By Julian Bleecker, Ph.D.
Research Fellow, Annenberg Center for Communication
Assistant Professor, Interactive Media Division
University of Southern California
The Internet of Things has evolved into a nascent conceptual framework for understanding how physical objects, once networked and imbued with informatic capabilities, will occupy space and occupy themselves in a world in which things were once quite passive. This paper describes the Internet of Things as more than a world of RFID tags and networked sensors. Once “Things” are connected to the Internet, they can only but become enrolled as active, worldly participants by knitting together, facilitating and contributing to networks of social exchange and discourse, and rearranging the rules of occupancy and patterns of mobility within the physical world. “Things” in the pervasive Internet, will become first-class citizens with which we will interact and communicate. Things will have to be taken into account as they assume the role of socially relevant actors and strong-willed agents that create social capital and reconfigure the ways in which we live within and move about physical space.
The Internet of Things brings many vectors together — pervasive networks, the miniaturization of networked devices, mobile communication, the refashioning of physical space as we cohabit and co-occupy space with Things. When the network that has facilitated a profound, unprecedented knitting together of complex, multivalent social formations seeps into a space — the physical, geospatial world — which was previously void of such, what does it all mean? When it is not only “us” but also our “Things” that can upload, download, disseminate and stream meaningful and meaning-making stuff, how does the way in which we occupy the physical world become different? What sorts of implications and effects on existing social practices can we anticipate?
When we think of the kind of social networks that the Internet facilitates, we think of human agents participating in an exchange of ideas, centered around meaningful topics, whatever they may be. Until now, “objects" and “things” have been conspicuously absent from this sphere of making culture. When considered in the context of a pervasive, ubiquitous, everywhere Internet — an Internet that spills out beyond the tethered connections and local WiFi hotspots to consume nearly every corner of the physical world — the idea of objects in that physical world, now able to network, communicate and participate in the social web becomes a tantalizing consideration for novel designed experiences.
In the UK, Cambridge University was awarded approximately £2.4 million under the Basic Technology Research Initiative to develop microscopic lasers. Based on liquid crystals and light-emitting polymers, the lasers are expected to integrate features of dye, gas and diode lasers. They will be less than the width of a human hair and will be stable and emit very pure light because they will not hop from one mode of emission to another. The lasers will be tunable to any wavelength from the UV to the IR by sending an electric signal to them.Thanks to BlaydonRacer.
The devices are expected to have applications in such areas as medical science, telecommunications devices, and displays for televisions, computers and mobile phones.
The research project is a collaborative effort of the university’s departments of physics, engineering and chemistry.
PALO ALTO, Calif --(Business Wire)-- Feb. 21, 2006 HP (NYSE:HPQ)(Nasdaq:HPQ) today announced a year-long observation of the 40th anniversary of HP Labs, the company's central research organization, and outlined an ambitious, far-reaching vision for the future of information and communications technology.
That future could include:
- Worldwide, connected, continuous, secure computing through virtually unstaffed, automated data centers;
- Bringing the power of digital technology to commercial printing, and creating ubiquitous, low-power, low-cost, lightweight displays that could convey multimedia information in formats as small as a wrist watch or as large as wallpaper.
- Advances in computing technology that could extend Moore's Law beyond the limits of classical physics and provide a quantum leap in performance, reliability and security, vastly improving information and communications services in business, education, medicine, government and daily life.
"Forty years ago, few imagined personal computers, the Internet, the World Wide Web and inexpensive color printers or cameras that operated without film," Lampman said. "HP Labs researchers were among those who did and who worked, in fundamental ways, to help create the world we enjoy today."
HP Labs is working on improving future information and communications technology in several major areas:
- Reinventing the Economics of IT: The long-range goal is a worldwide network of massive, secure, energy-efficient data centers that automatically allocate resources to users, based on market demand.
"Joel Birnbaum was one of the first to articulate the vision of utility computing - where customers use only the resources they need and pay just for what they use - when he was HP Labs director in the late '80s," said John Sontag, director, data center architecture and virtualization, HP Labs. "Today, HP is a leader in the effort to make that vision a reality."
- The Future of Imaging and Printing: HP, the acknowledged world leader in home and office printing, is exploring the potential to digitize all types of publishing - from brochures to periodicals to billboards. In addition, HP Labs is working on continued improvements in digital photography, video and projection; automatic publication composition; and future display technologies.
