Posts Tagged ‘Sapphire laminate’

by Matt Margolis

Last week the Wall Street journal reported that Chinese Glass Maker Lens Technology International (LTI) is planing to raise $872 million in an initial public offering.   LTI is seeking to raise funds to expand production capacity to capture growing demand for consumer electronics.  More specifically the proceeds will be used to upgrade and expand production capacity of touch-screen glass covers and to make sapphire, which can be used in screen-cover production.  The Journal also reported that Apple and Samsung accounted for 84% of LTI’s sales in 2013.

LTI is currently is very involved with various substrate materials and coatings, including coatings for plastics, coatings for glass and metal coatings.  LTI also has chemists that focus on coatings for specialty applications that can work out an ideal coating solution for your plastic, glass, metal, paper, wood, and other products. LTI does not currently make sapphire nor does the company currently use sapphire coating.

Just over a week ago GT Advanced Technologies announced several new initiatives to expand its portfolio of SiC (Silicon Carbide) and Sapphire solutions for next generation consumer and industrial products.  Among the announcements made by GT was the company’s focus on selling the coating and bonding equipment as well as working with a leading glass substrate producer to develop specialty engineered substrate materials that can be bonded to ultra-thin sapphire lamina to create unique composite solutions that expand the reach of sapphire into a broader set of applications.  GT also announced that the company has acquired patent-pending technology for producing low-cost, scratch-resistant aluminum oxide coatings for various substrates including glass and plastics.

LTI is a very experienced company that is focused on coatings for various substrate materials including glass, plastics and metals.  GT  is expanding on the company’s immense knowledge of sapphire and is set to create an entirely new and untapped market for sapphire coated and laminated products that will expand the use of sapphire beyond today’s current applications.  Sapphire was originally used primarily in military applications but over the last few years the use of sapphire in LED lighting and in consumer electronics has exploded.

Sapphire is a unique material because of toughness, scratch resistance and optical clarity.  Sapphire coatings will create a nearly scratch proof protective layer on any substrate including plastics, glass, silicon and other materials.  In addition to sapphire coatings, GT is developing a bonding technique that would allow super thin Hyperion exfoliated sapphire lamina to be bonded to various substrates.  GT reported last week that the company’s Hyperion technology is consistently producing 2″ Sapphire lamina that only measures 28 microns thick.  GT’s sapphire lamina would provide significantly more scratch resistant solution and toughness versus nearly every other protective laminate on the market.  The only hurdle that remains to bring GT’s sapphire laminate solution to the market is successfully developing a method to bond sapphire lamina to various substrates including glass and plastics.

LTI is seeking to raise funds to expand production capacity to capture growing demand for consumer electronics.  LTI’s expansion includes growing sapphire to further diversify its current product offering.  GT’s patent pending sapphire coating technology along with itss sapphire laminate product would fit perfectly into LTI’s product portfolio. LTI is a seasoned veteran when it comes to successfully coating various substrates and adding sapphire coating and sapphire laminates would only strengthen the company’s position in the marketplace.  There is no indication that any discussions have been held between LTI and GT, but this is one relationship I wouldn’t mind seeing develop.

 

Full Disclosure: I am long GTAT

 

 

 

 

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by Matt Margolis

If you paid close attention a week ago to my Merrimack plant expansion and renovation news, you would be in my camp that we knew some sort of deal was coming.  I fully expect the expansion in Merrimack will be outfitting the manufacturing operations announced in today’s press release.  For full disclosure, I was kind enough to share Merrimack expansion news with a NH Business Review and they followed up with GTAT, asked some questions and put out a report.  Additionally, I took my efforts to Seeking Alpha to further expand the reach of the news.  I don’t believe GT was expecting someone to report on its planned and approved expansion before GT had a chance to “formally” announce its plans to the public.  Investors should be expecting GT’s management to touch upon both topics (Merrimack and today’s announcement) next week during the Q1 2014 conference call.

The biggest question I think everyone has is what is the size of the announcement and when will revenue hit?  GT’s CEO has already informed investors that he doesn’t build a mouse trap and wait for the mice.  Instead he works with the customers and gives them what they want.  GT put together a comprehensive expansion plan in just a few weeks for their Merrimack location.  GT was granted approval on April 1st and they want this project completed in 6 months or less. Reading between the lines and thinking outside the box (still haven’t found the box) I believe we could see some contribution of revenue in Q4 of 2014 in the neighborhood of $25 to $75m.  The key to sizing up today’s news is understanding the target markets along with the new products and adoption of those products that will occur.  If GT can sell the entire package of furnaces, Hyperion and bonding equipment to each interested party the value of today’s press release may add $500m or more in revenue to GT’s top line as soon as 2015.  GT would not shutter all or some of their R&D operations unless their was a significant slice of pie to be had.  I am very curious for an update on GT’s expected Hyperion market adoption rate.   GT is now selling a complete solution (growth, exfoliate and bond) versus just the selling the furnaces to grow materials.

