U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB


(Mark One)

XXX      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
---      ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002.

___      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934 FOR THE TRANSITION PERIOD FROM __________ TO __________.


                         Commission File Number 0-27106
                                                -------


                                  Viseon, Inc.

        (Exact name of small business issuer as specified in its charter)


              Nevada                                             41-1767211
              ------                                             ----------
  (State or other jurisdiction                                  (IRS Employer
Of incorporation or organization)                            Identification No.)

545 E. John Carpenter Freeway, Suite 1430, Irving, Texas           75062
---------------------------------------------------------          -----
        (Address of principal executive offices)                 (Zip Code)

                                 (214)-424-5700
                                 --------------
                           (Issuer's Telephone Number)


Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was Required to file such report), and (2) has been
subject to such filing requirements for the past 90 days. YES _X_ NO __

The Company had 14,849,898 shares of Common Stock, $ 0.01 par value per share,
outstanding As of November 12, 2002.

Transitional Small Business Disclosure Format (Check one): Yes ___ No _X_


                                  Viseon, Inc.


<PAGE>


                                      INDEX


                                                                            Page
                                                                            ----

PART I.  FINANCIAL INFORMATION

         Item 1.  Financial Statements

                  Consolidated Balance Sheets - September 30, 2002
                  (unaudited) And June 30, 2002 ............................. 3

                  Consolidated Statements of Operations (unaudited) -
                  Three Months ended September 30, 2002 and 2001............. 4

                  Consolidated Statements of Cash Flows (unaudited) -
                  Three Months ended September 30, 2002 and 2001. ........... 5

                  Notes to Consolidated Financial Statements................. 6

         Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations........................ 8

         Item 3.  Control and Procedures.....................................17


PART II  OTHER INFORMATION...................................................18

Signatures...................................................................20

Exhibit Index................................................................21


<PAGE>


                                  VISEON, INC.

                                 Balance Sheets

<TABLE>
<CAPTION>
                                                                                  September 30,          June 30,
                                                                                      2002                 2002
                                         Assets                                    (Unaudited)
-------------------------------------------------------------------------------------------------------------------
<S>                                                                               <C>                  <C>
Current assets:
    Cash and cash equivalents                                                     $      8,808                   --
    Accounts receivable, net of allowance for doubtful
      accounts of $191,444 and $144,000, respectively                                  574,404            1,314,131
    Inventories                                                                      1,099,183            1,087,661
    Prepaid expenses                                                                    40,555               39,984
-------------------------------------------------------------------------------------------------------------------
             Total current assets                                                    1,722,950            2,441,776
-------------------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------------------
             Net property and equipment                                                652,667              720,431
-------------------------------------------------------------------------------------------------------------------

Intangible assets, net                                                                 175,109              204,529
-------------------------------------------------------------------------------------------------------------------

                                       Total assets                               $  2,550,726            3,366,736
===================================================================================================================

                          Liabilities and Stockholders' Equity
-------------------------------------------------------------------------------------------------------------------

Current liabilities:
    Checks issued in excess of cash in bank                                       $         --               51,919
    Revolving credit facility, net original issue discount                             827,827            1,269,339
    Subordinated notes payable, net original issue discount                             75,000
    Current portion of capital lease obligations                                            --                4,017
    Accounts payable                                                                 1,476,638            1,479,767
    Accrued expenses                                                                   184,517              204,745
    Deferred revenue                                                                   308,158              298,708
-------------------------------------------------------------------------------------------------------------------
             Total current liabilities                                               2,872,140            3,308,495

Stockholders' equity:
      Preferred stock ($.01 par value per share, 5,000,000 shares
             authorized, no shares issued or outstanding)                                   --                   --
      Common stock ($.01 par value per share, 50,000,000 shares
             authorized, 14,842,398 and 14,172,066 issued and outstanding)             148,425              141,720
      Additional paid-in capital                                                    22,415,602           21,713,645
      Accumulated deficit                                                          (22,885,441)         (21,797,124)
-------------------------------------------------------------------------------------------------------------------
             Total stockholders' equity                                               (321,414)              58,241
-------------------------------------------------------------------------------------------------------------------

                       Total liabilities and stockholders' equity                 $  2,550,726            3,366,736
===================================================================================================================
</TABLE>

See accompanying notes to financial statements.


                                       3
<PAGE>


                                  VISEON, INC.