"We're working to revolutionize the world of commercial printing with digital technology, just as we did with personal printing," said John Meyer, director, Digital Printing and Imaging Lab, HP Labs. "We are also studying paper-like electronic materials for portable information devices. These kinds of materials also could work for a wall display and you could change the decor of your home as often as you liked."
- Disruptive Technologies: HP scientists are exploring the realm of quantum computing to extend advances in semiconductor technology into the future.
"The researchers in our Quantum Science Research and Information Theory organizations are making breakthroughs not only in the underlying science, but the architecture and fabrication technologies that will enable an entirely new generation of computing," said Phil Kuekes, senior scientist and computer architect, Quantum Science Research, HP. "We expect these changes to continue the tradition of 'better, faster, cheaper' for decades to come and to provide applications in the future that - just like the Internet and digital photography 40 years ago - we can only dimly imagine today."
Ahn Kwang-june is an artist who uses images from dreams as the main motif for his works. He talks about his dreams and a precarious boundary between reality and virtual reality through three-dimensional visual works and game art.
Unlike other conventional exhibitions, his unusual works require active participation from the audience, as they are obliged to wear specially designed glasses and use joysticks. With those glasses on, viewers can experience a surreal three-dimensional world in which dreamy images of Ahn's work pop out and move back and forth between reality and virtual reality.
"A dream does not unfold in an inactive screen but in endlessly changing movements. It is not restrained by space or time. Thus a flat canvas was not good enough for me to express everything I had in mind."
So he decided to use three-dimensional technology and a graphic software to recreate in detail the realm of dream, which was a temporary virtual reality. Instead of using traditional art tools such as pastel, acrylic and paint, he depends on clicks of a computer mouse and the insertion of numbers on a keyboard to express his world of dreams in vivid movements and colors.
His representative work ``Space Mirror Object 2006'' has given life to whirling atmosphere and spiral of rainbow-colored clouds. As units of such images move at fixed speed, they form a symmetry with each other, which leads viewers with glasses to feel as if they are being put into a state of hypnosis. A surrealist technique, decalcomania, can be witnessed while those images make movements in a certain pattern in the process of integration.
"Ahn is one of the rare artists who has been consistently working on discussing the matter of virtual reality. We expect that these surreal and unfamiliar images that are recreated through most state-of-the-art technology can pave the way for a new arena of media arts," said Hwang Jeong-in, a curator of the museum.
Labels: Virtual Reality
I wanted to pull out and amplify some of the comments made by Steve Willey during his recent speech in Japan that I feel are really important to understanding Microvision's focus, which will form its new identity:
"We're not interested at all in very small displays. We're interested in very big multimedia experiences."
"In the consumer space, Microvision is entirely focused on the interface to the handset. Our role is that delivery of these multimedia experiences to the user."
"We need to unlock the power of these multimedia devices. Whether they be handset, game players, iPods or otherwise, if everything's limited to the 2" screen, the opportunity to give the consumer an experience they will pay for is limited."
"Our products are radical and new. We believe that our greatest opportunity is to work in Japan, with Japanese partners, and to introduce these products into the Japanese market."
The greatest opportunity for Microvision is to function as the delivery mechanism of mobile internet content from the cell phone to the user. You know this. I know this. Microvision knows this, and now they are committing themselves to becoming a standard mobile internet interface in the next two years.
Imagine a dam that has a rushing river behind it, and there's a 2" square hole in the dam. The river is the potential profits from gargantuan investments in networks and digital content. The 2" hole is the current standard LCD screen. A good amount of water can spray through that tiny hole in the dam. Now if you scale up that hole in the dam to the full size of the other standard interfaces to multimedia content (HDTV widescreen displays), then there's no limitations anymore. The river flows freely. The true profit potential of mobile digital content can be achieved, for the first time.
It is really vital in this discussion to understand that Microvision does not exist in a vacuum -- the '4th screen' that only Microvision can provide will allow consumers, content owners, device manufacturers, and service providers to all benefit hugely.
