LEDs have radically changed the world of lighting, moving us from low efficiency incandescent filament illumination to high efficiency solid state illumination, and a quick look at a few statistics shows how important LED lighting is toward reducing the global energy footprint.  However, aside from the very compelling metrics, there are some issues with LEDs that make them rather difficult to work with in certain situations.  While incandescent lighting tends to be ‘warm’ that is having a color temperature of between 2,000K and 3,000K, while CFLs tend to be ‘cooler’, meaning less yellow and more blue, while LEDs can vary considerably between warm and cold depending on their structure.  This can be confusing for consumers who are not used to choosing a color for their home lighting.
While color temperature can be an issue, more difficult is the fact that LEDs are point source emitters, and while they are very efficient at converting energy to light, that light is concentrated in a very small space.  Most LED bulbs are coated with materials that help to disperse that light, but it is difficult to diffuse LED light when compared to incandescent lighting.  When LED lighting is used in some specific applications, such as a museum or in store product lighting, the LED bulb must focus the light to the specific area being highlighted, which in many cases means an optical lens must be added or am LED bulb specifically designed for that application is necessary.
Japan Display (6740.JP), a company known for its small panel LED displays, has developed a new product through a subsidiary that uses the capabilities of LCDs to make LED lighting adjustable to a user’s needs.  Typically LED lighting with an optical lens creates a circular ‘spot’ that can be adjusted by moving the source closer or further from the object, which is not always a viable solution.  The brightness and color are adjustable, but shaping the ‘spot’ is not an option without changing the optics, which means small run LED production tends to produce expensive product.  Japan Display promises to end that issue by replacing the optics with a lens composed of liquid crystal, the same material used in all LCD displays.
While we do not know the details quite yet, the liquid crystal is used to change the refractive index of the LED light, which allows it to be shaped on both the horizontal and vertical axes.  This means that a user can adjust the shape of the LED light on the fly.  This can be done using a touch screen control or similar device, giving the user complete control over the shape of the light, meaning one could expand the light to its maximum coverage or create a spot of almost any shape to highlight an object or read.
Of course, JDI has projections as to how the creation of a new industry in 2023/24 will generate ~$67m in incremental sales by 3Q 2026, after sampling to potential customers this month and scheduling mass production for April of 2023, but until we see a cost analysis of the product, we reserve judgement on the financial aspects of the product.  That said, there are few new applications being generated for the LCD space, and any new application adds to the potential lifetime of LCD technology which is under siege from a variety of alternative display technologies.  While this application is specific to Japan Display (there are many companies that produce static optical lenses for LED lighting) and has yet to be commercialized by JDI or its customers, it is a novel approach to one of the drawbacks of LED lighting and credit should be given for working with the company’s strong suit in small LCD technology.
Here are 46s second and 27 second videos that show how the product functions:
https://youtu.be/1nq1GF_Bq94
https://youtu.be/dQFtiShMtQE
 
 