According to Hyperion Lamina Production Technology press release:

The company has entered into a memorandum of understanding (“MOU”) with European-based EV Group (“EVG”), a global leader in specialty bonding and material handling equipment, to work together in various collaborative arrangements including jointly developing high volume production processes and equipment necessary to bond the ultra-thin sapphire and SiC lamina, produced by GT’s Hyperion™ technology, to engineered substrates such as glass, silicon, and plastics.

GT’s business model will be focused on selling the bonding and coating equipment developed through these initiatives.

“Our sapphire composite material development program is focused on leveraging the combined expertise of GT and our technology partners in order to build a new market for low-cost and highly-durable substrate solutions for next generation consumer and industrial products,” said Tom Gutierrez, GT’s president and CEO. “These programs enhance our technology portfolio and leverage our significant investment in our Hyperion technology.”

The announcement today regarding GT’s strategic initiatives surrounding Hyperion Lamina Production Technology was partially on my radar.  From reading previous conference call transcripts (see GT’s management comments at bottom) I knew GT was working on composite glass, however I had no idea they would enter the bonding market.  GT’s entry into the bonding market makes complete sense, if you think about how GT focuses on the entire product life cycle, from birth to end product.  GT’s announcement today allows them to own three significant processes within this entirely new product life cycle; material growth, exfoliating material in lamina and bonding the lamina onto various substrates (surfaces) including glass, plastics and silicon.  GT may produce composite material or sell equipment to produce composite glass, however this one item it still very unclear based on the press release.

#1 Selling Material Growth Equipment – GT can sell their SiC furnaces to produce Silicon Carbide and they can sell ASF furnaces to produce sapphire (under the exclusivity of the Apple deal consumer electronics is NOT an available marketplace)

#2 Selling Exfoliating Material Equipment – GT can sell Hyperion to exfoliate SiC and Sapphire into 25-50 micron thick lamina

#3 Selling Bonding Lamina Equipment – GT can sell equipment that will bond the lamina to various substrates (glass, plastics, silicon)

#4 Selling Composite Glass Equipment or Producing Composite Glass? – This one seems a little ambiguous but it looks like GT is partnering with a glass substrate maker to produce composite glass.  My open question is whether GT will produce or sell the equipment that will produce this new material.

GT’s announcement today and focus is broken into 3 product segments, Sapphire and Sic on glass, plastics and silicon.  Sapphire laminate on composite glass and Aluminum Oxide Coating.

Sapphire and SiC on glass, plastics and silicon

The company has entered into a memorandum of understanding (“MOU”) with European-based EV Group (“EVG”), a global leader in specialty bonding and material handling equipment, to work together in various collaborative arrangements including jointly developing high volume production processes and equipment necessary to bond the ultra-thin sapphire and SiC lamina, produced by GT’s Hyperion™ technology, to engineered substrates such as glass, silicon, and plastics.

Sapphire laminate on composite glass

GT announced it will begin working with a leading glass substrate producer to develop specially engineered substrate materials that can be bonded to ultra-thin sapphire lamina to create unique composite solutions that expand the reach of sapphire into a broader set of applications.

Aluminum Oxide Coating (Sapphire in a coating form) (Al2O3)

The company also announced that it has acquired patent-pending technology for producing low-cost, scratch-resistant aluminum oxide coatings for various substrates including glass and plastics. These coatings are expected to provide some of the durability and scratch-resistant properties of crystalline sapphire at a lower price point to address market opportunities where cost is paramount and not all of the properties of sapphire are required.

 

Below are some comments made by GT regarding their Sapphire business beyond Apple and LED over the last year (Comments via Seeking Alpha)

Q1 2013

In addition, we believe that, over time, our Hyperion solution, currently in the R&D phase, could enable further cost reductions that could bring sapphire solutions to cost parity with strengthened glass, further broadening the array of applications and actually increasing the demand for sapphire. Our early progress gives us added confidence that Hyperion will achieve these milestones.

Q2 2013

Well, I think there’s no gigantic bump in R&D for us to complete development of the project. I mean, we’ve moved around and prioritized our R&D spending accordingly. Hyperion is not a first-generation product. Hyperion is a follow-on second- and potentially third-generation product. And it won’t be the same as pure sapphire. There’s pure sapphire and then there will be these composite structures that will come out. And so we think it’s significant, but we don’t believe it will have an impact on first-generation adoption. It’s more of how does the — how do these applications unfold later. And Hyperion is — it is a tool that can be used with sapphire. But we’re just as excited, if not more excited about the applications of silicon carbide and silicon and other monocrystalline materials where, for example, silicon carbide wafer today and epi-ready wafer cost $800 to $900. We believe that we could substantially change that equation if we’re successful with silicon carbide lamina. So very exciting opportunities outside of sapphire, again, but not a short-term implication to it in the market.

Q3 2013

In support of the new materials business, we have accelerated the development of our next-generation launch capacity, low-cost ASF furnaces. Not only will these efforts support our initiative with Apple, we expect that it will enable the expansion of our LED, industrial and specialty sapphire businesses, positioning GT and its equipment customers as the industry’s lowest-cost sapphire producers. We’re very excited about the opportunities that lie ahead for our sapphire business.