For consumers, they'll be able to have access to the same quality of multimedia on their mobile phone that they do in their living room. I've had a cell phone that can download games for the last year and a half, and I've only bought two games -- a bowling game and an NFL game. I've thought about adding a couple more, but it's not really that compelling an experience compared to firing up the Xbox on my HDTV at home. The content providers try to make up for the 2" screen by pricing games at $5-7, or $3 monthly subscriptions. Even so, it's easy enough to just keep playing the bowling and football games and not load the phone up with content.
For content owners, the 4th screen offers a hugely compelling proposition. Imagine you are Electronic Arts. You've developed Madden 2007 and it's certain to be a huge hit for the PC and across the console platforms. Now, without the 4th screen, when it comes to the mobile phone version, you would be forced to create essentially a lobotomized version to fit the tiny screen -- and charge maybe a tenth the price of the full version. With a big visual experience available in an MVIS-inside mobile phone, the same content developed for PCs and consoles can be leveraged across the mobile platform. The content is compelling enough to justify the same types of prices that they get for the console version (a 10x increase over the 2" screen version!). More bang for their development buck. Huge new revenue streams. A better experience for their users. Better brand equity and loyalty.
Device manufacturers benefit as they will be the ones incorporating the IPM into their new products. They will be able to usher in a new generation of devices that will bring customers into stores and have them replace their clamshell and candy-bar phones by the millions. Companies that partner with Microvision to introduce virtual displays will be differentiated from their competitors by offering radical, new capabilities that can't be matched by the current generation of products with their traditional, physical flat-plane displays. We will see soon what the value is to one of these device manufacturers of being first-to-market with a mobile virtual display.
Service providers will benefit as they will be able to charge premium prices for this BIG EXPERIENCE mobile multimedia that's being held back by the 2" screen. There will be demand for ever greater bandwidth to fill the virtual screens and service providers will be able to offer numerous value-added services that simply could not exist in the world of the 2" display. The mobile experience is vastly improved, and really transformed. There is huge value in owning and operating cellular networks in a world where mobile digital content is ubiquitous and of a compelling, high quality. Next-generation mobile services made possible by the 4th screen, including rich mobile TV and mobile internet browsing, location-based services, transaction capabilities and social networking, as well as new types of user experiences like virtual networking (next-generation videoconferencing) will usher in new torrents of revenue for the network operators and service providers.
It has been abundantly clear to me and many readers of this website that Microvision is astonishingly undervalued based on their potential future cash flow. At this moment, the market is not pricing in any percentage likelihood of a design win for the Integrated Photonics Module (IPM) into a cell phone or cell phone companion device.
Imagine for a moment that Microvision achieves such a design win for the IPM and Color Eyewear and Picoprojector products are sold by a major handset manufacturer sometime in the near future. What then is the price of a share of MVIS? How would the market evaluate the likelihood of additional design wins?
I believe that the first commercial design win for the IPM will establish Microvision as a serious player in the mobile industry, and in the process unleash a waterfall of new opportunities for the company, as well as a market valuation that is orders of magnitude over the current one. The mobile space is huge and only growing larger. But its profit potential, for content owners, handset manufacturers, and service providers is constrained by the 2" screen. Microvision's IPM is the only solution to having a BIG EXPERIENCE in the kinds of small packages that consumers already depend on.
With focus, identity is formed. Microvision is now entirely focused is on providing a big experience to mobile internet users. Microvision now understands that its role is to be the delivery mechanism for mobile multimedia. Ultimately, Microvision's destiny is to become the standard, indispensable human-computer interface.
In order to achieve this vision, resources are being focused, discussions with strategic partners are ongoing, and goals are being set. In the 2006 Operating Plan conference call, the goal was set to sign at least one agreement with a strategic OEM for the Picoprojector platform, and at least one agreement for the Automotive HUD. Goals will be set for Color Eyewear when the greatest market need is identified and the type of product or products to pursue are determined.
Whether you think the company will meet their goals or not, they have been set and they are very clear: Sign agreements during 2006 to have OEMs incorporate the IPM into two new products. This will illustrate to the world that Microvision is here to stay and that the company's technology platform and intellectual property are going to generate money. The question (if you ask me!) will then become whether it's big money, gargantuan money or incomprehensibly huge amounts of money -- how many design wins, how many applications, how much global market share of the human-computer interface.
When you focus on something and work really hard at it, it becomes who you are and what you're about.