Streetlights are ubiquitous, with close to 30m in the US alone and an estimated ~325m across the globe, and while some have been converted to energy saving LEDs and an even smaller percentage have begun to include other services such as cameras for traffic or pedestrian control, they consume considerable energy, space and maintenance, while doing little other than providing a safer walking or driving corridor.  We have noted previously that 5G base stations or repeaters can be installed on such poles, giving carriers a less expensive way to deploy the higher base station count needed for 5G and giving municipalities a potential offset to the cost of powering and maintaining those poles.
Most modern light poles include a photocell sensor to automate the lighting which goes toward reducing cost, but despite the massive number of light poles and their concentration in populated areas, they remain low function devices.  What makes light poles a focus for additional services is the fact that they are all powered, giving add-ons the ability to use that power without the additional cost of running additional power to other external devices, as has been the case for video cameras and similar devices, but it seems one new company is interested in bundling lots of stuff into a relatively small package that is easily installed on existing light poles.
Ubicquia (pvt), a Florida-based start-up has bundled a variety of devices into a single package that attaches to existing streetlights in minutes, giving each the ability to provide Wi-Fi, Directional Microphones, Dual 4K Cameras with 16 days of video storage, and an 8 core AI processor, and a PoE (Power over Ethernet) port for additional applications.  The Wi-Fi 6 access point can be used to provide access to the public or city employees and can be meshed by using a backhaul connection, while the cameras can stream traffic and pedestrian images with the microphones used to gather noise levels, speeding cars, or gunshot noise through the company’s platform management system, which controls all functions and data.  As the platform itself installs through the light pole photocell input, the cost of installation relative to adding individual devices or a dedicated pole is said to be 40% lower (unconfirmed), with compatibility (again unconfirmed) with 360m streetlights.
While street poles have always been financial burdens to towns and cities, increasingly so as cameras become more a part of daily life, the need for carriers to deploy additional base stations for 5G and eventually for 6G give new life to street poles, and will allow governments to provide additional services , partially funded by carriers.  The cost of adding such services through modular systems such as the one described above make it worthwhile and cost effective for adding those services which can benefit the public in numerous ways, particularly by reducing traffic and preventing or solving crime.  While there will always be questions of personal security, light poles and cameras are already so enmeshed into society that unless they are used for quasi-legal purposes, they seem to be accepted by the general population, and as less of a cost burden local governments can expand their use without a heavy cost.

​Note: SCMR LLC is in no way associated, has investments in, or receives any compensation from companies mentioned herein, and while we might speak to management about the company or products, we make decisions about the content of our notes based on our desire to present informational and interesting topics and commentary on consumer electronics, companies, and products.

Silver tooth filings are either a sign of poor dental health or street cred, but those filings have between 22% and 32% silver, mixed with tin, and zinc, with the largest component being mercury (~50%).  But wait, isn’t mercury dangerous and absorbed through the skin and haven’t there been concerns about eating tuna because it contains high levels of toxic mercury? The answer is yes and the use of mercury has been regulated since 2013 and its use restricted in a variety of consumer products.  Mercury batteries, once used in walkie-talkies and transistor radios, are gone due to concerns over mercury leaking into the environment and while that silver amalgam is still used in dentistry mercury is considered a highly toxic substance and has been removed from almost all consumer products except one big one, fluorescent lights.
Mercury vapor fills those endless rows of lighting tubes that are the stalwart of grocery, big box retail, and warehouse lighting, as they are between 3 and 5 times more efficient at producing light as incandescent light bulbs, and cheap hotels still have those ugly compact fluorescent bulbs in bathrooms because they lowered operating costs, but soon that will all be a thing of the past, at least in Vermont, as a new law passed this month makes it the first state to phase out the sale of linear fluorescent lighting in favor of LEDs, with Rhode Island and California to follow.
Based on an 80 page report by the American Council for an Energy Efficient Economy, a non-profit research group that develops policy and standards on energy waste and climate change for appliances, equipment, and lighting, Vermont has decided that starting on January 1, 2024, the sale of those mercury-based fluorescent tubes will be prohibited, particularly the 4 foot types that are the most common.  Earlier legislation passed in 2011 mandated that lighting manufacturers must arrange for the collection of expired/used fluorescent lamps at various sites and safely dispose of them, although we expect many never make it to such collection sites.  That law contained a provision that said the bulbs should be banned completely once a superior alternative was found and various groups petitioned the Vermont Department of Conservation citing LED based tubes as an alternative.
The study provided the table below as a comparison between fluorescent and LED T8 bulbs:

​[1] Lumens/watt

A full transition from fluorescent lamps to LEDs would provide large mercury and CO2 emissions reductions according to the study, which stated that by 2050 the ban would:

• Reduce the amount of mercury shipped in lamps by 16,000 lbs.
• Reduce Carbon Dioxide emissions by 18 million tons, which is equal to the annual emissions of 4 million typical passenger cars.
• A typical school with 980 fluorescent lights would save about $3,700/year in electricity cost by switching to LEDs, which would amount to over $24,000 over the expected life of the replacements.
• A full transition to LEDs would yield $44 billion in national NPV savings.