                            Statements of Operations

<TABLE>
<CAPTION>
                                                           Three Months Ended  Three Months Ended
                                                              September 30,       September 30,
                                                                   2002               2001
                                                               (Unaudited)         (Unaudited)
-----------------------------------------------------------------------------------------------
<S>                                                           <C>                  <C>
Net sales                                                     $    632,526         $  1,616,619
Cost of goods sold                                                 569,429            1,009,577
-----------------------------------------------------------------------------------------------
         Gross profit                                               63,097              607,042

Research and development                                            25,189              108,906
Selling, general and administrative                              1,037,035              672,401
-----------------------------------------------------------------------------------------------
         Operating  loss                                          (999,127)            (174,265)

Other income (expense):
   Interest income (expense), net                                  (86,020)             (52,379)
   Other income (expense), net                                      (3,170)             102,386
-----------------------------------------------------------------------------------------------
         Other income (expense), net                               (89,190)              50,007
-----------------------------------------------------------------------------------------------

         Net loss                                             $ (1,088,317)        $   (124,258)
===============================================================================================

         Net loss per common share - basic                    $      (0.08)        $      (0.01)
         Net loss per common share - diluted                  $      (0.08)        $      (0.01)
===============================================================================================

         Weighted average shares outstanding - basic            14,313,903           11,668,981
         Weighted average shares outstanding - diluted          14,313,903           11,668,981
===============================================================================================
</TABLE>

See accompanying notes to financial statements.


                                       4
<PAGE>


                                  VISEON, INC.

                            Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                        Three Months Ended    Three Months Ended
                                                                         September 30,           September 30,
                                                                             2002                    2001
                                                                          (Unaudited)             (Unaudited)
-------------------------------------------------------------------------------------------------------
<S>                                                                     <C>                 <C>
Cash flows from operating activities:
    Net loss                                                            $(1,088,317)        $  (124,258)
    Adjustments to reconcile net loss to net cash
      used in operating activities:
        Depreciation and amortization                                        97,184              92,701
        Amortization of original issue discount                              88,281                 .00
        Compensation related to stock options                                59,020              51,126
        Warrants issued for services                                        261,941              21,116
        Changes in operating assets and liabilities:
           Accounts receivable, net                                         739,727            (709,575)
           Inventories                                                      (11,522)         (1,733,604)
           Prepaid expenses                                                    (571)            (17,734)
           Checks issued in excess of cash in bank                          (51,919)
           Accounts payable                                                  (3,129)          2,207,716
           Accrued expenses                                                 (20,228)            147,564
           Deferred revenue                                                   9,450             213,250
-------------------------------------------------------------------------------------------------------
             Net cash provided by (used in) operating activities             79,917             148,302
-------------------------------------------------------------------------------------------------------

Cash flows from investing activities:
    Proceeds from sale of furniture and equipment                                                 5,423
-------------------------------------------------------------------------------------------------------
             Net cash provided by (used in) investing activities                 --               5,423
-------------------------------------------------------------------------------------------------------

Cash flows from financing activities:
    Net borrowing on revolving credit facility                             (454,793)            (58,906)
    Payments on capital lease obligations                                    (4,017)            (14,124)
    Proceeds from issuance of common stock                                  350,000                 .00
    Proceeds from exercise of commonstock options                            37,701                 .00
-------------------------------------------------------------------------------------------------------
             Net cash provided by financing activities                      (71,109)            (73,030)
-------------------------------------------------------------------------------------------------------
             Net change in cash and cash equivalents                          8,808              80,695


Cash and cash equivalents at beginning of period                                            $    81,115
-------------------------------------------------------------------------------------------------------

Cash and cash equivalents at end of period                              $     8,808         $   161,810
=======================================================================================================

SUPPLEMENT CASH FLOW INFORMATION:
CASH PAID FOR INTEREST, NET ORIGINAL ISSUE DISCOUNT                          11,020              15,135
</TABLE>

See accompanying notes to financial statements.


                                       5
<PAGE>


                                  VISEON, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           September 30, 2002 and 2001


1.       DESCRIPTION OF THE BUSINESS:

Viseon, Inc. (the Company) founded in 1993, changed its name from RSI Systems,
Inc. to Viseon, Inc. on May 23, 2001. The Company designs, manufactures and
resells business level videoconferencing systems, services and accessories for
domestic and international markets. These systems are available in a variety of
configurations and price points through both direct and indirect sales channels.
During fiscal year 2002, the Company changed significantly, from being a sole
provider of its own videoconferencing systems, to a company, which also
distributes products and services provided by others. In the first quarter of
fiscal year 2003, the Company has again undergone a change from selling only
corporate videoconferencing systems and services to preparing to launch a new
product that is designed for the consumer video communications market. This
product is designed to allow video communications over residential and corporate
broadband Internet connections that are provided by cable and telephone
companies.


