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  • UniPixel: Intel Shows Its Touch Sensor Hand 42 comments
    Apr 9, 2013 9:05 AM | about stocks: UNXL

    The Intel Developer Forum (IDF) is taking place on 4/10 & 4/11 in Beijing. One of the technical sessions at IDF is titled "Touch On All Client Devices and The Ecosystem To Support It." The talk is supposed to address forecasts for touch sensors in notebooks, ultrabooks, and All-In-One PCs in 2013, Intel's initiatives to increase supply and lower cost for touch sensors, and current and prospective technologies to meet the growing touch demand at new lower price points.

    In past instablog posts I've noted how crucial it is for Intel and Microsoft to find a large supply of inexpensive touch sensors. Doing so could move the needle quite a bit in terms of notebook/ultrabook/AIO sales, and could help these ecosystems in their battle against Apple's iPad.

    Intel has placed its bets and the company is showing its hand to all of us at IDF. Look at the list of speakers at the session. It includes FlatFrog, Cambrios, and UniPixel. Intel has scoured the world for the last couple years trying to find technologies that could fill the void in large-display touch sensors, and these are the three technologies they've engaged.

    Intel has spread its bets. They're covering the materials angle with Cambrios, the optical solution with FlatFrog, and the printed mesh with UniPixel.

    FlatFrog is an optical touch sensor manufacturer based in Sweden. Intel made a $25mn investment in the company last year. They've recently done another raise with Invus and Promethean leading. FlatFrog is using the funds to commercialize touch sensors for the very large display market. They target education, gaming, hospitality, and digital signage. They are still deveoping solutions for the markets which UniPixel addresses. I would imagine their technology is similar to that of Neonode, but they seem to be a bit behind NEON in smaller displays.

    Cambrios makes ClearOhm coating material that replaces ITO in an industry standard touch sensor. Cambrios has some impressive wins and has made good progress. Yet this wager seems to be more about Intel's hedging against rising ITO prices than anything else. Cambrios can potentially lower the materials cost in a touch sensor, but it relies on the expensive and time-consuming production processes associated with the ITO touch sensor supply chain.

    UniPixel is the latest addition to Intel's hand. Intel evaluated every metal mesh solution known to man before teaming with UniPixel. They would have looked at Fuji, LG Chem, Toppan, DNP, Kyodo, Mirae Nano, Atmel and others. But Intel decided that UniBoss was the right horse for the wager. This speaks volumes to UNXL's claims that they have the only truly additive, copper-based product available. It also speaks volumes to the idea that UniBoss involves a highly scalable production process.

    With Intel's bet, evaluating UniPixel is no longer a game of trying to figure out how much demand there is for UniBoss. We now have volume commitments from Dell and Intel for 12mn units/yr each, and we know that the numbers can get much larger than that - quickly. It's no longer a competition with Fuji, or XSense, or ITO, it's now just a matter of how much UniBoss UniPixel can produce and how quickly they can produce it.

    Disclosure: I am long UNXL.

    Stocks: UNXL
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Comments (42)
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  • Given the recent ecosystem partner, rumored to be Intel, it seems as though Intel has perhaps created its final bet in this space and are just keeping FlatFrog and Cambrios in play as a hedge. This is extremely bullish for Unipixel... it is unfortunate for longs that the market doesn't see this (yet).
    9 Apr 2013, 09:57 AM Reply Like
  • That's great, thank you GRA!
    9 Apr 2013, 10:11 AM Reply Like
  • Agreed. How fast can they ramp. I for one believe the ramp will be much faster than most believe. The company has stated each printing line can do well over a million units a month. The company currently has 3 printing presses on site or scheduled to arrive in the next month or 2. The company indicates they will have 3 plating lines up and running capable of 225,000 - 300,000 units by the end of May. They also intend to have 4 plating lines delivered in June and will have additional lines delivered each month The new plating lines will be larger units capable of larger quantities that most expect. The company indicated on it's last call 100,000 units a month was a conservative estimate. So by the end of July it is very possible that the company will have the ability to produce 750,000 units a month. That could increase 400,000 units a month moving forward.