However as the EU has already eliminated all general purpose fluorescent lighting exemptions for RoHS rules, which will phase them out by next year, there are concerns that the US will become a dumping ground for fluorescents that have been eliminated or restricted in other countries unless other states join Vermont in passing such legislation or there is a federal mandate.  There have been industry associations that have lobbied against the ban  citing cost  and availability, but it is a hard case to make when considering the toxicity of mercury and the energy savings, especially after the heat wave that much of the US has been experiencing recently.

Way back in September 2019 we noted that CREE (WOLF), now known as Wolfspeed, was planning the constructing what it says is the world’s largest SiC (Silicon Carbide) production facility in Marcy, NY.  The project, which was expected to cost $1.5b (Empire State Development Fund to contribute $500m) was to be built outside of Utica on the “Marcy Nanocenter”, which is a 450 acre site close to SUNY Polytechnic Institute, considered ‘the largest shovel-ready semiconductor site in the world’ by whoever wrote the copy for the Nanocenter.  The development and construction program of the site was expected to take eight years during which CREE/Wolfspeed was to avail itself of space at the SUNY campus in Albany, using equipment that is part of the NY Power Electronics Consortium.   
About a year later we noted that CREE had decided to sell its LED products business to Smart Global Holdings (SGH) after having sold its lighting products division to Ideal Industries (pvt) in May of 2019.  It seems that Wolfspeed has completed and opened its massive 200mm SiC fab as of the end of last month.  We expect that given the initial eight year project timeline additional capacity will be added over time, but the project, which is expected to generate 600 new jobs in the region during the first 8 years of operation, has begun to run wafers and the company has signed an agreement with Lucid Motors (LCID), whose Lucid Air is said to be able to travel an EPA estimated 500+ miles on a single charge.  The new Wolfspeed fab will be providing SiC power modules to Lucid under the multi-year agreement.

Ennostar (3714.TT), the parent company of Epistar (pvt), the top LED chip producer in Taiwan and sister packaging company Lextar (pvt), reported 1Q results NT$ 8.45b ($283.67m US), down 13.3% q/q but up 24.2% y/y.   The consolidated company generated $13.3m in cash in 1Q, after CAPEX of $31.3m and $33.68m in cash in 4Q after $34.1m in CAPEX.  While we don’t often show results for LED manufacturers, Epistar indicated that May results would be affected by Chinese COVID lockdowns, although they expected to see results return to normal in June.  As Epistar is a major Mini-LED supplier to Apple (AAPL), this represents one more datapoint toward understanding how the Chinese lockdowns are affecting major CE companies.   Figure 1 shows the combined sales of both Epistar and Lextar, which have been on a positive trajectory since last year, but look to be leveling off so far this year. 

Exposure to the IT (Monitors and Notebooks) and smartphone backlight category has grown almost 3x since last year in terms of sales contribution, which makes the company quite sensitive to demand weakness and pricing pressure for smartphones and IT products, hence the warning about said impact in May.  However the company continues to expand its capacity, most recently at Lextar where new lines dedicated to Mini-LED backlight production have been installed, but more telling is Ennostar’s decision to increase the company’s overall 2022 CAPEX budget by 45.5% from $184.5m to $268.4m this year, a hint that despite the short-term issues they currently face in 2Q, they remain positive about their Mini-LED backlight business overall, which has to reflect at least a bit on the company’s relationship with Apple.  

