Why is this Micro-LED Acquisition Different from All other Micro-LED Acquisitions?
Quantum Dots are a very significant display technology, are at the core of large panel displays and TV sets developed by the world’s largest manufacturers and California based Nanosys (pvt.) is the leader in the space, providing QD materials and IP to the industry. So why would such a company buy a Swedish company, Glo AB (pvt) a VC backed developer of micro-LEDs, a technology that some say will obviate the need for quantum dots in the future? In order to understand why this acquisition makes sense and why it is significant to the display and CE space, it is necessary to understand some of the basic technology that surround both companies.
First, Nanosys is a pioneer in commercializing the use of quantum dots as materials that act as color shifters, converting light of one color into another. In typical usage the quantum dots are incorporated in a film (QDEF or Quantum Dot Enhancement Film) that replaces the diffuser, a translucent sheet that sits between the LED backlight and the liquid crystal, and spreads the light evenly across an LCD display. These embedded quantum dots, particularly ones that generate red and green light, are ‘stimulated’ by the blue light of the LED backlight and give off their respective colors, and when you mix red, green, and blue light, it turns white. This is important as the color purity of non-QD LCD systems is considerably lower than its competitor, OLED, a factor that limits the longer-term viability of LCD technology. However, not only do the quantum dots take a single color blue light and convert it to a white light, but are very precise in how they actually convert the light, giving LCD displays a shot at competing with self-emissive displays such as OLED that have a high level of color purity. Sustaining the life of the massive LCD infrastructure that the industry has built and paid for is of utmost importance to all LCD producers and underlies their adoption of quantum dots.
First, Nanosys is a pioneer in commercializing the use of quantum dots as materials that act as color shifters, converting light of one color into another. In typical usage the quantum dots are incorporated in a film (QDEF or Quantum Dot Enhancement Film) that replaces the diffuser, a translucent sheet that sits between the LED backlight and the liquid crystal, and spreads the light evenly across an LCD display. These embedded quantum dots, particularly ones that generate red and green light, are ‘stimulated’ by the blue light of the LED backlight and give off their respective colors, and when you mix red, green, and blue light, it turns white. This is important as the color purity of non-QD LCD systems is considerably lower than its competitor, OLED, a factor that limits the longer-term viability of LCD technology. However, not only do the quantum dots take a single color blue light and convert it to a white light, but are very precise in how they actually convert the light, giving LCD displays a shot at competing with self-emissive displays such as OLED that have a high level of color purity. Sustaining the life of the massive LCD infrastructure that the industry has built and paid for is of utmost importance to all LCD producers and underlies their adoption of quantum dots.
QDEF in the LCD stack - Source: American Optronics
As quantum dot materials become more commonplace, their role changes. In some cases they can be used to replace the colored phosphors in LCD or WOLED color filters, which are sheets of red, green, and blue dots that create full color images out of the white dots of an LCD display. By replacing the phosphors with quantum dots, the color purity can again be enhanced, but the ultimate goal for quantum dots is to be self-emissive. That is, to directly generate color by electrical stimulation rather than by converting other light into another color. Similar to the way in which OLED materials are stimulated, quantum dots could provide an alternative to OLED materials that require a rather complex production process, but using quantum dots commercially as self-emissive emitters is still a few years away, and in the interim quantum dot companies like Nanosys are looking for better ways to help a vast LCD infrastructure compete against new technologies.
Color Filter Structure - Source: Topwaydisplay.com
One of those competitive new technologies are micro-LEDs, essentially very small LEDs that would become the red, green, and blue sub-pixels of such displays. As LED production technology (MOCVD) is well commercialized, it seems a logical progression that would not require building an entire new display infrastructure, something that would take many years, but there are some issues that surround micro-LEDs, and that is where the acquisition of Glo AB begins to make sense for Nanosys.