    The customers are here and more will be looking for uniboss. production is ramping fast as the summer progresses. Analysts are seeign the potential. If you want to board the train prior to it leaving the station the time is now. Wait until July and the price will be north of $40.
    9 Apr 2013, 10:16 AM Reply Like
  • Scott-


    I'm sure you saw this from Digitimes: "Intel recommends 3 touch solution providers to ultrabook ODMs" (appended below). Interesting that Carclo/CIT is NOT a recommended solution, and therefore neither is Atmel's Xsense. I'm not sure how much leeway ODMs will take in designing touch modules for Intel products that are not recommended but this would seem to put Atmel in a tough situation given that they did an exclusive with Carclo/CIT.


    On the call on Monday, Reed indicated they (paraphrasing): "could work with Atmel" (and he volunteered that essentially unprompted after saying they are controller agnostic; there was no question asked about Atmel) and that they just qualified their sixth controller company on Uniboss. Any thoughts on the likelihood that Atmel is now working with Unipixel? The Intel endorsement seems to make it inevitable.


    Intel recommends 3 touch solution providers to ultrabook ODMs
    Monica Chen, Taipei; Joseph Tsai,
    DIGITIMES [Thursday 18 April 2013]


    Intel, in line with boosting touch screens in third-generation ultrabooks, has recommended three touchscreen solution providers, Cambrios Technologies, FlatFrog and UniPixel, to ODMs, according sources with Taiwan-based supply chain makers.


    Cambrios has received investments from Samsung Electronics and its ClearOhm coating material has better conductivity and lower costs than the indium tin oxide (ITO) film, the sources said.


    Sweden-based FlatFrog has several unique touchscreen technologies for large-size displays and the company's solutions have already been adopted by Wistron with related products to show up in January 2014, the sources said, adding that FlatFrog is expected to join the ultrabook supply chain in June 2014 to help lower costs.


    UniPixel's UniBoss technology offers touch solutions for bendable screens, the sources noted.
    18 Apr 2013, 07:35 PM Reply Like
  • Author’s reply » That's an interesting thought, Brian. I think that Atmel's controller group has been pursuing UniPixel for a relationship. But I think that UniPixel had been somewhat cool in their response. This could change, but I don't know anything for sure.


    I have heard from two separate sources now that Asus has indefinitely stopped working with XSense. I have no idea if this is true or not, but one source mentioned it a month or so ago, the other this week. I spoke with an Asian module manufacturer who noted that XSense has difficulties in displays greater than 12 inches. He also mentioned that Atmel is not investing in XSense production any longer. They are instead shopping the technology in Asia to license it to film manufacturers there. I would guess that means that CIT/Carclo are involved as it is their technology. Again, this is all unsubstantiated. If Atmel is beginning to downplay XSense, and disassociate its core business from the XSense technology then this might also bring Atmel and UNXL together.


    Thx again, Brian.
    19 Apr 2013, 11:41 AM Reply Like
  • "At the Cowen TMT Conference, UNXL had two working versions of UniBoss: a 10.1-inch Chi Mei Innolux display with an N-trig controller, and a 13.3-inch LG display with an Atmel controller. The 10.1-inch device was made with an air gap (no adhesive lamination to the display)."


    Interesting that ATML seems to have been qualified on Uniboss. At the same time they are still not able to qualify their CO Xsense facility, are cancelling orders, and indicated they would not even announce when/if that facility was qualified. Interesting.
    3 Jun 2013, 03:21 PM Reply Like
  • Hi GRA


    It seems that your sources about Atmel down playing XSense have been officially debunked. Atmel claimed to be the leader in metal mesh during its last conference call.


    I hope UniBoss finaly gets field tested and qualified so it can join the race.


    2 May 2013, 04:45 PM Reply Like
  • Does anyone know has Atmel acknowledged that Uniboss is a competitor to Xsense and does work well?
    2 May 2013, 05:10 PM Reply Like
  • "MaXTouch is also powering the touch in the ZTE V72 7-inch tablet and the ASUS MeMO Pad 7-inch tablet, which also features XSense in some versions. "


    Why only some versions?