Q4 2014

As strong as our sapphire opportunities maybe, the GT story is not just about our emerging sapphire business. In fact, our entry into the sapphire materials business may enable us to expand into other material segments whilst (sp?) we have fully ramped the operation in Arizona.

 

Full Disclosure: I am long GTAT and plan on using the money generated from this blog to buy additional shares of GTAT!

Hyperion is not part of GTAT’s Exclusivity with Apple – Now What? – by Matt Margolis

I’ve been seeing some recent chatter regarding comments TG made during the technology conference on held on 3/14/14.  TG indicated that Mesa, AZ was an Apple plant and that “Hyperion was not part of our exclusivity with Apple”.  So what does this mean?  In order to answer this question and chatter I always look to the past for specific comments made from TG to help understand his recent message.  For this one I turned back the clock to the Q4 2012 conference call.

Q4 2012 Conference Call TG Comments

We believe that current sapphire fabrication techniques, excluding Hyperion, will support the adoption of sapphire in several applications including smartphones and point-of-sale systems.

(Sapphire Laminates are) a broader application than what we would not consider to be the true smartphone area, where a pure sapphire solution is more likely, okay?

The comments from TG above definitely indicate that pure sapphire cover screens will support adoption for smartphones.  Apple wants sapphire for more than just the scratch proof strength and they will not settle for anything less than pure sapphire.  Also, if you take a look at Apple’s sapphire patents, it is quite clear that Apple has much bigger plans with pure sapphire versus just adding sapphire laminates to their devices.

Sapphire Laminate Marketplace

Since Apple does not appear to limit GT’s application of sapphire laminates layered on poly carbonate or glass substrates, the question is what market’s will they go after with this new technology?  One answer looks like the broader mobile phone market and tablet market place.  They could also supply Hyperion tools to an aftermarket player that wants to supply sapphire laminates for mobile or tablet marketplaces.  Other potential targets for sapphire laminates include navigation systems, music players, point-of-sale and touchscreen markets.  I came across a research report last week from Barclays who covers TPK.  The Barclays report gave confidence that TPK’s TOL (Touch on Lens) business related to sapphire laminates was anticipated to grow.  The report also indicated Apple was likely to introduce an iPad with sapphire laminates at some point down the road.  Needless to say there seems to be a lot of buzz in the sapphire laminate market outside of Apple’s pure sapphire solution.  Below are TG’s comments from Q4 2012 related to the potential sapphire laminate marketplace.

Q4 2012 Conference Call TG Comments

We also believe that there could be an incremental future market opportunity using Hyperion to create lower-cost sapphire laminates for broader mobile phone and aftermarket applications.

The objective (is)  to build another end to the business other than the high-end smartphone, the broader smartphone part of the marketplace.

Sapphire laminates are expected to have some, but not all, of the attributes of a pure sapphire solution and are expected to have a cost structure that rivals current cover glass products on the market today.

It’s really expanding into the lower part of the market that wouldn’t normally consider using a sapphire (solution) because the technique that we’re developing would get you a sapphire surface on a polycarbonate or glass substrate.

An aftermarket, if you think of the laminates and the substrate that are out in the marketplace that you put on your phone on an after-market basis to protect it, there’s a potential for creating an after-market laminate business here as well.

To make it clear, we’re not going to make laminates. We make Hyperion cleaving tools that we will sell to people that let them do that.

Full Disclosure I am long GTAT and have no plans to buy and sell any holdings in the next 72 hours

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Apple “Exclusivity” with GTAT is just Pure Sapphire? – by Matt Margolis

I spend a lot of time just thinking and digesting information while attempting to figure out the likely outcome.  One of my reader’s has been filling my email box with questions and items to follow-up on.   I want to thank George because he may have helped me connect some significant dots to determine what is actually “exclusive” in GTAT’s deal Apple.  I have been under the impression that GT can only use full sapphire cover screens for the smaller devices like the iPhone, iPod and thought it would be out of scope for the iPad and MacBook.  But you know what?  I think I might be wrong.  It all comes down to form factor.  What is form factor?

Form factor refers to a mobile phone’s size, shape, and style, as well as the layout and position of the phone’s major components.  As always, I dig into my comment archive and pull out a few rabbits to digest from GT’s CEO and CFO dating back to Q4 2012.

Tom Gutierrez GTAT CEO Q4 2012

Well, quite honestly, the problem doesn’t change with form factor. The screens, the bigger they’ve gotten, the more prone to breaking and cracking and scratching they are. But honestly, because the larger form factors you stick in your pocket, you don’t hold out. And so our view is the form factor doesn’t change anything. The form factors that we know of, that are being considered by the OEMs that we’re talking to, are inside the range that can be accessed by the technology, both on the fabrication side that’s being developed, as well as our growth technologies. If — one thing probably, as they get bigger, our growth technology probably has preferential treatment because of the form factor of our boules relative to some of the other technologies that are out there. So we’re comfortable. Nothing that’s happening in the marketplace is diminishing our opportunity. In fact, it’s just the opposite.

Richard Gaynor GTAT CFO Q4 2012

Out of the benefit of the technology that we have is that it can actually change the form factor of the boules that you produce. And so you can actually customize the size of the boule to the application you’re trying to build for.