When you realize the potential of who you are, it becomes your destiny.
MVIS Blog is not responsible for transcription errors or omissions.
The "Freedom" of Virtual Displays
Remarks by Steve Willey, President of Sales and Marketing for Asia:
Thanks very much for providing us this opportunity to talk about what we're doing and how we could significantly effect our industry. The major message this evening is that as humans we consume multimedia. We're at the point now in the evolution of handsets that there's the opportunity to provide high quality multimedia to the mobile user. We believe strongly that if improvements are not made to the interface of a handset, specifically the 2" screen that we're all very much aware of, that some of these opportunities will be deleveraged. In order for consumers to value highly the multimedia that's going to be resident in a handset, and in order for them to justify paying for it, we would argue that the interface must be improved. We're here this evening with Randy Sprague, our director of technology and Shigeru Shinzawa who's a resident of Tokyo.
The World's Smallest Color Display
I included this because this came in the mail about a week ago. This company's claim to fame is an mp3 player with the world's smallest color display, an inch and a half by an inch and a half or something. Microvision is on the other end of the spectrum; we're looking to make the display as large as possible and hence the title of this presentation, the Freedom of Virtual Displays. We're not interested at all in very small displays. We're interested in very big multimedia experiences.
So from the standpoint of mobile multimedia, what appears to be obvious to everyone is that the device needs to be as small as possible. Portable, personal, pocketable. But at the same time, with the increasing availability of downloadable multimedia, you'd also like to maximize that multimedia impact. That means you'd like a display that has tremendous color, resolution and dynamic range. There's a conflict obviously. How do I get a device that's that small and how do I get an experience that's that big, to justify paying for that experience. That's become the business of Microvision. Microvision has other activities in the medical and industrial markets. In the consumer space, Microvision is entirely focused on the interface to the handset. Our role is that delivery of these multimedia experiences to the user. And I'll describe that in more detail.
The Human Being - a Consumer of Multimedia Experiences
So a little bit about the human being and the way we're wired. We really are a consumer of multimedia experiences. We go to the cinema and will pay for that privilege, because it's a big impact, a big experience. People want ever larger TVs and desktop monitors, they like that experience. Advertisers will pay a lot more for a full page print ad or full page web ad. And this is not surprising, going back to the days of the caveman, we've always depended on our eyesight for safety. And as a result, our visual bandwidth is 20x greater than our audio bandwidth. So if we want to maximize this experience, this impact, this excitement, what we should look at is maximizing the visual experience.
Supporting Evidence from recent Las Vegas Consumer Electronics Show
Relating to that comment about the visual experience, displays dominated the CES show. This was the year of the display. Convergence has finally happened in a very complete way. Web, games, cameras, TVs can be mixed and matched in a large number of ways and we can count on that going forward. There are now 3 universal platforms, the PC is a strong platform. The console player is the living room entertainment player. The third is the handset - a universal platform looking for applications. Digital content, we can expect that to be available on any of the platforms.
Opportunity for the Mobile Industry
We now have convergence, standard platforms, content available, what do we do with it? We try to create opportunites to deliver and sell these services to the consumer, in the mobile space. Our task is delivery. It's not good enough to be creating multimedia, but delivery is a vital piece to it. We make the comment that we need to unlock the power of these multimedia devices. Whether they be handset, game players, iPods or otherwise, if everything's limited to the 2" screen, the opportunuty to give the consumer an experience they will pay for is limited.
Handset Platform "Dilemma"
This is the dilemma. The handset is getting more exciting. There's a Nokia phone with 4GB hard drive, moving to 8GB. With 3G, and 3.5G, obviously we've got bandwidth. Everything you could ask for, we've even got some interesting applications such as mobile TV. In the US, there's a shift to thinking of mobile phones as handsets with multimedia content.
The dilemma that people are recognizing is that people are not going to go to a larger cell phone. Maybe there's a tradeoff as to what people can expect from a small phone. If you have a small display and you're looking at a soccer player, football player, and you're looking at a 1" display, it's almost like a cartoon, so small there's no benefit. If you use a QVGA display, you can see that there's some things going on but you're not quite sure what. If you move that to an SVGA display, you can see the opportunity immediately to create an experience that is valuable.