​Mini-LED backlights give longevity to LCD displays in that they allow LCD technology to better compete with OLED displays.  While Mini-LED technology is an outgrowth of conventional LED backlight technology, by making LEDs smaller and squeezing more into a display, the contrast of an LCD display can be improved while reducing fast motion artifacts (smear or trails) and halos.  Given the vast investments made in LCD production capacity over the last 15+ years, any technology that can extend the life of those assets is one championed by panel producers.  From a CE brand perspective the higher price of OLED displays on a m2 basis, keeps some mid-to lower price point products out of the OLED display sphere and focused on less expensive LCD display panels, but at the same time those products must compete with OLED and other emerging display technologies to stay relevant. 
Mini-LED backlights do just that by improving LCD display specifications, especially when paired with quantum dots, so aside from the enthusiasm for Mini-LEDs from LED producers, brand interest in Mini-LEDs is increasing as the supply chain for Mini-LED components and modules expands.  LED producers are happy to see a path toward a more upscale market, especially as generic LED production processes are relatively easily scaled to Mini-LEDs, and brands see this as another level of differentiation and premium pricing.  Samsung Electronics (005930.KS), LG Electronics (066570.KS), TCL (000100.CH), Sony (SNE), and Hisense (600060.CH) have all adopted the technology for their TV lines, and Apple (AAPL) has been using Mini-LEDs for a number of products, from the Apple Watch to the MacBook line and in the company’s XDR Monitor.
It is not secret that Apple has been working with a number of partners toward the continuing development of Mini-LED technology, but also with a bent toward developing Micro-LED displays, which are both a major step forward in display technology and one that would eventually compete with OLED and even LCD itself.  That said, Apple continues to work with partner Epistar (3714.TT) toward further development of Mini-LEDs and is supplied by Epistar, OSRAM (AMS.SW) and Sanan (600703.CH) from their products.  Sanan seems to have had some issues (IP) that have made product qualification more difficult, however Epistar has been both a development partner and LED supplier to Apple for a number of years.
To that end, Epistar is expanding its Mini-LED capacity in Taiwan and China, although speculation on the extent of that expansion seems to be somewhat unreliable. Late last year expectations were that Epistar would be expanding capacity by 50% in 2022, and while that seemed a bit optimistic, we noted last year that Epistar was seeing strong demand starting in 2Q, roughly the same time Apple was beginning volume production for the MacBook Pro.  The company did add Mini-LED production capacity late last year, so some of the 50% increase expected for this year might have been pulled forward, but we note that Epistar is at least going forward with capacity expansion plans this year of 25%, from ~15m in2 to ~18.8m in2, or 1.2m 4” equivalents to 1.5m. 
While it cannot be assumed that all of the new Epistar capacity will be allocated to Apple, we expect they have communicated longer-term plans and Epistar has responded.  All in, the expansion likely signals Apple’s continuing ‘investment’ in Mini-LED technology and the potential for new Mini-LED products, and solidifies some of the speculation as to additional products either this year or next.  While this says nothing as to Apple’s feel toward other display technologies, as each product category has its particular needs and specifications, it does give the Mini-LED supply chain a ‘warm’ feeling knowing that Apple, Samsung, LG, and TCL are all expanding the use of Mini-LEDs, and while suppliers are more will to take capacity risk, Epistar’s expansion seems to point the Mini-LED industry in the right direction.

​On 02/07/22 we noted that China’s BOE (200725.CH) was the responsible party for the massive LED display that served as the opening venue for the Winter Olympics.  While we were correct to a degree, it turns out that BOE was not the only party involved in the development and construction of the display, and the other primary supplier, China’s Leyard (300296.CH) took umbrage at the assumption we, and many other made that BOE was totally responsible for the LED displays, likely given the massive BOE promotion signs placed around the stadium.

As it turns out Leyard was responsible for 7,000 m2 of the 11,500 m2 stadium floor display (yellow portion in Figure 1), while BOE was responsible for 4,500 m2 (gray semicircles), and Leyard was 100% responsible for the 700m2 ‘ice cube’, 1200 m2 ‘ice waterfall’, and the two North and South Standing screens, for ~70% of the venue’s primary display area, and also provided the broadcast control system.  As previously noted both companies worked under the China Aerospace Corporation (state).  