    More importantly:
    "Today, our manufacturing requirements are being supplied by our partner, CIT, as we qualify our Colorado facility for large-scale production. "


    I would emphasize 'Today'. XSense can last forever. Doesn't mean they always have to use Carclo/CIT. Unless there is some clause that states that only touch modules utilizing CIT screens can be marketed as XSense? I don't know of any, but it could exist. What is to prevent XSense from using UniBoss or any other technology that is deemed superior/cheaper ?
    2 May 2013, 05:12 PM Reply Like
  • Well, from my question, has Atmel ever said anything about Uniboss as a competitor or shown any interest at all in UniPixel?
    2 May 2013, 06:39 PM Reply Like
  • I don't believe that I have ever heard Atmel mention UniBoss, but Synaptics has (and they haven't mentioned XSense for obvious reasons).


    Furthermore, Intel has mentioned Unipixel (and not Atmel), and now SID mentions UniPixel (and not Atmel):

    2 May 2013, 08:23 PM Reply Like
  • Author’s reply » We will see, Ivan. The UniBoss line is up and running, and is producing product. The line was fully qualified last month.


    Atmel has had some difficulties transitioning to production. They are a quarter behind in qualifying, and they hope to get things straightened out this month. It has been difficult for them to transition Carclo's technology which is run at small-scale, to a full-scale production environment. They have had yield issues, and they are resolving them now.


    They seem confident they will overcome those issues, and since they are very experienced in large scale semiconductor manufacturing environments, they deserve the benefit of doubt. XSense is, after all, a complex, batch, lithographic-driven, subtractive process - very much like making semiconductors.


    It helps to have lots of process expertise behind your production ramp. This is why UNXL longs are happy to have Kodak partnering to build out production. Kodak is a world leader in printing and coating films at commercial scale, and they have been instrumental in getting production qualified, tested, and running in Texas.


    Having Kodak commercialize UniBoss production was a wise choice. Not only will their expertise improve the end product, but having another multi-billion dollar company with so much expertise in the space invest large quantities of time, energy, and financial resources into this enterprise speaks to what they think it can become.


    Incidentally, I'm not convinced XSense really is as important as you think to ATML's long-term strategic plans. They are unwilling to deny that they are in discussions to license the technology to others. Since they have an exclusive license with Carclo, I'm not sure how this would work. In any case, if it's true, it would seem Atmel's direct commitment to the technology is in question.


    Big market, lots of opportunity for both Atmel and UniPixel. UniPixel has attracted a lot more investment and interest to start, but Atmel is just getting started and they will win some big business when they can get the plant running.
    3 May 2013, 08:31 AM Reply Like
  • GRA


    I think you are up to something here.
    Carclo makes the photo-sensitive film that is used to make XSense.
    It doesn't matter if it coated in Colorado or Cambridge it belongs to Carclo.
    Because the photo-sensitive can be molded using regular photo-lithography Atmel could just sell the photo-sensitive film strait to module manufacturers, because they already have the photo-lithography equipment there will be no cost in increasing capacity this way.


    I don't this means that Atmel is getting away from XSense, it is just another way to increase capacity.
    4 May 2013, 05:09 AM Reply Like
  • Actually Atmel did mention in their last earnings call that they are in "active discussions" with "ecosystem partners... to ensure that substantial capacity is available to support the forecasted rollout of large-screen systems."


    Licensing is just a way to increase capacity!!!!!
    5 May 2013, 03:22 AM Reply Like
  • GRA & Chris


    Were you to read the Atmel earnings call transcript, you would note that XSense takes up the most significant part of the discussion.
    The significance of the word 'Today' in their statement refers to the fact that Carclo are currently supplying CIT film from their existing
    UK facility, a further production facility also due this month, pending the Colorado facility coming on stream shortly. You would also note that Atmel have won several multiproduct design wins for XSense with several Tier 1 clients. The Asus Memo Pad has been around longer than Asus has been taking delivery of XSense, but the key element here is that there is XSense product out in the market now, at least 6 months ahead of Uniboss.