I feel like I have a very good understanding of sapphire cover screen process and how they are produced but I did not realize GT can “change the form factor of the boules that you can produce”.   So if Apple wants a new sapphire screen that will measure 4″ by 3′ that is roughly a 5″ screen GT has the ability to “customize the size of the boule to the application you’re trying to build for”.  This is significant, very significant.  I have been picturing a large boule that needs to but carved a like Halloween pumpkin in order to produce sapphire screens.  Instead GT could conceivably grow a large square of sapphire measuring just over 4″ by 3″ in the exact dimensions Apple needs and they would just need cut them with the diamond wire saw to the desired thinness and then they go through the rest of the finishing process to make a screen.  The amount of sapphire that is wasted (unusable) from a grown boule appears to be very minimal.  If GT can grow boules very closely to the desired shape and dimensions it’s possible that less than 5-10% of the boule is wasted using GT’s technology.

Large Boule

My takeaway: GT can produce far more sapphire cover screens per furnace because there is limited waste.  Dividing more yield over the same base case also reduces your unit cost to make a sapphire screen.

Motorola MP6000

GT announced a deal with Motorola on May 2, 2013 to produce sapphire glass for their MP6000 Multi-Plane Scanner.    I found a youtube video of the scanner in action and it was posted on February 11, 2013 almost 3 months before GT announced the deal.  The date of the video tells me that GT was making these long before the announcement of the actual deal, but what’s even more important is the size of the sapphire glass used in the scanner.    From the tech specifications below the sapphire glass on the scanner measures 5″ by 4″ which is a whopping 7.5″ screen size.   I have been thinking that full sapphire cover screens would only be feasible for smaller devices, but this whole form factor technology has thrown me for a loop.

Screenshot - 3_9_2014 , 12_37_30 PMScreenshot - 3_9_2014 , 12_38_02 PM

Obscure Analyst Takeaway:

If Apple’s Mesa, AZ sapphire plant has enough furnaces to cover all of the Apple iDevices in full sapphire cover screens they will do it and they will do it in 2014.  Yes 2014!  Apple’s iWatch will use sapphire laminates because it needs the flexibility feature.   I’ve been firmly in the camp, that sapphire laminates would only be used down the road for Apple’s iPad and MacBook.  My reasoning for this stance was because Hyperion, will not be ready in 2014 to make enough sapphire laminate screens for Apple’s iPad and MacBook in 2014.  However, now that I know GT can make pure sapphire screens to nearly any size with little waste using their form factor technology.  It really makes me wonder if sapphire laminates will only be used in Apple’s iWatch.  Perhaps Apple owns exclusive rights to pure sapphire for the performance upgrade it offers over reinforced glass?  It’s very interesting GT’s CEO would not elaborate on the benefits of sapphire during the conference call because they are not in the public domain.  The performance upgrades that pure sapphire offers over reinforced glass must be significant and key to Apple’s future innovation.  If these benefits are so significant and not in the public domain today it makes sense why Apple made this HUGE investment in sapphire.

I also believe GT and Apple went splits on the Mesa furnaces with reach buying roughly 2,000 furnaces.   GT has given us their side of the equation after deploying $180 in PPE and announcing that $500-600m would be spent in capital expenditures in 2014 which is ample money to support 2,000 furnaces at $300k each.  Additionally, the language in the contract is ambiguous enough to support my theory and Apple’s $10.5B capital budget in 2014 can easily cover $600m in furnaces.  I also keep going back to comments made from Mesa officials that Apple (not GT) will be investing $1.5B of capital into the plant.  The primary focus that we know of is this plant will grow sapphire.  It only makes sense Apple is using a significant amount of the $1.5B capital investment to buy furnaces and the agreement does mention “Apple  owned” equipment that GT “will operate”.

I’ll leave you with a few more comments from Tom Gutierrez, including one from the Q4 2013 conference call just 2 weeks ago.  Is it possible Tom is agreeing with me?  I mean he does say assuming Hyperion will be heavily involved in Mesa, AZ is not “necessarily a good connection”.  Tom’s comment 2 weeks ago is also consistent with his comments made during the Q4 2012 conference call.  During the Q4 2012 call he stated current fabrication techniques, excluding Hyperion, will support the adoption of sapphire in several applications including smartphones (Apple) and point-of-sale systems (Motorola MP6000)”.  Lastly, Tom also points out that sapphire laminates do not have all the features of full sapphire; Sapphire laminates are expected to have some, but not all, of the attributes of a pure sapphire solution and are expected to have a cost structure that rivals current cover glass products on the market today”.

Tom Gutierrez GTAT CEO Q4 2013

I think you are making a connection there between Hyperion and the Arizona project. And that’s not necessarily a good connection. Hyperion has an incredible number of applications outside of that area and the growth in Hyperion is dominated by those other applications in our projection through 2016.