Earlier this week we mentioned the BOE (200725.CH) LED display that was the basis for much of the Winter Olympics Opening Ceremony, considered the largest in the world (uncertified as of yet), although Guinness certifies the display at Resorts World in Las Vegas as the largest, but there is contention in the world of massive LED displays, as Samsung Electronics (005930.KS) claims that its “Infinity Screen” at SoFi Stadium is “the largest videoboard ever created in sports” and is the only dual-sided, center-hung videoboard.  The Samsung display, which hangs 122 feet above the field, is 70,000 ft2, which is smaller than the abovementioned displays, but is certainly unique in shape and is 1.2 times longer and 1.5 times wider than the field itself and weighs 2.2m pounds. 
The oval display has 4K resolution and HDR10+, with pixels spaced 8mm (0.31 in.) apart, and works with the 2,600 other large format displays and ribbon boards positioned around the stadium, but what good is video without sound, so Samsung has placed 260 “JBL by Harman” speakers in the display frame, which it claims is equal to 1,500 home theater systems.  Of course, JBL (pvt) is owned by Harman (pvt) who was purchased by Samsung in 2017.
All in, there seems to be no end to the expansion of LED video walls across the globe and the competition for ‘largest’ will continue as LED modules become less expensive and more sophisticated, along with the control systems and software needed to bring them to life.  Years from now these displays will likely look a bit simple as LED technology moves to smaller die and micro-LEDs, but it sure looks different than 120 years ago (see below) when the best you had was lots of light bulbs and a guy whose job it was to replace the ones that burned out each day.
https://news.samsung.com/us/game-on-how-infinity-screen-samsung-will-bring-sundays-big-game-life/

If you saw the opening ceremony for the Olympic Games in Beijing, you saw what is the world’s largest LED display, and the platform on which the ceremonies were held and from which most of the lighting and images emanated.  The platform, which is 10,552 m2 or 113,587 ft2, was built from 42,000 LED modules that were developed by BOE (200725.CH), China’s largest display producer, and the China Academy of Launch Vehicle Technology (state), a state-owned subsidiary of China Aerospace Science & Technology Corp. (state), who prided the protective layers that allowed for water and ice to cover the displays.  To put the size in perspective, a standard football field is 67.7% of the size of the Olympics’ display.
According to Guinness, the largest LED display is the 7,500 m2 (80,729 ft2) display at The Palace, in Beijing, although we believe the display at Resorts World in Las Vegas was actually the largest at 100,000 ft2, but in any case, the display at the Olympics is larger than either.  While the specifications we have seen for the display show that the display has a refresh rate of 3,840 Hz, far above the 240 Hz (360Hz in one) seen in high-end gaming monitors and likely necessary to keep the accumulated lag across the display from becoming noticeable.  According to the same data, the resolution of the display is stated to be 29,800 x 15,096, but we take that with a grain of salt as to whether that number is for an individual module or the overall display.   All in, the display was extremely effective and coordinated with both a secondary vertical screen and the ‘light-sabre’-like hand-held devices that created some of the more spectacular effects during the ceremony.  For those that missed it, here are highlights from NBC Sports.
https://youtu.be/E3cLX07PD8c
​

​Genesis Photonics (3383.TT), a supplier of LED products including flip-chip and specialty LEDs, has sued Apple (AAPL) in the Taiwan courts for infringing 9 of the company’s patents concerning LED packaging, including mini-LED packaging and mini-LED backlight modules.  The Apple products that the Genesis suit is focused on are the iPad Pro, the iPad Pro Mini and related products, with the suit requesting that all infringement cease and the firm be compensated for the infringement.  The documents specify compensation of $7.55m, which is the minimum necessary for the filing, with the actual amount to be refiled after the number of infringing products is determined.  Genesis expects to file similar documents in other countries.