    My reading of Unipixel's performance to date as per their earnings call differs from your statement that they are producing fully qualified product. What I heard is that they have produced 50 units to date, a little short of the 60000 you mooted for April, and that yields started out at 20%, rising to 70%, rather than the 85% you were suggesting they had already met. Are you sure that Unipixel's one client is accepting the quality of what's being produced?
    3 May 2013, 12:27 PM Reply Like
  • UNXL only produced 50 units for April????


    They said they were going to do 60,000. Can anyone confirm this? If they are missing numbers already, this could be a great shorting opportunity.


    I have no position at the moment.
    3 May 2013, 01:43 PM Reply Like
  • Hi clifk,


    As an investor in Carclo, you can probably best answer this question: What is the agreement between Atmel and Carclo for the Colorado facility? It sounds to me like Atmel will be doing production there, not Carclo. Are they paying a licensing fee?


    On a different note, I don't believe people said they would be selling 60k units in April, just that they would have the ability to produce. Yields are currently at 70%, but expected to increase as they further improve the manufacturing systems with Kodak's help. More importantly, the plating has a 100% yield.


    UniPixel is currently in the process of getting qualified with their screens produced from the roll-to-roll. My understanding is that the batch-created screens were already qualified successfully.... but perhaps GRA can provide more information in this regard.
    3 May 2013, 01:46 PM Reply Like
  • Chris, this is the quote from Killion on the Q412 earnings call:


    "We are on target to hit 45,000 to 60,000 units or square feet per month by the end of April; 200,000 by the end of June, 700,000 by the end of September and then achieving 1.3 million units monthly by January of 2014."
    3 May 2013, 01:49 PM Reply Like
  • Adam, listen to the conference call. It's all been fully disclosed, including that they qualified thier production facility at the 60,000 units per month level. The fifty units number is the number that the OEM has built out for full durability testing.
    3 May 2013, 01:50 PM Reply Like
  • I'm not sure what your point is Adam... They said they would be at 60,000 units in capacity by the end of April, and they were. So they hit their target.
    3 May 2013, 01:54 PM Reply Like
  • My point is he said he would be PRODUCING those numbers, not just capacity.


    Here's what he said before that quote: "Looking at our manufacturing capacity roadmap, we see limited production in the second quarter and ramp up to volume production in the third quarter."
    3 May 2013, 02:01 PM Reply Like
  • that quote validates my statement.... so again, I'm confused. We are having limited production in Q2, and we do expect volume production in Q3 (possibly end of Q2) as they start shipping for the back-to-school season with products on the shelves in September time frame.


    The shipment of 50 units isn't for a customer, its for testing. Assuming that everything goes as expected, then they start producing for the customer in "volume production"
    3 May 2013, 02:07 PM Reply Like
  • I'm not saying anything confusing I don't think. Did UniPixel produce 45,000 to 60,000 units by the end of April like Killion said they would?
    3 May 2013, 02:12 PM Reply Like
  • Adam, you're mincing words. Killion never said they would be producing 45-60k units by the end of April. Lets put the whole phrase together:


    "Looking at our manufacturing capacity roadmap, we see limited production in the second quarter and ramp up to volume production in the third quarter. We are on target to hit 45,000 to 60,000 units or square feet per month by the end of April; 200,000 by the end of June, 700,000 by the end of September and then achieving 1.3 million units monthly by January of 2014."


    Now, lets simplify it: "Looking at our manufacturing capacity roadmap....We are on target to hit 45,000 to 60,000 units...."


    They hit their target, which is better than we can say about Atmel, which has been having a few (possibly minor) delays qualifying its new manufacturing facility.
    3 May 2013, 02:17 PM Reply Like
  • Author’s reply » Clif, you've misread our comments somewhere along the line. We didn't deny that XSense is being produced by Carclo. We pointed out that Atmel has had difficulties qualifying the process in its fab.