LEDs are produced on wafers, typically made of sapphire, silicon, or compound semiconductor materials, and are formed by depositing materials on that wafer primarily through the use of MOCVD (Metal Oxide Chemical Vapor Deposition) tools that vaporize the materials and deposit them on the substrate. The LEDs themselves are stacks of materials with a space between them called a quantum well, where electrical energy is converted to light. Once the LEDs are produced they are removed from the wafer and placed on what becomes the display substrate. But all LEDs are not made of the same material, with green and blue LEDs based on InGaN (Indium Gallium Nitride) while red LEDs are based on AlGaInP (Aluminum Gallium Indium Phosphide), which means they must be produced on separate wafers and then transferred to the display substrate, creating a pixel made up of red, green, and blue LEDs. Of course, if they were all made of the same material, and therefore could be produced simultaneously on one wafer, the process would be far simpler and less costly and time consuming, particularly as LED sizes go from normal to mini to micro.
LEDs are produced on wafers, typically made of sapphire, silicon, or compound semiconductor materials, and are formed by depositing materials on that wafer primarily through the use of MOCVD (Metal Oxide Chemical Vapor Deposition) tools that vaporize the materials and deposit them on the substrate. The LEDs themselves are stacks of materials with a space between them called a quantum well, where electrical energy is converted to light. Once the LEDs are produced they are removed from the wafer and placed on what becomes the display substrate. But all LEDs are not made of the same material, with green and blue LEDs based on InGaN (Indium Gallium Nitride) while red LEDs are based on AlGaInP (Aluminum Gallium Indium Phosphide), which means they must be produced on separate wafers and then transferred to the display substrate, creating a pixel made up of red, green, and blue LEDs. Of course, if they were all made of the same material, and therefore could be produced simultaneously on one wafer, the process would be far simpler and less costly and time consuming, particularly as LED sizes go from normal to mini to micro.
Figure 3 - LED structure - Source: G. Omanakuttan, Y. Sun, C. Hedlund, C. Junesand, R. Schatz, S. Lourdudoss, V. Pillard, F. Lelarge, J. Browne, J. Justice, and B. Corbett, "Surface emitting 1.5 µm multi-quantum well LED on epitaxial lateral overgrowth InP/Si," Opt. Mater. Express 10, 1714-1723 (2020).
Another problem facing the idea of using LEDs as display light sources is efficiency. Normal LEDs are very efficient at converting energy to light, which makes them ‘bright’, but as they get smaller, they become less efficient and produce less light per mm2. In large displays this is less of a problem because a 4K TV typically has ~68 pixels/in2, while a 4K AR/VR display (0.1”) would require a pixel density of ~10,000/in2, which means the individual red, green, and blue LEDs would need to be considerably smaller and therefore less efficient (‘bright’). To overcome this problem some companies have developed LEDs that are based on nano-wires (think of them as LED ‘crayons’ in a box), which have the peculiar characteristic of increasing their efficiency as they get smaller, and, because there are many nano-wires in each micro-LED, if one is damaged, it does not generate a need for the entire LED to be replaced, which is the case with standard micro-LEDs. One of the key companies developing nano-wire micro-LED technology is Glo AB, the company that Nanosys purchased.
Nano-wire LED Structure and image - Source: Velpula, Ravi Teja & Jain, Barsha & Rajan Philip, Moab & Nguyen, Hoang & Wang, Renjie & Nguyen, Hieu. (2020). Epitaxial Growth and Characterization of AlInN-Based Core-Shell Nanowire Light Emitting Diodes Operating in the Ultraviolet Spectrum. Scientific Reports. 10. 2547. 10.1038/s41598-020-59442-0.