2.       BASIS OF PRESENTATION:

The unaudited interim consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of
America, pursuant to the rules and regulations of the Securities and Exchange
Commission. Accordingly, certain information and footnote disclosures normally
included in the consolidated financial statements have been omitted or condensed
pursuant to such rules and regulations. The accompanying unaudited consolidated
financial statements should be read in conjunction with the Company's June 30,
2002 consolidated financial statements and related notes included in the
Company's Annual Report on Form 10-KSB.

The consolidated financial statements include the accounts of RSI Systems Ltd. a
subsidiary in the United Kingdom, which is wholly owned by Viseon, Inc.

The consolidated financial statements reflect all adjustments, of a normally
recurring nature, necessary to fairly present the results of operations and
financial position of the Company for the interim periods. Operating results for
the three months ended September 30, 2002 are not necessarily indicative of the
results that may be expected for the year as a whole.


3.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Capitalized Software Costs. Software costs have been accounted for in accordance
with Statement of Financial Accounting Standards (SFAS) No. 86 "Accounting for
the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed". Costs
associated with the planning and design phase of software development, including
coding and testing activities necessary to establish technological feasibility,
are classified as research and development and expensed as incurred. Once
technological feasibility has been determined, additional costs incurred in
development, including coding, testing and product quality assurance is
capitalized, when material. At September 30, 2002 and June 30, 2002, the Company
had $565,290 and $625,612 respectively of unamortized computer software costs,
including software acquired.


<PAGE>


Liquidity. The Company has incurred losses from operations and negative cash
flows for the three months ended September 30, 2002 and 2001. Together with a
working capital deficit at September 30, 2002, these conditions raise concerns
about the Company's ability to generate positive cash flows and fund operations.

Management plans to increase sales and improve operating results through 1)
increased marketing and a broader distribution of products from a relationship
with a third party direct sales and marketing organization in the United States,
and through a select group of stronger resellers and distributors, 2) continued
measures to minimize overhead and 3) initiatives to protect its intellectual
property rights. Management believes that funds generated from operations and
funds from a credit facility will be sufficient to cover cash needs in the
foreseeable future. There is no guarantee these funds will be available with
terms favorable to the Company. In the event sales do not materialize at the
expected rates, or the Company does not achieve planned gross margins,
management would seek additional financing or would conserve cash by further
reducing expenses.

Intangible Assets. The Company amortizes patents over their estimated useful
lives of ten years using the straight-line method. Covenants not to compete are
being amortized using the straight-line method over the term of the covenants.
Accumulated amortization of intangible assets was $55,655 and $ 45,726 at
September 30, 2002 and June 30, 2002 respectively.

Revenue Recognition. The Company records sales revenue at the time products is
shipped. The Company ensures the transaction complies with the seven conditions
and the six considerations contained in Accounting and Auditing Enforcement
Release No. 108 of the Securities and Exchange Commission (SEC).

The SEC issued Staff Accounting Bulletin (SAB) No. 101, "Revenue Recognition."
SAB No. 101, as amended, sets forth the SEC staff's position regarding the point
at which it is appropriate for a registrant to recognize revenue. The staff
believes that revenue is realizable and earned when all of the following
criteria are met: persuasive evidence of an arrangement exists, delivery has
occurred or service has been rendered, the seller's price to the buyer is fixed
or determinable and collect ability is reasonably assured. The Company uses the
above criteria to determine whether revenue can be recognized, and therefore,
believes that the issuance of this bulletin does not have a material impact on
these consolidated financial statements. The Company adopted SAB No. 101 during
the year ended June 30, 2001 and the effect of adopting was not material to the
consolidated financial statements.

Accounts Receivable reserves. The Company maintains allowances for doubtful
accounts for estimated losses resulting from the inability of its customers to
make required payments. If the financial condition of the Company's customers
declined, resulting in an impairment of their ability to make payments,
additional allowances may be required.

Inventory valuation. The Company writes down excess and obsolete inventory equal
to the difference between the cost of inventory and the estimated market value
based upon assumptions about product life cycles, demand for the Company's
products, market conditions and other pertinent factors. If actual product life
cycles, product demand and market conditions are less favorable than those
projected by management, additional inventory write-downs may be required in
future periods.

Net loss per share. Basic net loss per common share is computed by dividing the
loss attributable to common stockholders by the weighted average number of
common shares outstanding for the reporting


<PAGE>


period. Diluted net loss per common share is computed by dividing net loss by
the sum of the weighted average number of common shares outstanding plus all
additional common stock that would have been outstanding if potentially dilutive
common shares related to common share equivalents (stock options and stock
warrants) had been issued. All options and warrants outstanding during the three
months ended September 30, 2002 and 2001 were anti-dilutive.


