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The Present Moment



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There were somewhere around 800 million cell phones sold worldwide during 2005 alone. That's a pretty mind boggling figure.

In the PicoP interview below, Tokman says: "We are experiencing a strong market pull from global OEMs who are very interested in providing their customers with a portable handset containing an embedded projector to display and share information ranging from multimedia to business applications. Korea and Japan are on the forefront of this pull, Europe is next, followed by US."

So let's say that PicoP's unique and unmatched combination of a large, bright image, small form factor and low power requirements results in design wins from one or two or three global OEMs for production handsets to launch in 2008.

Let's say that between now and then, the handset market levels off at 800 million units per year (!).

Let's say that these PicoP enabled handsets represent just 1% of the annual market. That would give us 8 million PicoP handsets sold in 2008.

Let's say that Microvision receives a royalty between $25-40 per PicoP handset sold.

At just 1% of the market and a totally reasonable per unit fee for the PicoP IPM embedded subsystem, we get between $200-320M in revenue. Get just 10% and you've got $2B-3.2B. Should the PicoP become a must-have feature in handsets, the revenue numbers get very very large, very very fast. (It's easy to imagine how a PicoP enabled handset could make every 2" LCD screen phone just look antiquated and, well, lame.)

All this from just one application of Microvision's IPM. If you add HUD revenue and whatever we can do with Color Eyewear, and industrial/healthcare/military applications -- we are looking at a company that will be achieving astonishing revenue growth within the next two or three years.

The foundation for the future has been built. The blood, sweat and tears (!), the collected man hours of development of the technology, the accelerating developments in laser light sources, as well as the ever increasing capabilities of mobile devices, have brought us to this point.

NOW we have top tier executive management.
NOW we have an actionable, specific business plan with realistic goals and timelines.
NOW we have a strategy to fulfill our destiny of Microvision-inside, with the Integrated Photonics Module.
NOW we have more cash in the bank than we have had at any time in the last several years.
NOW we have strong market pull from global OEMs to incorporate the IPM in consumer products to be sold by the millions.
NOW we have green lasers suitable for PicoP, Color Eyewear and HUDs -- from a variety of suppliers.
NOW we have third-party validation from Bosch that all of their HUD products under development utilize Microvision's IPM technology.

NOW we sell for $1.95 a share?
NOW the Nasdaq has lost 10% of its value in a month.
NOW the Fed is continuing to raise interest rates and punish consumers.
NOW the market conditions are truly awful. And yet, MDB Capital and Microvision were able to execute their equity offering, to a group of deep-pocketed foundation investors who presumably see the promise of the IPM and in the new team at Microvision. The company put money in the bank, which gives it credibility and the ability to say to partner companies and potential partner companies, 'we're not going away, you can feel secure in partnering with us for your next-generation visualization solutions.'

I believe that the entire psychology around Microvision and how the company is perceived will radically shift when we get the first design win for the IPM.

Bosch put out a press release in May touting the laser scanning HUD they're developing using the IPM. That would suggest to me that we may have made substantial progress driving towards an IPM design win since the Microvision/Bosch Letter of Intent was signed in September of last year.

So we'll see whether it's Bosch and HUDs or another global OEM for the PicoP that goes first. But I believe the IPM's unique advantages over present day, fixed-pixel displays will prove too compelling for OEMs to sit on the sidelines forever. And once the first one hits, the others will all get on board too so as to protect or gain market share. In this way, the paradigm is shifted.

To be totally honest, although I think my parents probably worry a little bit about me when they see the MVIS ticker, I don't feel the pain of the stock price that much. Because I believe in what these guys are doing and I believe that truly extraordinary returns are possible just by sticking with it (or, of course, adding here...). I believe that the present day dominant paradigm of the fixed-pixel display is not long for this world. And that Microvision technology will become the standard human-computer interface within the next ten years.

I believe in the power of the present moment and letting the past go in the rear view mirror. This means not letting past disappointments cloud my view of a new horizon of possibilities.

And it means to enjoy the mountain while I'm climbing it. No matter if it's a little higher than I had thought it was at the base.

2 comments:

At June 11, 2006 at 6:28 PM Anonymous said...

Nice developments this week (SID, ABC News, and Tokman interview on MVIS website). Time for a CC.
Great post Ben.

 
At June 12, 2006 at 10:56 AM Maribucho said...

It appears that new management team is delivering what it projected at the beginning of the year. There are many challenges remaining and the road it’s very complicated.
My money and wishes are with the company, but there are also lots of worries about the future.
Keep up the good work.

 

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