Did Nanosys buy Glo AB to put the technology in a closet and try to eliminate potential competition to quantum dots? No, but understanding why the combination of the two makes sense, it is also necessary to understand that even if Glo AB were to commercialize a micro-LED process that could grow all three LED colors on a single wafer, it would be a slow process involving many steps to keep the particular material deposition for each color LED in the proper place, a very challenging task. So until the technology that could make single wafer multi-LED color growth commercially viable is developed, there is an interim solution. By growing only one color micro-LED on a wafer, the process complexity can be significantly reduced, but that brings us back to creating a wafer for each of the three colors, again an expensive process. However, say the one color is blue, by depositing red and green quantum dots on 2/3 of the blue micro-LEDs, a full color RGB micro-LED display is created.
As noted, this is an interim solution toward the ultimate goal of a self-emissive quantum dot display, but it presents itself as a way that the current limitations facing micro-LED technology can be ‘eliminated’ and commercial development can occur far sooner, but there is still one problem that remains, how do you move 24.88m micro-LEDs from a wafer to a display substrate for a 4K resolution device, especially when they are less than 20um each? Typical pick and place tools, even if they could be adapted to such small structures, would take days to place that many LEDs, which is obviously not cost effective, and we have noted a variety of other micro-LED transfer techniques being developed in previous notes, but according to Glo AB, they have also developed a transfer process that is cost effective for moving such large numbers of small LEDs. We believe the process is a laser based system that moves the micro-LEDs directly from the wafer and bonds them to the substrate without any interim steps, which are the bane of other techniques, but details have not been revealed, although we expect Nanosys will share some of that information at a later date.
All in, while the acquisition of Glo AB by Nanosys might seem antithetical on the surface, the acquisition gives Nanosys the ability to more closely develop quantum dot solutions for micro-LEDs and broadens its patent portfolio to 1077 world-wide grants or applications with the additional 298 from Glo AB. While Glo was a spin-off of Lund University in Sweden and has its headquarters there, the company has a pilot production line in Sunnyvale, less than 20 minutes from Nanosys, and has partnered with a number of display and CE companies over the last few years in the development of backplanes and optical elements, all of which will be maintained by Nanosys. We expect that the path toward commercialization of a combined quantum dot/micro-LED solution will be shortened by the acquisition.[1]
[1] Please note we have no financial relationship with any of the parties mentioned in this note nor do we have any obligation to or reason for mentioning this transaction, other than our understanding of its effect on the consumer electronics space.
As noted, this is an interim solution toward the ultimate goal of a self-emissive quantum dot display, but it presents itself as a way that the current limitations facing micro-LED technology can be ‘eliminated’ and commercial development can occur far sooner, but there is still one problem that remains, how do you move 24.88m micro-LEDs from a wafer to a display substrate for a 4K resolution device, especially when they are less than 20um each? Typical pick and place tools, even if they could be adapted to such small structures, would take days to place that many LEDs, which is obviously not cost effective, and we have noted a variety of other micro-LED transfer techniques being developed in previous notes, but according to Glo AB, they have also developed a transfer process that is cost effective for moving such large numbers of small LEDs. We believe the process is a laser based system that moves the micro-LEDs directly from the wafer and bonds them to the substrate without any interim steps, which are the bane of other techniques, but details have not been revealed, although we expect Nanosys will share some of that information at a later date.
All in, while the acquisition of Glo AB by Nanosys might seem antithetical on the surface, the acquisition gives Nanosys the ability to more closely develop quantum dot solutions for micro-LEDs and broadens its patent portfolio to 1077 world-wide grants or applications with the additional 298 from Glo AB. While Glo was a spin-off of Lund University in Sweden and has its headquarters there, the company has a pilot production line in Sunnyvale, less than 20 minutes from Nanosys, and has partnered with a number of display and CE companies over the last few years in the development of backplanes and optical elements, all of which will be maintained by Nanosys. We expect that the path toward commercialization of a combined quantum dot/micro-LED solution will be shortened by the acquisition.[1]
[1] Please note we have no financial relationship with any of the parties mentioned in this note nor do we have any obligation to or reason for mentioning this transaction, other than our understanding of its effect on the consumer electronics space.
Glo RGB Micro-LED Display - Source: GLO
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