4.       REVOLVING CREDIT FACILITY:

In December 2001, the Company signed a commercial loan agreement with a bank for
a $3,000,000 line of credit facility that matures in December 2002. In
connection with the credit facility, the Company issued 200,000 warrants to
purchase common stock at $1.58 per share. The facility is secured by all
corporate assets and provides working capital based on a borrowing base
comprised of accounts receivable and inventories. Interest on outstanding
borrowings accrues at a 12% rate as of September 30, 2002. Outstanding
borrowings were $827,827 and $1,269,339 at September 30, 2002 and June 30, 2002
net of an original issuance discount of $13,277 and $26,558. The Fair Market
Value of the warrant is being amortized over the life of the credit facility
using the straight-line method.

Subordinated notes payable. In June 2002, the Company borrowed $300,000 and
issued five-year warrants to the various lenders to purchase 545,454 common
shares at $0.55 per share through June 2003. The notes are subordinated to the
bank, due on demand, mature June 2003 with monthly interest only payments at
10%, and are secured by substantially all assets of the Company. The
subordinated notes payable are also convertible into common stock of the Company
at a conversion rate of $0.55 per share through June 2003. The proceeds of
$300,000 were allocated between the notes and the warrants, which were valued
using the Black-Scoles pricing model. The resulting original issue discount of
$300,000 (the fair value of the warrants and the beneficial conversion of the
notes payable into common stock as defined in Emerging Issues Task Force (EIFT)
00-27 "Application of Issue No. 98-5 to Certain Convertible Instruments") is
being amortized over the life of the notes using the straight-line method, which
approximates the interest method. Amortization of the original issue discount
was $75,000 for the three months ended September 30, 2002. The notes may be
converted based on the terms of the agreement. Outstanding borrowings were
$300,000 at September 30, 2002 and June 30, 2002.


<PAGE>


5.       RELATED PARTY TRANSACTIONS:

         RSI Marketing, LLC
         In February 2001, in connection with a marketing agreement with a
         company to market its products and services, the Company issued the
         rights to purchase warrants for 1,000,000 shares of its common stock at
         an exercise price of $0.45. These warrants were valued at $206,300
         using the Black-Scholes pricing model. The warrants were issued based
         on the achievement of gross sales targets by December 2001. The
         warrants expire in February 2006.

         The Company is obligated to pay commissions based on the terms outlined
         on the agreement. Commission expense paid to RSIM for the three months
         ending September 30, 2002 and 2001 were $67,306 and $111,754.


6.       COMMITMENTS AND CONTINGENCIES:

a)       Manufacturing Agreement
         On August 28, 1996, the Company entered into a manufacturing agreement
         with a third party custom manufacturer (Manufacturer). Pursuant to this
         agreement, the Manufacturer agreed to produce the Company's
         videoconferencing products, and warrant that all products will be free
         from defects in material and workmanship for twelve months from the
         date the Company ships to the customer, or fifteen months from the date
         the Manufacturer ships to the Company, whichever comes first.

         The agreement may be terminated by either party upon failure of the
         other party to comply with any material term of the agreement after a
         30-day written notice and cure period. In the event of such
         termination, the Company would be obligated to pay for any goods
         accepted under the terms of the agreement. The Company may also
         terminate the agreement upon 30 days written notice. In such case, the
         Company may be obligated to pay for certain material and work in
         progress for products ordered. As of September 30, 2002, the Company's
         loss contingency for material and work in progress for products ordered
         amounted up to approximately $949,290.

         This amount represents the approximate cost to the manufacturer of
         goods purchased on behalf of the Company in support of the
         manufacturing of the Company's MediaPro product line that have not been
         incorporated into finished MediaPro products shipped and billed to the
         Company. This product line has not been the primary focus of the
         Company's sales and marketing activities during fiscal year 2002 since
         the Company's efforts have been directed toward sales of well-known
         brand name products owned and manufactured by other companies in the
         marketplace. In addition, the MediaPro product line does not contain
         certain features (primarily the ability to operate over IP networks)
         demanded by many customers in North America, where the Company has
         concentrated its sales efforts. These factors, when viewed in
         conjunction with the level of inventory purchased on behalf of the
         Company by the Manufacturer, create a contingency that could result in
         the Manufacturer claiming the Company is obligated to pay for the
         inventory it has procured to build MediaPro products.