Tom Gutierrez GTAT CEO Q4 2012

Hyperion could also have potential application in our sapphire business. Given the feedback that we’ve received from OEMs and early adopters, we believe that current sapphire fabrication techniques, excluding Hyperion, will support the adoption of sapphire in several applications including smartphones and point-of-sale systems. However, we also believe that there could be an incremental future market opportunity using Hyperion to create lower-cost sapphire laminates for broader mobile phone and aftermarket applications. Sapphire laminates are expected to have some, but not all, of the attributes of a pure sapphire solution and are expected to have a cost structure that rivals current cover glass products on the market today.

So what does all this mean?  I’m under the impression now that the “exclusivity” of the Apple deal is specifically for full sapphire cover screens, which will come with the “performance upgrades” that Apple wants and GT can deliver and no one can talk about.  The sapphire laminate market might be the next place GT is going.  If GT can offer a new product that is like reinforced glass, at the same price with better scratch resistance, GT might not only steal someone’s Turkey, but also the sides and dessert that came with the Thanksgiving meal.  If my argument does not sound convincing enough, you should read the comments directly GT on this topic.

Tom Guiterrez GTAT CEO Q4 2012

On the sapphire cover glass, I mean, you could imagine being able to create a laminate. Say, a 30- to 40-micron laminate that you can essentially bond to a substrate glass or polycarbonate or something like that, so it’s more of a broader — it’s a broader application than what we would consider to be the true smartphone area, where a pure sapphire solution is more likely, okay? And so it’s really expanding into the lower part of the market that wouldn’t normally consider using a sapphire because the technique that we’re developing would get you a sapphire surface on a polycarbonate or glass substrate. Not as good as a pure thing, but quite good compared to current solutions in terms of scratch resistance. And so that’s the objective, is to create a — to build another end to the business other than the high-end smartphone or the smartphone — the broader smartphone part of the marketplace.

Tom Guiterrez GTAT CEO Q3 2013

We have also made similar progress developing low-cost composite glass and thin sapphire structures that we believe will have broad use in consumer applications

~Obscure Analyst 3/9/14

Full Disclosure I am long GTAT and have no plans to buy or sell any holdings in the next 72 hours.

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A Patented Review of Apple’s Upcoming iWatch by Matt Margolis

Apple’s iWatch patent was granted on February 21, 2013 under the name BI-STABLE SPRING WITH FLEXIBLE DISPLAY.  There is a significant amount of technical information and detail provided in the patent.  I have tried to do all of the dirty work for you and summarize the technological specifications as well as assess whether some of the juicy options should be expected or not expected in the 2014 version of the Apple iWatch.  Listed below are some significant claims associated with the iWatch patent:

A wearable accessory device is disclosed. The wearable accessory device includes a flexible display coupled to a bi-stable spring. Coupling the display to the bi-stable spring allows the accessory device to be easily worn in a number of convenient locations.

A wearable video device arranged to be worn by an end-user, comprising: a flexible substrate having a flat state and a curled state; a flexible display disposed upon a first surface of the flexible substrate, wherein in the curled state the flexible substrate conforms to an appendage of the end-user, the flexible substrate further comprising: an electronic module in communication with the flexible display, the electronic module providing information to the display, at least a part of which is presented in real time for presentation by the flexible display; and a mechanism for detecting an end portion of the flexible display, the detection for adjusting the arrangement of information shown on the flexible display to match the size of the appendage the wearable video device is mounted on.

 [0008] A method for passing information between an accessory device disposed on one surface of a bi-stable spring substrate and a portable electronic device is disclosed. The accessory device includes a flexible display arranged to present a first set of visual information. The portable electronic device has a portable electronic device display arranged to present a second set of visual information. The method includes the following steps: (1) determining whether the accessory device is being worn by an end-user where the determining is accomplished by at least one sensor on the accessory device; (2) when it determined the accessory device is being worn by the end user, establishing a communication channel between the accessory device and the portable electronic device where the communication channel is arranged to provide a bi-directional communication link between the flexible display and the portable electronic device; (3) passing information between the portable electronic device and the accessory device by way of the bi-directional communication link, where at least a portion of the passed information is presented by the flexible display as the first set of visual information; and (4) displaying the first set of visual information by the flexible display.


[0009] A slap bracelet configured to display information wirelessly transmitted from a portable electronic device is disclosed. The slap bracelet includes at least the following components: (1) a communication link, allowing two-way communication between the slap bracelet and the portable electronic device; (2) a flexible display disposed over a portion of a first surface of the slap bracelet; (3) a touch sensitive user interface disposed over the top of the flexible display; and (4) an electronic module disposed on one end of the first surface of the slap bracelet. Information generated on either device can be displayed on either the host device display or the flexible display.

What Apple’s iWatch could feature based on my review of the patent:

Technological Specifications

  • Worn on leg
  • Worn on arm
  • Solar Power
  • Kinetic Energy
  • Solar Panel Array
  • Wireless Communication Between Devices
  • 2 Batteries – Integrated Device and a Solar Powered/Rechargeable replaceable battery
  • Read email and documents
  • Video capability

Form Specifications

  • Curved Display over a Flat State that rest on the body
  • Flexible Display possibly OLED
  • Flexible straps that confirm to the body “slap bracelet”

Kinetic Energy Charging (Not Likely)

Kinetic energy is listed above as a potential power source within the iWatch patent, which would be used to power one of two potential iWatch batteries. In addition to the patent, Apple has had discussions with Swatch Chief Nick Hayek about materials for products and so-called energy harvesting “Kinetic Energy” technology that would generate energy from physical movement. A lesser know company, n M2E Power was focused on developing motion powered charges and energy storage devices but the company was sold in 2009 to Motionetics and not much is known if they continued this work or dropped the project all together. Kinetic energy is currently used to power watches, but the power draw from a smartwatch would require significant technological improvements and I’m just not sure we are there yet.

