With or without Apple, the microLED industry maintains its momentum
MicroLED intellectual property landscape analysis shows high, sustained level of activity through 2023. Will Apple’s smartwatch cancellation affect future trends?
On February 28, Apple killed its microLED smartwatch project, laying off 87 and re-allocating the rest of the team.
Companies directly involved in the project, such as Osram, Kulicke and Soffa, LG, and possibly KLA, were hit the most.
Apple’s microLED smartwatch was an internal endeavor. The direct impact on the rest of the industry is limited.
The intellectual property landscape and dynamics, as illustrated in our upcoming report, confirm that the microLED industry has gained enough momentum of its own to keep advancing.
Today’s snapshot has been written by Eric Virey, Principal Analyst at Yole Group and is based on Yole Group’s collection of microLED reports: more information.
It has now been a little more than a month since Apple pulled the plug on its microLED smartwatch project. Yole Group wrote about the immediate and long-term impact of the decision on the industry in an initial article. The dust hasn’t settled yet, but we now have more clarity on what the future holds.
The news first hit ams-Osram, which immediately announced a US$648-$972M non-cash impairment for its 1.3 billion Euro (US$1.38 billion) , 200 mm microLED fab built for the project. This was followed by a similar announcement from Kulicke and Soffa, which was developing the mass transfer tools for the project and is taking a $110 to $130 million impairment.
Eric Virey, PhD
Principal Analyst, Display at Yole Group
I believe that the event was also the nail in the coffin for KLA’s display business (formerly Orbotech). On March 18, the company announced it was stopping its display-related activities, citing the “cancellation of a significant new technology project by a major customer” as a culprit. LG Display, which was to provide TFT backplanes and assembly services, as well as various equipment makers are also impacted, although not to the same degree.
Aside from companies directly involved in the project, it could, however, be argued that Apple’s decision didn’t alter the overall industrial landscape much. The reason is that the opportunity was essentially captive. Apple’s future microLED watch display was based on proprietary architectures and components almost entirely designed by the company, all the way down to the microLED chips, drivers, and assembly processes. Unlike OLED displays, where Samsung, LG, BOE, Tianma, and others are jockeying for design wins in the electronic giant’s smartphones, display makers and microLED startups had long known there was no room for them in Apple’s microLED smartwatch, at least until someone might one day come up with a design, performance, and cost so compelling that Apple would abandon its own design. Aside from those directly involved in the Apple projects, the microLED industry was, therefore, advancing on its own.
There is, of course, no denying that Apple’s cancellation is seriously undermining confidence in the technology and its prospects. Could anyone succeed where Apple failed after spending US$3 billion and ten years on microLED? Only three years ago, this would have been a fatal blow, but Yole Group believes that the microLED industry now has sufficient momentum of its own to keep going.
Since there is no high-volume commercial microLED market yet, one way to gauge this momentum is through patent activities.
Yole Group is finalizing the MicroLED IP for Displays 2024 report, and what analysts are seeing is a strong testament to this momentum. Our previous 2021 study showed that microLED display patent publishing activity was still on an exponential growth trajectory that started in 2014 when Apple acquired Luxvue and put the technology on the map. Exponential growth doesn’t last forever, however. Yole Group’s analysts anticipated some decrease. Instead, although plateauing, the activity remained high through the 2021-2023 period with more than 11,000 new patents, unphased by the COVID pandemic and other turmoil. All major display makers had high levels of activity during the period.
More than 11,000 new patents grouped in close to 5000 new patent families were published through the 2021-2023 period.
Leading startups are keeping up the pace; many newcomers, including more startups, OEMs as well as equipment and material suppliers, are joining in. There is a 12–18-month delay between the filing of patents and publication by patent offices, so 2021-2023 publishing trends reflect 2020-2022 filing activity. Nevertheless, the microLED industry has gained a strong momentum of its own, and companies other than Apple have taken the lead in terms of patenting activity. More than sheer numbers, the content of those most recent patents shows how the industry is progressing toward volume production.
Although its portfolio still has a lot of strength, Apple is no longer the leader in terms of sheer number of microLED display patents.
Apple’s project cancellation delt the industry a hard blow. It might temporarily lose its balance but it still has what it takes to move toward becoming a widespread, high-performance display technology. MicroLED first needs to succeed in various niches and highly differentiating applications with sufficient volumes to establish the supply chain and reach a critical mass and economies of scale to enable further adoption in consumer products. Samsung just added 76”, 101” and 114” models to its microLED TV offering, but for now, the spotlight is on automotive. AUO received very positive feedback at CES, and VueReal just made its collaboration with Continental official. In the short term, automotive and AR are the best hopes for microLED, but the smartwatch and other consumer products are still in sight.
About the author
As Principal Analyst, Display at Yole Group, Eric Virey, PhD is a daily contributor to the development of LED, OLED, and display activities.
He has authored a large collection of market and technology products as well as multiple custom consulting projects on subjects including business strategy, identification of investments or acquisition targets, due diligence in buying and selling, market and technology analyses, cost modelling and technology scouting.
Thanks to his deep knowledge of the LED/OLED and display industries, Eric has spoken at more than 30 industry conferences worldwide over the last five years. He has been interviewed and quoted by leading media all over the world.
Previously, Eric has held various R&D, engineering, manufacturing and business development positions with the Fortune 500 Company Saint-Gobain, based in France and the United States. Eric Virey holds a PhD in Optoelectronics from the National Polytechnic Institute of Grenoble.
Eric Virey, PhD Principal Analyst, Display at Yole GroupI believe that the event was also the nail in the coffin for KLA’s display business (formerly Orbotech). On March 18, the company announced it was stopping its display-related activities, citing the “cancellation of a significant new technology project by a major customer” as a culprit. LG Display, which was to provide TFT backplanes and assembly services, as well as various equipment makers are also impacted, although not to the same degree.