<PAGE>


              The Company believes most of the future sales of the MediaPro
              product line will likely be made to international customers, who
              in the past have purchased the MediaPro product despite its
              inability to operate over IP networks. In the first quarter of
              fiscal year 2003, the Company did not sell any MediaPro products.
              In the event the Company cannot sell sufficient levels of MediaPro
              to utilize the inventory procured by the manufacturer within a
              reasonable amount of time, the Company and the manufacturer could
              enter into negotiations regarding ultimate responsibility for the
              goods. In such a case, and in the event an agreement is reached
              that obligated the Company to pay for all or a portion of the
              inventory, the Company could experience additional losses if such
              inventory costs were not subsequently recoverable through MediaPro
              product sales in the marketplace or other means. As of September
              30, 2002 the Company has not reserved for this contingency in its
              financial statements, as it currently believes that financial loss
              related to the matter is not probable.

b)       Investor and Recruitment Agreement

         a.   In February 2001, in connection with an agreement for seeking
              potential investors and recruiting and hiring senior management,
              the Company issued warrants to purchase 500,000 shares of its
              common stock at a price of $.45 per share. 50,000 warrants were
              issued and vested immediately and were valued at $10,315 using the
              Black-Scholes pricing model. In addition, 450,000 warrants vest at
              a rate of 37,500 quarterly and may vest earlier based on the
              achievement of earnings criteria as defined in the agreement. In
              connection with the agreement, 37,500 warrants vested and were
              valued at $7,736 using the Black-Scholes pricing model during the
              first quarter of fiscal year 2003. Through September 30, 2002,
              225,000 warrants have vested under this agreement and were valued
              at $46,416 using The Black-Scholes pricing method. The warrants
              expire in February 2006.

7.       Stockholders Equity (Deficit)
         During August 2002, the Company sold 333,333 shares of Company's common
         stock at $0.60 per share for proceeds of $200,000.

         During August and September 2002, the Company sold 249,999 shares of
         the Company's common stock at $0.60 per share for proceeds of $150,000.
         In connection with the sale of these shares of common stock, the
         Company issued 249,999 warrants to purchase common stock of the Company
         at $0.60 per share, which vest immediately with a term of five years.

         Subsequent Event
         In September 2002, the Company also issued 350,000 warrants to purchase
         common stock of the Company at $0.60 per share for consulting services
         valued at $254,205 using the Black-Scholes pricing model.

8.       In October 2002, the Company signed an agreement with Digital
         Investors, LLC to provide a line of credit to the Company if the
         Company is unable to obtain a line of credit with a bank by December
         2002 under terms and conditions similar to those contained in the terms
         sheet received from it's existing bank.


<PAGE>


          CAUTIONARY STATEMENT IDENTIFYING IMPORTANT FACTORS THAT COULD
            CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER FROM THOSE
                    PROJECTED IN FORWARD LOOKING STATEMENTS


In connection with the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, readers of this document and any document
incorporated by reference herein, are advised that this document and documents
incorporated by reference into this document contain both statements of
historical facts and forward looking statements. The forward-looking statements
subject to certain risks and uncertainties, which could cause actual results to
differ materially from those, indicate forward-looking statements. Examples of
forward looking statements include, but are not limited to (I) projections of
revenues, income or loss, earnings or loss per share, capital expenditures,
dividends, capital structure and other financial items, (ii) statements of the
plans and objectives of the Company or its management or Board of Directors,
including the introduction of new products, or estimates or predictions of
actions by customers, suppliers, competitors or regulatory authorities, (iii)
statements of future economic performance, and (iv) statements of assumptions
underlying other statements and statements about the Company or its business.

This document and any documents incorporated by reference herein also identify
important factors which could cause actual results to differ materially from
those indicated by the forward looking statements. These risks and uncertainties
include price competition, the decisions of customers, the actions of
competitors, the effects of government regulation, possible delays in the
introduction of new products, customer acceptance of products and services, and
other factors which are described herein and/or in documents incorporated by
reference herein. The cautionary statements made pursuant to the Private
Litigation Securities Reform Act of 1995 above and elsewhere by the Company
should not be construed as exhaustive or as any admission regarding the adequacy
of disclosures made by the Company prior to the effective date of such Act.
Forward looking statements are beyond the ability of the Company to control and
in many cases the Company cannot predict what factors would cause results to
differ materially from those indicated by the forward looking statements.


