Good afternoon, and thank you for participating in today's conference call. Now I will turn the call over to Bruce Davis, Chairman and CEO of Digimarc. Mr. Davis, please proceed.

Thank you. Good afternoon. Welcome to our conference call. Charles Beck, our CFO, is with me. On the call today, we'll review and discuss our financial results for 2013 and the 2014 outlook, talk about significant business developments and market conditions, and provide an update on execution of strategy. This webcast will be archived in the Investor Relations section of our website. Please note that during the call, we'll be making certain forward-looking statements, including those recognition matters, results of operations, investments, initiatives and growth strategies. These statements are subject to many assumptions, risks, uncertainties and changes in circumstances. Any assumptions we share about future performance represent a point-in-time estimate. Actual results may vary materially from those expressed or implied by such statements. We expressly disclaim any obligation to revise or update any assumptions, projections or other forward-looking statements to reflect events or circumstances that may arise after the date of this conference call. For more information about risk factors that may cause actual results to differ from expectations, please see the company’s filings with the SEC, including our latest Form 10-K. Charles will begin by commenting on our 2013 financial results and 2014 outlook. I'll then discuss market conditions and execution strategy. Charles?

Thanks, Bruce. And good afternoon, everyone. As discussed on prior quarterly calls, we expected 2013 operating results to be lower than 2012, due to lower revenues and increased investments in our business. Our actual results are in line with those expectations. Revenue decreased by 21%, from $44.4 million in 2012 to $35 million in 2013. Revenue was lower due to $8 million of past due royalties paid by Verance in January 2012 and $5.8 million lower license revenue from Intellectual Ventures as the quarterly minimum license fee payment ended in May 2013. These decreases were partially offset by a full year of revenue contribution from our Guardian for e-books business and higher revenues from the central banks. Gross margin was 77% for the year, 8 points lower than prior year, reflecting the change in revenue mix I noted a moment ago. Operating expenses increased 25% over 2012 due to substantial investments in our growth initiatives, including the development and marketing of Digimarc Discover, the Digimarc Barcode, and our Intuitive Computing Platform, as well as continuing to develop and prepare for licensing of our second wave patent portfolio. We've realize an income tax benefit for the year of $1.8 million. Our effective tax rate for 2013 was higher than our statutory tax rate due to income tax of federal R&D tax credits for 2012 and 2013 tax years that were extended in January 2013. At the bottom line, we incurred a net loss for the year of $500,000 or $0.10 per diluted share versus net income of $8.3 million or $1.12 per diluted share in 2012. Cash flow from operations was $3.5 million during the year. We invested $1.7 million in our IT infrastructure and facilities and $1.1 million in patent assets during the year. The balance sheet remains in excellent…

Thanks, Charles. The year got off -- started with a bang at the National Retail Federation Show where we demonstrated the game-changing performance of our Digimarc Barcode by being the world record for checkout of 75 seconds for 50 items by an astounding 27 seconds. We demonstrated the Digimarc Barcode not only as a significant cost savings vehicle for retailers, but also as a key element to the comprehensive mobile-optimized Shopper's Journey that we have developed. Most of the top retailers in the world stopped by to learn about the Discover platform. We had engaging conversations with many of them, and already have had numerous follow-up discussions. Planning is underway with more than one such retailer for detailed testing and potential implementation of the Digimarc Barcode and other elements of the Discover platform. Our focus is turning naturally to delivery. Now that we have provided the provocative demonstration of our capabilities, it's time to close sales and deliver. Our team did an outstanding job of preparation for the launch, and we'll apply that same conscientious effort to delivering our first customers. In updating our strategic plan for 2014, we are working out sophisticated model to estimate the labor cost savings that we would expect to deliver the retailers by increasing the speed of checkout. The model was intended to better inform our pricing, resource allocations and understanding of the potential value of our business. Our preliminary findings indicate a very large market opportunity. According to our latest Annual Report released by the U.S Commerce Department in 2013, total retail sales in 2011 were $4.7 trillion, including food, service and automotive. The global market is probably around $15 trillion. The initial focus of our model was on America's largest general merchandise and grocery retailers who are sometimes referred to as hypermarkets.…

[Operator Instructions] And your first question comes from the line of Bill Gibson.

Hi, Bruce. What catches my attention is the patent filings for virtual wallet and mobile payments, and you talked about increasing request. How do you feel about any technical hurdles from here? Is it just blocking and tackling that you think you can overcome them, or is there a timeline there?

No and no. The mobile payments marketplace is still in its infancy. It's not been very successful life to-date until the Starbucks initiative. And so Starbucks Chairman reported that -- and CEO reported in the last quarter that a substantial portion of their sales were now done from mobile devices using custom barcodes. And so that's the first time that mobile payments have kicked in and been successful. That has -- that lack of success has caused a great deal of controversy and tumultuous activity in the space. And so there are a number of different models that are being promoted and tested, and that needs to get resolved and settled down for us to participate and be winner. What we're providing is a relatively small piece of the overall puzzle. It's the user interface and the ideal here is that, as retail moves to imaging, our consumers could have a very comfortable, familiar presentation of the card that they're accustomed to presenting from the trusted brand they are accustomed to relying upon to pay for the transaction. And so that's what we want to license. So we want to license a software enablement of the communications protocol that's based on presenting your card to the point-of-sale imager in a way that will be well accepted by consumers. And we think that addresses a number of challenges that have not been adequately addressed thus far in the market. But my guess is that it will take a while to sort out. I don't anticipate this being a material contributor to our business in 2014, and I can't make any of assurance about it ever contributing, because it's really just at the R&D stage. What he wanted to note was that we let prospective customers know about this work and they all get really excited. But we don't quite know what that means yet.

It seems like there is a trend that's coming. And then just one little follow-up. You mentioned hiring some IP experts to help market second wave patents. Is there any way that help IV in marketing the first wave, or do you get involved in that, speed up their licensing?

We do routinely help them. And since the resolution of the arbitration, our relationship has improved considerably. In terms of the working relationships, everyone is quite comfortable now and we're doing a lot of mutual consultation about how to improve the licensing of the patents that have been exclusively licensed to IV.

[Operator Instructions] There are currently no further phone questions.

All right. Thanks very much, everyone.

I would now like to turn the call back over to Bruce Davis. Sir, please proceed.

Well, I will conclude the call then, and look forward to catching with you again next quarter or sometime in the interim. Thanks very much, everyone, for your support.