Solar Power (Very Likely)

October 31, 2013 Apple was granted a new solar touch screen patent, that will allow Apple to power a device, without the need of a “boost converter,” which will lead to fewer issues squeezing components underneath the hood of Apple’s devices. This is a significant improvement from the February 2013 patent. Although the iWatch was not listed under the electronic devices we all know that it is on the list. The patent’s technical details are below:

Apple’s patent filing states that in the absence of the power adapter and/or mains electricity, the portable electronic device may be powered by the battery until the battery is fully discharged. Because the battery has a limited runtime, operation of the portable electronic device may generally be dependent on the availability of mains electricity. Hence, use of portable electronic devices may be facilitated by improving access to power sources for the portable electronic devices.

Apple’s invention relates to providing a power management system that supplies power to components in an electronic device. The power management system includes a system microcontroller SMC and a charger. The electronic devices that will be able to take advantage of Apple’s new solar panel include a MacBook, iPad, iPod touch and iPhone.

During operation, the power management system accepts power from at least one of a power adapter and a solar panel. Next, the power management system supplies the power to components in the electronic device without using a converter circuit between the solar panel and the power management system.

December 2013 Curved Touch Sensor Patent (Very Likely)

Apple was awarded a curved touch sensor patent on December 10, 2013. The curved patent description aligns closely with the iWatch forms, that were called out in the iWatch patent including; “curved touch surface”, “flat state” and “flexible substrate”. The use of thin films could indicate solar cells and/or sapphire laminates. The curved touch sensor patent abstract is below:

A method of forming a curved touch surface is disclosed. The method can include depositing and patterning a conductive thin film on a flexible substrate to form at least one touch sensor pattern, while the flexible substrate is in a flat state. According to certain embodiments, the method can include supporting the flexible substrate in the flat state on at least one curved forming substrate having a predetermined curvature; and performing an anneal process, or an anneal-like high-heat process, on the conductive thin film, wherein the anneal process can cause the flexible substrate to conform to the predetermined curvature of the at least one curved forming substrate. According to an embodiment, the curved forming substrate can include a first forming substrate having a first predetermined curvature and a second forming substrate having a second predetermined curvature complementing the first predetermined curvature.

Flexible Sapphire Display Made with Liquidmetal (Is Possible)

Apple has been dealing with screen technology issues and one way to remedy this problem is through one of their recently awarded patents filed in Europe. The flexible transparent sapphire wraparound display patent might have been the cure needed to address screen flexibility issues Apple has been experiencing. According to the patent, Apple’s sapphire and transparent display would be made using an alumina powder liquidmetal process and could be used in smartphones as well as devices like smartwatches.  Liquidmetal might be making its first major appearance in Apple iOS devices via the iWatch.  Below are some highlights of the patent:

The device may display content that moves or that remains at a fixed location on the surface of the flexible display layer. For example, the electronic device may display pages of content on the display layer in response to tilt events or other motions of the device.

The electronic device may also adjust scrolling activity and other on-screen content motions based on detected device rotation and other measured movement of the device.

The flexible wraparound display device would still feature a touchscreen, accelerometer, gyroscope and other sensors for user input

iWatch Yield and Battery Life Issues and Sapphire Attachment Technique

The iWatch design team has been working feverishly to address battery life and display issues. The curved, flexible iWatch display has been giving Apple fits for sometime. The battery life has been less than desirable as Apple is attempting to extend the battery life to 4 to 5 days without a charge. The smartwatch battery life issues date back to the middle of 2013. Apple is focused on implementing a longer-lasting battery that would allow the device to live without charge for up to five days. In addition to the battery and display issues Apple lost a key member of the iWatch team Bryan James, who left in January to join Nest Labs.

I believe the recent wave of sapphire patents filed by Apple over the last month stemmed from Apple’s focus on resolving the flexible screen and battery life issues. The iWatch will spend a significant amount of time under the hot sun compared to a iPhone, which will result in increased heat coming to the device, which could be contributing to the battery life issues Apple has been reporting. One of Apple’s most recent patents entitled “Attachment technique,” describes the sapphire mounting process as well as using sapphire as a heat spreader to dissipate heat generated by the processor. My takeaway, this critical patent will be deployed on the iWatch to help push heat away from the processor, which will help improve the overall battery life.  Below is an excerpt from the attachment technique patent:

0025] With particular reference to sapphire, the presently discussed techniques allows the effective use of sapphire in a variety of different applications without the risks associated with conventional attachment techniques. For example, sapphire may effectively be attached to a frame of a mobile computing device as a cover glass for a display screen. Additionally, as sapphire’s thermal conductivity is on the order of metals, it may effectively be implemented as a heat spreader. That is, sapphire may be attached both mechanically and thermally to a processor. More specifically, a sapphire substrate may be used as a processor mount to dissipate heat generated by the processor.