<PAGE>


                      MANAGEMENT'S DISCUSSION AND ANALYSIS


ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

Founded in 1993, Viseon, Inc. (the Company) changed its name from RSI Systems,
Inc. to Viseon, Inc. on May 23, 2001. The Company designs, manufactures and
resells videoconferencing systems, services and accessories for domestic and
international markets. These systems are available in a variety of
configurations and price points through both direct and indirect sales channels.
Recently, the Company has undergone significant change, from being a sole
provider of its own videoconferencing systems, to a company which also
distributes products and services provided by others. This fiscal quarter the
Company has begun transforming its business from a corporate videoconferencing
company to a company that sells visual communications devices to consumers and
business customers. The Company extends unsecured credit to customers in the
normal course of business.


RESULTS OF OPERATIONS


THREE MONTHS ENDED SEPTEMBER 30, 2002 COMPARED TO THREE MONTHS ENDED SEPTEMBER
30, 2001.

Net Sales. Net sales for the first quarter of fiscal year 2003 were $632,526
down 61% from $1,616,619, in the first quarter of fiscal year 2002. The decrease
in sales in the first quarter of fiscal year 2003 was primarily a result of
lower sales volume associated with the Company's new focus on consumer broadband
videophone sales in North America and the closing of our sales office in the
United Kingdom.

The Company has exclusive sales and marketing arrangement with RSI Marketing,
LLC (RSIM) whereby RSIM sells and markets the Company's products, as well as
those manufactured by others, exclusively in North America. The primary goal for
RSIM is to sell the Company's products directly to the video conferencing end
user. The current agreement is set to expire December 31, 2002. The Company has
begun discussions with RSIM with respect to negotiating a new agreement for
future marketing of the company's products.

Gross Profit. Gross profit was $63,097 in the first quarter of fiscal year 2003
compared to a gross profit of $607,042 during the first quarter of fiscal year
2002. Cost of goods sold as a percentage of net sales in the first quarter of
fiscal year 2003 were 90% compared to 62% in the first quarter of fiscal year
2002. The higher cost of goods sold as a percent of net sales during the first
quarter of fiscal year 2003 was due to continued competition in the corporate
videoconference market and accruals of additional potential returns due to the
company's change in business direction. During the first quarter of fiscal year
2003, the Company began focusing the majority of its efforts on its new Personal
Broadband Videophone product. The Company anticipates additional declines in
revenue while finishing the development of this new product.

Research and Development Expenses. Research and development expenses were
$25,189 for the first quarter of fiscal year 2003, or 4% of net sales, compared
to research and development expenses of $108,906 or 7% of net sales for the
first quarter of fiscal year 2002. Actual expenses decreased approximately
$83,717 as a result of a decrease in personnel in conjunction with the company's
utilization of independent third-parries to broaden its current product
offerings.


<PAGE>


Selling, General and Administrative Expenses. Selling, general and
administrative expenses were $1,037,035 or 164% of net sales for the first
quarter of fiscal year 2003 compared to $672,401 or 42% of net sales for the
first quarter of fiscal year 2002. The percentage increase was a result of
decreased sales during the first quarter of fiscal year 2003 and a higher than
normal non-cash expenses for variable stock option accounting rules, warrant
expenses and the closing of our United Kingdom sales office. Selling, general
and administrative expenses during the first quarter of fiscal year 2003
included approximately $19,006 non-cash expense related to the closing of the
United Kingdom sales office, $59,020 non-cash expenses related to variable stock
option accounting rule, $264,941 in warrant expense related to services rendered
by a consultant, and $88,821 of original issue discounts for loans received.
This totaled $431,788 in non-cash expense for the first quarter of fiscal 2003.

Other Income (Expense). Other income (expense) was $(89,190) in the first
quarter of fiscal year 2003, compared to $50,007 in the first quarter of fiscal
year 2002. The increase in expenses was primarily due to higher costs related to
additional subordinated debt and the absence of any patent licensing revenue for
the first quarter of 2003.

As a result of the foregoing, net loss for the first quarter of fiscal year 2003
was $(1,088,317), or ($.08) per common share compared to a net loss of
$(124,258) or $(.01) per common share in the first quarter of fiscal year 2002.


LIQUIDITY, CAPITAL RESOURCES AND MATERIAL CHANGES IN FINANCIAL CONDITION

Net cash provided by operating activities was $79,917 in the first quarter of
fiscal year 2003, compared to $148,302 in the first quarter of fiscal year 2002.

Accounts receivable declined $739,727 during first quarter of fiscal year 2003
as a result of decreased sales during the quarter compared to the fourth quarter
of fiscal year 2002. The principal reason for decline in revenues is due to the
Company beginning preparations for its new personal videophone product.

