The microLED market is still alive after Apple's exit

Had Apple opted to exit the microLED market two years earlier, it might have been the death knell of the industry, but a Yole Research analyst who has his pulse on the technology is cautiously optimistic despite the tech giant’s recent pivot.

In an interview with Fierce Electronics, Eric Virey, principal analyst covering displays at Yole, said after investing an estimated $3 billion into microLED development and convincing Osram to spend $1.3 billion of its own money to build a fab so Apple could make its smartwatch, Apple pulled the plug and cancelled the project.

“That's big news, especially in the context of the microLED industry, which you could argue was created by Apple,” he said.

Prior to Apple taking an interest in microLEDs, the technology was barely on anyone’s radar, Virey said. Apple spent $450 million in 2014 to acquire a startup, which for it wasn’t a lot of money, but for everyone else it was a significant amount of money and put microLEDs on the map. “Then it started getting more and more momentum.”

The growth of the microLED market became a self-fulfilling prophecy, Virey said. “Everybody’s looking at their neighbor.” Even with other large players such as Samsung and LG participating in the microLED industry, as well as a whole host of startups, it’s a challenging technology, he said.

But the fundamental science is not what’s holding microLEDs back, Virey said. Rather, it’s a gigantic manufacturing challenge – how do you scale microLED technology so the cost per unit isn’t exorbitant? “It was making progress,” he said. “Not as fast as people would have wanted.”

MicroLEDs are ever emerging

MicroLED technology has been three years away from happening – for many years now. But like 3D NAND flash memory and Intel Optane, microLEDs have struggled with scaling. Virey said it appears that Apple couldn’t get the yields right.

The cost of microLEDs remains high and the technology has struggled to compete with organic LEDs (OLEDs), he said, which keep improving while getting cheaper and lasting longer. It’s possible that Apple when the wrong route when it came to developing the technology. “Maybe their design was over engineered,” Virey said. “Maybe it was expensive by design.”

That’s why there remains room for optimism, he said, because it’s still possible that are paths to profitably making microLEDs – just because Apple couldn’t do it, doesn’t mean it’s not possible.

There are a lot of different players in the microLED segment working on different pieces of the puzzle, Virey said.

One those companies is VueReal, which doesn’t consider itself a pure microLED company, CEO Reza Chaji told Fierce Electronics in an interview. “We consider ourselves a micro printing company,” he said. “We want to enable the integration of different micro semiconductor devices.”

This means that as Apple pulls out of the microLED market, VueReal doesn’t have all its eggs in one basket, but it is still bullish the technology going forward.

Turnkey solutions simplify manufacturing

VueReal’s MicroSolid printing platform uses a new micropixel fabrication process that removes the complexity of working with micropixel technologies. It’s a turnkey approach for customers, Chaji said, and it’s not limited to microLEDs alone. “Our cartridge is device agnostic,” he said. “We can use different devices and the way we are implementing it now is also technology agnostic.”

Chaji said being technology agnostic was an intentional choice. “We wanted to be able to allow any device or any technology to be integrated and create functionality out of it.” This places VueReal between companies that have unique devices and the companies who want to develop different applications, he said.

MicroLEDs remain one of the most immediate markets for the company, he said, and there’s lot of interest in VueReal’s platform because of the many potential applications for microLEDs. “The microLED itself has a lot of advantages that I don't think any individual company will let it go forever,” Chaji said. “They may change their plan.”

Chaji’s background is in display technology and his PhD work involved biosensor technology that was later licensed to LG.

He said VueReal’s microprinting solution is future proof, which will help address the scalability challenges faced by microLEDs.

Chaji said the company sees three key markets that would benefit from early adoption of microLED, with automotive being at the top of the list. The technology is also considered critical to making appealing headsets for augmented reality / virtual reality (AR/VR), he said.

VueReal has advantage over other companies looking to scale up microLEDs because it’s tackling the problem from a different perspective other than lasers, Chaji said. The company is well positioned to take advantage of market opportunities that don’t yet exist today because its platform is future proof and can be optimized for different products with a turnkey approach, he said.

MicroLED players have different roles

Yole’s Virey said VueReal is an example of one of the prominent and visible startups in the microLED space since the early days. He sees the company with its mass transfer process as a technology provider – it’s not going to be the one investing $5 billion to build a fab to make the full display. “They're developing key technology pieces.”

Companies like NS Nanotech, meanwhile, are focused on making LEDs more efficient, which Virey said has been a major challenge because the smaller you make microLEDs, the less efficient they are, and to make them cost effective, they need to be made as small as possible. Otherwise, he said, the primary appeal of the microLED, which is being more energy efficient than OLEDs, is lost.

Virey echoes Chaji’s sentiment that AR / VR glasses are key target application for microLEDs – no one wants to be wearing something bulky while walking down the street. And even though Apple is abandoning its microLED development, smartwatches remain another key product, he said, especially as Apple’s exit means it’s no longer viewed as a captive market.

Apple will ultimately go with the technology that best fits its needs, Virey added, which could ultimately be microLED technology from another company.

Virey said it’s too early to tell if other big players are going to continue to try to make microLEDs happen or give up as Apple did. “We need to wait for the dust to settle to see what happens.”

Two years ago, Apple’s exit would have killed the microLED industry, Virey said, but it has gained a lot of momentum that he believes it survive the blow. “There will be some changes,” he said. “The short-term focus might not be a high-volume consumer product like a smartwatch.”

Virey said there are companies that have made microLED technology a key component of their strategy. “With Apple gone, it might open up the space a little bit for other people to take the lead and become the new champion for this industry,” he said. “It's not going to be easy, but it might still happen, although on a different timeline and in a d different fashion.”