Apple and the compound semi. industry. The story begins

A boon for consumers looking for more display area, but what will Apple’s anticipated iPhone 14 mean for materials companies’ fortunes? Ezgi Dogmus, and Ali Jaffal from Yole Intelligence, part of Yole Group consider the possible design change expected to differentiate the latest iPhone and what this could mean for the strategies of compound semiconductor companies in its supply chain. Discover today a snapshot of their analysis, based on the report, InP Wafer, Epiwafer and Device Market 2021: Photonics and RF Applications (2022 edition coming soon) and the Compound Semiconductor Quarterly Market Monitor.

An announcement about the next iPhone is expected at Apple’s Keynote event next week (7 September 2022). It is widely speculated that the company will change the aesthetics of its highest range smartphones, the iPhone 14 Pro family, reducing the size of the notch at the top of the screen.

The notch area in the Apple iPhone 14 Pro family to be reorganized behind a pill shape cut-out next to a hole for the RGB camera, using software to make the two new display cut-outs look like one seamless cut-out. Not only will this provide a larger display area, satisfying demand from users but it may also impact the business of the suppliers in the Apple supply chain.

To achieve this new front camera arrangement some other sensors will need to be placed under the display. Yole Intelligence expects proximity sensor currently supplied by STMicroelectronics and positioned in-between the two front cameras to be located under the display. This proximity sensor includes a GaAs VCSEL supplied by TRUMPF (formerly Philips Photonics). This 2022 move could prefigure a sequence of under display rearrangements notably the 3D face ID camera possibly from 2024 in the iPhone 16.

The complexities of placing any active depth ranging 3D sensor behind the smartphone display will require a move away from today’s 905 nm wavelength materials, a first step up to 10xxnm is expected in 2022, leading the way up to to 13xxnm or 15xxnm, in the Short-Wave Infrared (SWIR) band. The technology move will be needed to accommodate the low Near Infrared (NIR) transmissivity of OLEDs. For this reason, Yole Intelligence considers that SWIR proximity sensors and edge emitter lasers may be introduced in the near future. The same wavelength increases are likely to be required to enable under the display placement of the 3D camera and its combined flood/dot illuminators somewhere around 2024.

Yole Intelligence expects a progressive change in material platform, moving from GaAs VCSELs to InP lasers this year. There are already indicators of activity, such as the announcement from Taiwan by LandMark that it is entering the consumer market and delivering InP-based epi wafers. At the same time, the US company Lumentum has recently warned about a loss of market share and contract likely to the benefit of II-VI in a classical swipe in Apple’s suppliers to manage competition.

WinSemi, which has a huge capacity for GaAs VCSELs, has also entered the InP market, possibly manoeuvring into place as a second source for Apple in addition to the current main GaAs VCSEL suppliers Lumentum and II-VI. Could it mean that we can expect a massive transition from GaAs to InP platform in the next years?

Nevertheless, Yole Intelligence analysts have spotted that the InP technology platform is not new to the OEM. Actually, Apple has already used SWIR LEDs and InGaAs detectors in their AirPods 3 family to help differentiate between skin and other surfaces.

InP is, however, subject to quality issues and limited predominantly to 3” wafer capabilities today, with major players working on 4” wafers and some low volume 6” production.  The manufacturing equipment for GaAs and InP is similar so minimal investment for new manufacturing equipment, but the cost will lie in changing lithography equipment from 4” to 6” as well as adding extra manufacturing capacity. It remains to be seen if the integration of all sensors under the display area will be the impetus to adopt 6” InP wafer production.

Yet, this is not the end of the story for GaAs. GaAs technology is also being beyond its limits, for example long-wavelength Dilute-Nitrides based on GaAs VCSELs are already under development at British leading Epi-house, IQE. This begs the question, what level of competition will there be between GaAs Dilute-Nitride and InP in the coming year?

The impact of an innovative company like Apple adding a design element to differentiate its product significantly affects companies in its supply chain and vice versa. The US supplier, II-VI has broadened its sensing and 3D sensing technology portfolio and has gained market share with some recent 3D sensing design wins.

Another Apple supplier, the Austria-German ams-OSRAM, has announced a 2024 design win for its consumer sensing application.

We must wait to see the final details of the latest iPhone but it is clear that seemingly small changes introduced this year and next could change more than just the aesthetics of a smartphone and the user experience. From the compound semiconductor business perspective, could the new design finally bring the long-awaited consumer industry milestone for the InP technology platform? All eyes are on Apple now…

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About the authors

Ali Jaffal, PhD. is a Technology & Market Analyst, specialized in Compound Semiconductors and Emerging Substrates at Yole Intelligence.

As part of the Power & Wireless team, Ali is deeply engaged in the development of dedicated collection of compound semiconductors market & technology reports and monitor.

Previously, he worked at CEA-Leti (France) as a Research engineer. His mission was focused on the design, growth and clean room processing of GaAs semiconductor nanowires for Visible-infrared photodetectors. During his PhD, Ali deeply investigated the epitaxy (MBE) on InP nanowires dedicated to telecom applications.

Ali authored/co-authored 8 scientific papers in peer-reviewed journals and a patent on III-V nanowires at CEA-Leti. He also contributed to several presentations and was invited to numerous seminars within national and international conferences.

Ali Jaffal obtained his master’s degree in Nanotechnology from INSA (Lyon, France), Ecole Centrale de Lyon and Claude Bernard University (Lyon, France).

Ezgi Dogmus, PhD. is Team Lead Analyst in Compound Semiconductor & Emerging Substrates activity within the Power & Wireless Division at Yole Intelligence, part of Yole Group. With an international team of technology & market analysts, she is managing the expansion of the technical expertise and the market know-how of the company. In addition, Ezgi actively assists and supports the development of dedicated collection of market & technology reports, monitor as well as custom consulting projects.

Prior to Yole, Ezgi worked as a process development engineer for GaN-based RF and power solutions at IEMN (Lille, France).

After graduating from University of Augsburg (Germany) and Grenoble Institute of Technology (France), Ezgi received her PhD. in Microelectronics at IEMN (France).

Related event

InP and GaAs photonics quarterly markets: a chess game between two growing giants – Live Market briefing on October 12

Apple is changing the business outlook of InP and GaAs platforms…In this live market briefing, the evolution of InP and GaAs markets at the substrate, epiwafer and component levels as well as their respective ecosystems will be presented. Click HERE to get more information.