Inventory also increased during the first quarter of fiscal year 2003 as a
result of the Company's strategy to exit the corporate videoconference business.
Although the Company continues to actively sell these products, a significant
level of this inventory was sold at below cost in order to reduce its
requirement for office and warehouse space.

The Company issued 583,332 shares of common stock and warrants to purchase
599,999 at $.60 per share for net proceeds of $350,000 in the first quarter of
2003.

The Company's line of credit will expire on December 5, 2002. The Company has
begun discussions with its existing bank to renew its existing line of credit.
To date, no agreement has been reached and there can be no assurances that the
Company will be able to renew its line of credit by its current expiration date.

To ensure the Company has access to a line of credit sufficient to meet its
needs, the Company has an agreement with Digital Investors, LLC, under which
Digital has agreed to provide a line of credit to the Company under terms and
conditions similar to those contained in the terms sheet received from


<PAGE>


its existing bank. Under this agreement, Digital's agreement to provide a line
of credit is contingent upon the Company not signing a line of credit agreement
with a bank by December 5, 2002. The Company believes it will obtain a line of
credit sufficient for future operations from its existing bank, or
alternatively, Digital, as described above. However, there can be no assurance
that the Company will be able to meet the covenants and restrictions included in
such a new line of credit arrangement on an ongoing basis in the future.

Management believes that funds generated from operations, the $350,000 equity
investment recently received by certain investors, additional equity investments
and funds from a new line of credit yet to be secured from either a new bank or
Digital Investors LLC will be sufficient to fund operations for the next three
months. In the event that cash from operations, cash from subordinated debt
financing and a new line of credit are not sufficient, management would seek
additional equity capital or debt financing. There can be no assurance that such
financing will be available to the Company on reasonable terms or at all.


<PAGE>


CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires us to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of net revenues and
expenses during the reporting period. We regularly evaluate our estimates and
assumptions related to net revenues, allowance for doubtful accounts, sales
return and allowances, inventory reserves, goodwill and purchased intangible
asset valuations, warranty reserves, restructuring cost, litigation and other
contingencies. We base our estimates and assumptions on historical experience
and on various other factors that we believe to be reasonable under the
circumstances, the results of which form the basis for making judgments about
the carrying values of assets and liabilities that are not readily apparent from
other sources. To the extent there are material differences between our
estimates and the actual results, our future results of operations will be
affected.


REVENUE RECOGNITION
We believe the following critical accounting policies required us to make
significant judgments and estimates in the preparation of our consolidated
financial statements:

We do not recognize revenue until all of the following criteria are met:
persuasive evidence of an arrangement exists; delivery has occurred or services
have been rendered; our price to buyer is fixed or determinable; and
collectibility is reasonably assured.

When product sales revenue is recognized, we establish and estimated allowance
for future product returns based on historical returns experience; when price
reductions are approved, we establish an estimated liability for price
protection payable on inventories owned by product resellers. Should actual
product returns or pricing adjustments exceed our estimates, additional
reductions to revenue would result. Revenue from the licensing of patents is
recognized at the time of a patent agreement is executed and the goods, services
and/or cash are received. Revenue from post-contact customer support and any
other future deliverables is deferred and recognized over the support period or
as contact elements are delivered. Our product typically carries a ninety-day to
five-year warranty. Although we engage in extensive product quality programs and
processes, our warranty obligation is affected by product failure rates, use of
materials or service delivery cost that differ from our estimates. As a result,
additional warranty reserves could be required, which could reduce gross
margins.


ALLOWANCE FOR DOUBTFUL ACCOUNTS
We maintain an allowance for doubtful accounts for estimated losses resulting
from the inability of our customers to make required payments. Our allowance for
doubtful accounts is based on our assessment of the collectibility of specific
customer accounts, the aging of accounts receivable, our history of bad debts
and the general condition of the industry. If a major customer's credit
worthiness deteriorates, or our customers' actual defaults exceed our historical
experience, our estimates could change and impact our reported results.


INVENTORY VALUATION
Our policy is to value inventories at the lower of cost market on a part-by-part
basis. This policy requires us to make estimates regarding the market value of
our inventories, including an assessment of excess and obsolete inventories. We
determine excess and obsolete based on an estimate of the future sales demand
for our product within a specified time horizon, generally 24 months. The


<PAGE>


estimates we use for demand are also used for near-term capacity planning and
inventory purchasing is consistent with our revenue forecast.

If our sales forecast is less than the inventory we have on hand at the end of
an accounting period, we may be required to take excess and obsolete inventory
charges, which will decrease gross margin and net operating results for that
period.


