7,500 on the venture. They figure they can sell 3,000 of the machines for about $3,000 each and make an $8-million profit for themselves and investors.

Urshan’s only electronics training came at his father’s TV repair shop in the San Fernando Valley. Urshan said he learned all he needed to know about electronics at Economy TV, where he started working at age 13 in 1970. For the next 11 years, he fixed TVs and home stereos, eventually opening his own repair shop.

He sold his business in 1981 after a serious car accident left him with limited use of his hands. After spending more than a year recovering from his injuries, Urshan began pursuing a career as a rock musician, a move that proved to be the catalyst for Urshan’s invention.

Urshan said he got the idea on Jan. 31, 1989, the day he turned 32. A friend called and wanted to hear a new song recorded by Urshan’s band.

“I turned up the stereo real loud and held the phone up to the speaker,” Urshan said. “Then the neighbors started banging on the walls. It was 2 in the morning.”

While the neighbors were drifting back to sleep, Urshan was thinking. He reasoned that there was probably a way to send music over the phone lines, the same way facsimile machines transmit words and pictures.

Six months of work yielded a device that could transmit analog music signals over telephone lines. Unfortunately, no one in the music business was much interested in an analog device, which produced much lower-quality sound compared to digital signals. Compact discs produce digital-quality sound.

By fall, Urshan had returned to the North Hollywood garage where he had built a makeshift laboratory and started again. But he could not find a way to transmit the high-quality digital signals over copper phone lines.

So Urshan decided to send the signals over the air. Several of his first attempts failed. But using components from local surplus and retail electronics stores, Urshan by Christmas had built a transmitter and a receiver that finally worked. “I kept the plans in my head,” he said.

The idea of using a “compact card” came to Urshan while he was using a copying machine at UCLA, he said. The cards are optically encoded, in the same way as compact discs, to charge users of the copying machine.

In addition to EMI, Urshan and Weiss have conducted demonstrations at A&M; Records in Hollywood, where there has been considerable interest but still no cash. Weiss said he is not worried, because even firms that turn down the investment can still be good customers once the machine is built.

“Everybody is going to want to buy these and give them to their record producers and musicians as gifts,” Weiss predicted.

The last garage inventors to make it big putting together existing technology in a novel fashion were Steve Wozniak and Steven Jobs, founders of Apple Computer, said Henry Samueli, an electrical engineering professor at UCLA.

But unlike Jobs, Urshan said he is not much interested in creating an electronics empire. He said he would rather use the profits from the invention to build a home recording studio where he can create a hit record.

“I love electronics, but I’d rather be a recording artist,” Urshan said.

In the meantime, Urshan and Weiss are answering their telephones on the first ring, hoping for a corporate investment. “We’re just waiting,” Weiss said.