[0026] Referring to FIGS. 1A and 1B, an example mobile computing device 100 is illustrated. The mobile computing device 100 includes a first side 102 that may include a transparent cover 104. In some embodiments, the transparent cover 104 may take the form of a sapphire sheet, a sapphire sheet with a glass laminate layer, a plastic, or other suitable material, through which a visual output of the device 100 is output. Additionally, the cover 104 may be configured to receive input from users via a capacitive sensor, for example. A second side 106 (FIG. 1B) of the mobile computing device 100 includes a camera with a cover 108. As with the transparent cover 104 of the first side 102, the cover 108 may take any suitable form, such a sapphire.

GT Advanced Technologies: Will supply Sapphire and Solar Cells to Apple? (Very Likely & Possible)

GT Advanced Technologies will be supplying sapphire displays for Apple’s up coming iPhones, but is there more to this cover story beyond sapphire? Apple is big on green energy and is already leveraging solar power supply for several large facilities (data center, corporate headquarters, etc) being constructed today. GT is very familiar to solar technology and after review of their recent patents it appears likely that they will be entering the super thin-film marketplace, for the solar industry and consumer electronics.

In one of my most recent publications at Seeking Alpha I went into depth how GT is positioning themselves to electrify the Mobile World. GT Advanced Technologies’ (GTAT) epitaxial growth on thin lamina patent was published on 2/6/14. Epitaxy is defined as the growth of a thin layer on the surface of a crystal so that the layer of growth has the same structure as the underlying crystal. GT’s patent essentially enables the growth of a semiconductor material on a donor body, by firing GT’s Hyperion’s ion cannon which splits (exfoliates) the semiconductor material from the donor body, to form a super thin lamina (layer) of the semiconductor material. The resulting lamina from the first process can be exfoliated by Hyperion a second time to form an additional semiconductor lamina.

One of the most interesting findings within this patent was related to PV (photovoltaic), specifically the creation of a triple junction PV cell and the ability to incorporate the thin (PV cell) lamina into an electronic device. Not only does GT have the ability to create thin-film solar cells but they also have the ability to stack the thin-film solar cells to form a triple junction PV cell that is still less than 25 microns thick before it is incorporated into an electronic device all while rocking a 40%+ efficiency rating. Below are some details from the epitaxial growth on thin lamina patent.

In some embodiments a triple junction PV cell may be fabricated with lamina such as a germanium lamina

The combined thickness of the lamina and epitaxial layer may be between about 2 microns and about 25 microns such as between 15 and 25 microns. One, two or more additional layers may be formed on the either surface of the lamina/epitaxial layer assembly before incorporating the lamina into an electronic device.

 

 

Full Disclosure I am long GTAT and have no plans to buy or sell any holdings in the next 72 hours.

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Apple iWatch Likely to Feature Sapphire Display from GT Advanced Technologies by Matt Margolis

 

Apple’s iWatch patent was granted on February 21, 2013 under the name BI-STABLE SPRING WITH FLEXIBLE DISPLAY.  One clear takeaway is Apple wants this device to have a flexible display and watches need to be durable to take a licking and keep on ticking.  The toughest thinnest flexible display I can think of is sapphire laminate courtesy of GT Advanced Technologies via their Hyperion tool.

A wearable accessory device is disclosed. The wearable accessory device includes a flexible display coupled to a bi-stable spring. Coupling the display to the bi-stable spring allows the accessory device to be easily worn in a number of convenient locations.

A wearable video device arranged to be worn by an end-user, comprising: a flexible substrate having a flat state and a curled state; a flexible display disposed upon a first surface of the flexible substrate, wherein in the curled state the flexible substrate conforms to an appendage of the end-user, the flexible substrate further comprising: an electronic module in communication with the flexible display, the electronic module providing information to the display, at least a part of which is presented in real time for presentation by the flexible display; and a mechanism for detecting an end portion of the flexible display, the detection for adjusting the arrangement of information shown on the flexible display to match the size of the appendage the wearable video device is mounted on.

Screenshot - 3_6_2014 , 8_58_22 PM

Sapphire Laminate Patent Awarded September 2013

Apple was awarded a sapphire laminate patent on September 12, 2013. The patent is very detailed and goes over various forms, uses and assembly options. The patent lists sapphire laminates as a potential cover for nearly everything from phones to watches. The abstract and a key a claim are represented below:

Various sapphire and laminate structures are discussed herein. One embodiment may take the form of a sapphire structure having a first sapphire sheet with a first sapphire plane type forming the major surface and a second sapphire sheet having a second different sapphire plane type forming the major surface. The first and second sapphire sheets are fused together to form the sapphire structure.