<PAGE>


Item 3.   CONTROLS AND PROCEDURES

Within 90 days prior to the filing of this quarterly report, the Company's Chief
Executive Officer and its Chief Financial officer evaluated the Company's
disclosure controls and procedures as required pursuant to Rule 13a-14 under the
Securities and Exchange Act of 1934, as amended. Based on this evaluation, the
Chief Executive Officer and its Chief Financial Officer determined that such
controls and procedures were effective. There were no significant changes in
internal controls that could significantly affect the disclosure controls and
procedures since the date of the evaluation.


<PAGE>


                                     PART II
                                OTHER INFORMATION


Item 1.           LEGAL PROCEEDINGS

                  On August 14, 2002 the Company's subsidiary, RSI Systems Ltd,
                  received notice that the Bournemouth County court rendered a
                  judgement in the approximate amount of $85,903 for a claim
                  brought about by Sony (UK) Ltd, for a past due invoice,
                  interest and related legal fees. The Company is in the process
                  of reviewing such claim and expects to negotiate a settlement
                  with the plaintiff at an amount less than the full amount
                  claimed.


Item 2.           CHANGES IN SECURITIES

                  During August 2002, the Company sold 333,333 shares of
                  Company's common stock at $0.60 per share for gross proceeds
                  of $200,000.

                  During August and September 2002. The Company sold 249,999
                  shares of Company's common stock at $0.60 per share for gross
                  proceeds of $150,000. In connection with the sale of these
                  shares of common stock, the Company issued 249,999 warrants to
                  purchase common stock of the Company at $0.60 per share, which
                  vest immediately with a term of five years.

                  In September 2002, the Company also issued 350,000 warrants to
                  purchase common stock of the Company at $0.60 per share for
                  consulting services at $242,100 using the Black-Scholes
                  pricing model.

                  In October 2002, the Company signed an agreement with Digital
                  Invertors, LLC to provide a line of credit to the Company if
                  the Company is unable to obtain a line of credit with a bank
                  by December 2002.


Item 3.           DEFAULTS UPON SENIOR SECURITIES

                  None


Item 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                  None


Item 5.           OTHER INFORMATION

                  None


Item 6.           EXHIBITS AND REPORTS ON FORM 8-K

                  (a) Reports on Form 8-K

                           None


<PAGE>


                                   SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                        VISEON, Inc.

Dated:   November 18, 2002              By: /s/ John C Harris
                                            -----------------
                                                John C. Harris
                                        It's President & Chief Executive Officer


                                        By: /s/ John C Harris
                                            -----------------
                                            John C. Harris
                                        It's Chief Financial Officer


<PAGE>


                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                                   PURSUANT TO
                         SARBANES-OXLEY ACT SECTION 302

I, John Harris, certify that:

1.   I have reviewed this quarterly report on Form 10-QSB of Viseon, Inc.;

2.   Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3.   Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.   The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)   designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;

b)   evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

c)   presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5.   The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit committee
of registrant's board of directors (or persons performing the equivalent
function):

a)   all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b)   any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6.   The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 18, 2002                    /s/ John Harris
                                           ---------------
                                           John Harris
                                           Chief Executive Officer


<PAGE>


                                                        23
                                     CERTIFICATION OF CHIEF FINANCIAL OFFICER
                                                    PURSUANT TO
                                          SARBANES-OXLEY ACT SECTION 302

I, John Harris, certify that:

1.   I have reviewed this quarterly report on Form 10-QSB of Viseon, Inc.;

2.   Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3.   Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.   The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)   designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;

b)   evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

c)   presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5.   The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit committee
of registrant's board of directors (or persons performing the equivalent
function):

a)   all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b)   any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and

6.   The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 18, 2002                    /s/ John Harris
                                           ---------------
                                           John Harris
                                           Chief Financial Officer


                                       22
<PAGE>


                                  VISEON, INC.
                                EXHIBIT INDEX TO
              FORM 10-QSB FOR THE QUARTER ENDED SEPTEMBER 30, 2002


Item No.   Title of Document                       Method of Filing
--------   -------------------------------------   ----------------
99.1+      Chief Executive Officer Certification   Filed herewith electronically
99.2+      Chief Financial Officer Certification   Filed herewith electronically


----------------------------
+ Filed herewith.
* Denotes an exhibit that covers management contracts or compensatory plans or
arrangements.


The exhibits referred to in this Exhibit Index will be supplied to a shareholder
at a charge of $.25 per page upon written request directed to Secretary, Viseon,
Inc. at the executive offices of the Company.





                                       23