    You can go read UniPixel's statements and I think you will find confirmation that they have qualified UniBoss production. You will also find that they achieved a production capacity rate of 60k units/mo by the end of April. I don't recall ever suggesting that production yields had ever reached 85%. How could anyone have suggested this when the company wasn't even producing prior to the end of April?


    The global PC OEM has worked closely with UniPixel to qualify the manufacturing operation and to validate the quality of the product. The PC OEM is anxious to move this process forward quickly.
    3 May 2013, 02:30 PM Reply Like
  • From the conference call they didn't say exactly they only said this:
    Please see my latest insta-blog Adam


    "50 moving to hundreds and thousands over the next several months."
    4 May 2013, 02:37 AM Reply Like
  • Adam-


    Why on earth would Unipixel produce 60k units of a product that has not been qualified by the ODM? You only need 10s of units in order for an ODM to build prototype units for testing (technical, environmental, FCC, durability, etc.). What would an ODM do with 60k units of Uniboss prior to the technology/product being fully tested. You think you're being clever by asking how 50 units supplied squares with capacity for 60k units but it reveals an ignorance on your part about how technology supply chains work as it pertains to new suppliers/technologies and designs.
    6 May 2013, 10:01 PM Reply Like
  • I was making the point that UNXL is behind schedule. Why hasn't the technology been tested by now? It has been five months since the deal with the ODM was announced.
    7 May 2013, 09:09 AM Reply Like
  • They have done extensive testing for months prior and post Dec7 agreement. But the difference has been testing of small-batch UniBoss production previously (proof of technology), and now testing is on product from the full-scale production roll-to-roll process in Lufkin (proof of production). In my industry (far different), we do testing at several levels of development and always follow up with the full-production version being fully vetted - for a new supplier with new technology, that bar for testing is much higher. Why would you expect less from the PC OEM? They would be silly to do otherwise, especially for a new technology and new supplier.
    7 May 2013, 09:20 AM Reply Like
  • Author’s reply » Adam, it's fine to be skeptical but you need to do some homework if you want your skepticism to count for something. UniPixel has stated publicly that the product has been tested by its partner in the past. They've also spoken about the fact that their partners have done extensive audits on both the UniBoss product and its manufacturing process. Some of these partners have spent in excess of six months getting familiar with UniBoss.


    Now they've shipped their first product off a production line and it is going into machines for further testing. These will be strenuous tests, as Bob mentioned on the call, however, unlike in previous tests, the sensors will now be encased in a laminated display which will offer the sensors some protection.


    There's no guarantee that UniBoss passes these tests, but I'm optimistic knowing that the product was previously put through a battery of tests as a stand-alone sensor.


    I'm also optimistic because metal mesh sensors are starting to hit the shelves at your local Best Buy. This is a real technology with a real big market opportunity.
    7 May 2013, 09:32 AM Reply Like
  • And what is your point, that they didn't ramp up production AHEAD of what they had planned?


    RK specifically spells out the capacity roadmap at the levels you mentioned and on 4/30 said they hit that 60k target in April and are on track to hit the future targets. And he also specifically says 'limited production in the second quarter'. The last I looked, April - June is the second quarter. Where does he say he would be producing at high levels in the second quarter? As you noted RK specifically said "limited production in the second quarter".


    Don't try to create a conflict where one doesn't exist. You do understand what the words 'capacity' and 'product' mean, I presume.
    3 May 2013, 02:12 PM Reply Like
  • OK, then you tell me then. How many units do you expect Unipixel to PRODUCE. I'm not talking about able to produce, but actually creates the tangible product. How many units will Unipixel produce in the next couple months?
    3 May 2013, 02:26 PM Reply Like
  • Their guidance is 'limited production in the second quarter'. The next couple months are still the second quarter.


    As you noted they told us this in Q412 conf call .. why are you suprised in Q213 that production capacity is there, as promised, but production is limited as promised?
    3 May 2013, 02:31 PM Reply Like
  • I obviously don't know exactly so I could be way off in my estimates. However, I assume that starting in either June or July they will be producing maybe 50-100k per month for the rest of the year. This could swing quite a bit based on the cyclicality of products (back to school and holidays are bigger than other months).