0022] Turning to FIG. 1, an example electronic device 100 is illustrated in which a sapphire structure or laminate may be implemented. For example, a sapphire laminate 102 may be utilized as a cover glass and/or back plate of the device 100. Additionally, or alternatively, a sapphire laminate may be utilized as a cover and/or lens for a camera of the device. It should be appreciated that the sapphire laminates may be utilized in various different devices. For example, they may be used for windows, mirrors, cover glass, lenses and so forth in cameras, computers, mobile devices, watches, display devices, touch screens and clocks among other things.

Apple Posts Sr. Module Process Engineer Positions  December 2013

As the world was prepping for new year’s eve celebrations Apple was preparing for their iWatch product ramp up. On December 31st, Apple posted a Sr. Module Process Engineer position located in Taiwan.  The job description indicates that this “role will serve as a focal point in the design and process development of advanced key modules from concept stage to high volume ramp up.   Additionally, under key qualifications the position calls out “experiences in developing and manufacturing high volume display products“. Lastly, the key qualificationsinclude back-end process in flat panel industry, including bonding, laminate and module design.

My takeaways: The position is focused on taking a key module (device) from concept to high volume product ramp, which tells me this product has yet to be mass-produced.  The position is focused on displays (due to experience developing high volume display products).  The unique experience with flat panel industry, bonding and laminate and module design is very intriguing.  Laminates are super thin pieces of substrate, bonding is the process to fuse/epoxy laminates to a substrate and lastly back-end flat panel industry would give someone experience wedging material between two thin substrates. For example, back-end process experience with LCD flat panels would give someone experience placing liquid crystals between two electrically conducting plates.  Is it possible that solar panels would be placed between two electrically conducting plates of sapphire laminates in lieu of liquid crystals?

My conclusion: this position is for a new product (iWatch), that will feature a new type of laminate display (sapphire) and is on the verge of entering the high volume product ramp phase ahead of a 2014 release.

Sr. Module Process Engineer Job Description

Individual in this role will serve as a focal point in the design and the process development of advanced key modules from the concept stage to the high volume product ramp.

Key Qualifications

  • The idea candidate will need to have 3 years of hands-on experience and proven track record in the design and development of the module process & its integration, or the back-end process in flat panel industry, including bonding, lamination and module design.
  • Demonstrated ability to perform DOE, SPC and failure analysis is a must. Experiences in developing and manufacturing high volume display products are preferred.
  • Excellent written & verbal communication skills and people skills are required.
  • The willingness and ability to travel to Asia are also required.
  • Education:
  • Ph.D. degree in Physics or Mechanical Engineering or MS degree

GT’s One of a Kind Sapphire Laminate Technology

GT Advanced Technologies acquired Twin Creeks Technology late in 2012 and one of their first primary focuses was to “to pursue the development of thin sapphire laminates for use in applications such as cover and touch screen devices”. The Hyperion ion implanter machine acquired from Twin Creeks can cut ultra thin wafers (25 microns thick) out of silicon, silicon carbide, sapphire, germanium and other crystalline materials. How thick is 25 microns? The laser sliced sapphire home buttons on the iPhone 5s measure 170 microns thick, which is nearly 7 times the thickness of the sapphire laminates that can be sliced by GT’s Hyperion. The Hyperion machine takes a thick block of crystalline sapphire, blasts it with hydrogen ions and exfoliates a 25 micron layer thick sheet of sapphire from the block. The process is repeated over and over until the block is completely separated.  As of November 2013, GT expected the pace of the development with Hyperion to accelerate.  Hyperion is expected to be commercial ready by 2015, which will also require GT to begin assembly of Hyperion in larger numbers sooner rather than later.  

 iWatch Sapphire Laminate Fact List

  • November 2012 GT acquires Twin Creeks and focuses its pursuit on sapphire laminates for use in cover and touch screens
  • September 2013 – Sapphire Laminate Patent was awarded to Apple (filed March 2013)
  • November 2013 – Apple signed a $578m contract with GT Advanced Technologies to make sapphire material. Additionally, in GT’s 10-Q they informed investors that the, “Company expects to pursue the development of thin sapphire laminates for use in applications such as cover and touch screen devices”.
  • November 2013 – GT updated investors that their Hyperion machine, one of a kind laminate (sapphire) machine is in pre-production. In addition, the Hyperion technology pace of development was expected to accelerate as the company has targeted the technology for commercial use in 2015.
  • December 2013 – Apple posted several Sr. Module Process Engineer positions across the globe.
      • Focus on taking advanced key modules from the concept stage to high volume product ramp.
      • Requires experience with laminates, flex bonding and flat panel industry.
      • Requires experience with high volume display products.
      • Individual must be willing and ability to travel to Asia
  • The iWatch assembly is expected to be performed in Asia

Conclusion:

Given the expected iWatch display size  (2 x 2 inches) and unit sales (10-20m in 2014), I believe the iWatch product launch would be a perfect way to utilize GT’s Hyperion technology to mass produce sapphire laminate displays.   Furthermore, could the Hyperion technology, which was originally for created for solar cells, be the technological bridge that enables GT to provide solar cells across Apple’s portfolio of iDevices?

 

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Full Disclosure: I am long GTAT and have no plans to buy or sell any holdings in the next 72 hours,