Development of the Technology

Northport's China subsidiary originally established an on-line tax payment intranet system that required review and approval from both banking and tax bureau agencies. As a result, the core technology is acceptable to financial institutions and allows for secure accounting and payment processing procedures. This original platform technology known as Tenet, is still utilized by China corporate users.

Looking for additional uses for its technology, Northport noted the dramatic increase in sales of digital cameras and a lack of places to develop the photos. Since the end of 2005, an increase of 30% to 50% for digital printing has been shown in larger cities- in fact, higher than for traditional film printing. In addition, there are now millions of mobile phones with a camera function, and these camera cellular phones are expected to reach a level of 70% in the China market. There are currently over 550 million cell phones in China.

In 2005, using the Tenet platform, the management of Northport Beigang began the funding and development of a photo processing technology, and a trade name of Colorstar was registered with the China State Administration for Industry and Commerce in China as well as a Chinese patent applied for on the technology.

Subsequently, a user-operated, stand alone, digital photo developing and printing network operating system was developed. Controlled through a proprietary network server with terminals and self serve digital photo developing printers, the stand-alone devices provide users with digital print images equivalent to regular photographic pictures.?

Installed Beta test units provided market research in Beijing, Shenyang and Dalian and included sampling from consumers (local citizens, tourists and professionals), imaging shop proprietors (color film processing shops and photo-printing collection agencies), as well as convenience stores, lottery shops and advertising agencies and companies.

Colorstar kiosks have been developed as a “platform?which allows the units a wide range of features and capabilities including bill payment, ticket purchasing, and a host of Internet access features including MP3 downloads

Current Operations

Digital Photo Kiosk Application

Currently kiosk units are being manufactured in Dalian China and the model 4 version has been updated to a fully modular design which provides increased efficiency in photo processing operations and has a lower capital cost.

An initial order of 542 kiosk units from China Netcom has been received for installation into several of their internet cafes and this order will be completed by mid 2009. Based on consumer revenue results, Northport expects additional demand from China Netcom and other Asian clients. The Company estimates that it could have over 5,000 kiosk units installed by 2010 in China alone.

An assembly facility has been established in Richmond, BC, Canada where Colorstar kiosks are being analyzed to determine North American standards acceptance. Once this review has been completed, an additional facility will be established in Seattle, Washington and market introductions begun in North America.

Travel Services Application

In October 2008, Northport acquired a majority interest in Ling Xiao, a Shenyang China based travel service company which has an established client and revenue base. Ling Xiao will utilize a Northport proprietary terminal device, which will increase efficiency, security and revenue potential for Ling Xiao.

Future Applications of the Platform technology

Northport's “platform?technology has application in a number of consumer related areas and kiosk/terminal devices are being designed for provision of a wide range of other features and capabilities including bill payment, ticket purchasing, and a host of Internet access features including MP3 downloads.