    Then, in 2014 I expect production to explode higher. I believe that 2013 will just be to "Dell" for a few 'test' SKUs. In 2014 "Dell" will increase their business and also some customers through "intel" will start coming in.


    Finally, if the first "Dell" products go well, it is possible that "Dell" will order significantly more than 100k/mo for the holiday 2013 season. I expect just "Dell" to be in the 500-800k/mo area for 2014, maybe more.
    3 May 2013, 02:32 PM Reply Like
  • Author’s reply » Adam, I don't think the company will actually be in production until the very end of the quarter. My model calls for just a couple thousand units.


    The building and testing of prototypes will take time, then we'll get some pilot orders, and then pre-production orders. I don't think the company is paid on a per unit basis for those products. An official production PO may not come until the very end of the quarter. Who knows, it might even be July.
    3 May 2013, 02:44 PM Reply Like
  • OK, thanks Chris. I'm indifferent as I said I don't have a position, but I'm always looking for opportunities on the long or short side.
    3 May 2013, 02:47 PM Reply Like
  • ok, thanks.
    3 May 2013, 03:00 PM Reply Like
  • Chris,


    Ref Atmel/CIT, I understand that CIT receive royalties if Atmel produce the sensors, or product payments if Carclo do.


    Regarding capacity v production, I don't mean to embarrass you but to point out the Unipixel stated position from a quote from your article on Unipixel being the best investment for 2013..


    Unipixel is in discussions with many other companies as well for more design wins, and I believe it is safe to assume they will receive another 1-3 wins per quarter in 2013. But what does all of this mean for profits? Two days before the announcement with their first purchaser (possibly Dell), the company announced in an analyst call that they expect to produce 60,000 units/month by the end of Q1 2013, 175,000 units/month by the end of Q2, 700,000 units/month by the end of Q3, and 1.3 million units/month by the end of 2013. They have a preferred pricing program at $20 per unit, and expect to have "greater than 50% margins" on this preferred pricing.


    So U were indicating production, not just capacity. Given the yield
    issues I can understand slippage, but it would be incorrect to say that capacity was the original target. What I understand less is that
    yields were supposed to be at 85%, but in the call RK admitted to
    20% going to 70% where it currently sits.
    3 May 2013, 06:48 PM Reply Like
  • Author’s reply » The company has clearly stated that these were capacity targets.


    I cannot speak for Chris, but I'm guessing that "production" was shorthand for "production capacity" in his note.


    If you were thrown off by this, Clif, I think you were one of the few. Witness the fact that not a single Street model called for 1Q sales at a rate implying that 60k units/mo were being produced for sale.
    4 May 2013, 08:26 AM Reply Like
  • Yes, it should have read "expect to be able to produce" (i.e. have capacity for). You can consider this short hand. Or a small error.


    Either way, it really doesn't change the long-term story. Furthermore... you can't judge UNXL for "slippage" based on what I say... it is based on what they say. UNXL has been much clearer than I that these are capacity targets.
    4 May 2013, 10:47 AM Reply Like
  • GRA/Chris


    Reference yields, the 85% figure came from Chris in a debate over quality between us ....


    I agree that xSense is marginally thinner, which is marginally better. But Unipixel has great yields (not sure how they compare to CIT). >85% printing, 100% plating. That is very high so I don't expect any issues down the road. Unipixel is in fact production ready, as is evident by the receipt of the $5M from "Dell".
    3 May 2013, 07:24 PM Reply Like
  • Author’s reply » Clif,
    Chris is speaking to yields on test runs, not production runs.


    So what? UniPixel is just beginning production and yields will improve. I'm guessing that Atmel is in a similar position based on what they're saying. Hopefully they'll both be producing vast quantities by year end. Neither Atmel nor Kodak/Unxl will be able to meet demand for a long time.
    4 May 2013, 08:37 AM Reply Like
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