Who would benefit from a "Big Screen" Handset Experience?
So if you could get from a 2" screen to a desktop screen in a handset, who would benefit? Consumers would benefit, they'd get the experience they're used to. Handset manufactures, they like this, there's a new generation of handsets and accesories. Carriers would be able to offer high-value, premium priced services. Content providers and there's someone from Disney here today, and this screen that is facilitated by this gateway, this becomes the 4th screen to leverage their assets, Cinema, PC, TV and Mobile Phone. Handsets should not diminish content value.
Heart of the Display: MEMS Scanner
Let's say you want a larger screen. We want a better, more valuable experience, how do we do it? We can make the screen physically larger, which makes the handset larger, and that's a non-starter. Or we can create an illusion. Microvision creates a large screen illusion from a small package. Two ways we do this, either through eyewear or some form of projector. The Picoprojector is a very small device that connects to your mobile device and enables a bigger experience. Microvision has a heavily patented system that uses a MEMS scanner. Microvision builds displays, but not flat panel displays or LCD displays. Our displays are very different. The core to our display is this mirror that moves really quickly. Our solution has low power, low voltage and highly reliable.
The Microvision Difference
A traditional desktop quality display has a half a million pixels. In our world, we take a red, green and blue light, combine them and bounce them off a millimeter mirror and that creates an illusion, a virtual display which can be worn as eyewear or that display is a microprojector.
Microvision Projector Configurations
Personal eyewear, people expect HD quality in their handset displays. Plasma quality. Projector, something about the size of a mobile phone, HD quality. The projector can be built into the phone itself.
Microvision is in the virtual display business. One of our business units relates to industrial markets, here's a mechanic looking at a virtual display in a work environment. We take that technology and apply it to the consumer and mobility markets. Our sense is that this display will have to be HD resolution. Eyewear would have to be stylish, comfortable and cool, have good battery life and be well under $500. Microvision recognizes that we need to bring a premium quality product to the market at a consumer price.
This is all the ways people failed in the past, they took a small flat panel and put a magnifying glass in front of it and made it wearable. It looks ugly and it's uncomfortable, and people just don't accept it. Eyewear has to be stylish, comfortable and priced right.
We anticipate first generation displays coming to market over the next 2 years. With recognition of the problem of 2" display, people will start to experiment with wearable displays. We'll see the product improve over the next couple of years, and eventually wearable displays and projector displays will become a standard and the norm.
After describing the virtual display, here's a virtual keyboard from a company called iTech. What's interesting is if you start combining a virtual keyboard with a virtual display. A very interesting place for Microvision to play, you may see us participate in both sides of the interface.
In summary, it's up to ourselves as the industry to manage the consumer experience. There is the risk of having fantastic multimedia available, but we don't want to disappoint consumers with the 2" screen. All the underpinnings are there, the convergenece, the universality of the platform.
Finally, Microvision is in Japan for a reason. Our products are radical and new. We believe that our greatest opportunity is to work in Japan, with Japanese partners, and to introduce these products into the Japanese market. So thank you very much for the opportunity this evening to discuss this with you. Thank you.
On behalf of Morgan Lewis-TMI, thank you for your interest in our Mobile Industry Panel, held 30 January 2006 at the offices of TMI Associates. This invitation-only event featured a sneak preview of a new mobile product designed specifically for the Japanese market by Microvision, Inc., a leading display technology company.Thanks to view from afar.
The evening also included a panel discussion covering key trends and issues for 2006 in Japan’s mobile industry. The panel had representatives of Walt Disney Internet Group, Nikko antfactory, CSK Venture Capital and Picsel Technologies and was moderated by one of the leading media and telecomm lawyers in Japan.
John Y. Sasaki and Tatsuhiro Takahara – Partners – Morgan Lewis-TMI
Morgan Lewis-TMI is a joint venture between Morgan Lewis and TMI Associates. Morgan Lewis is one of the largest law firms in the world, with more than 1,200 lawyers in 19 offices worldwide. TMI Associates is one of the largest law firms in Tokyo, with over 100 Japanese lawyers and an additional 30 Japanese patent lawyers. Through the combined power of the two firms, Morgan Lewis-TMI offers a full spectrum of fully-integrated, cross-border legal services.
John Sasaki and Tatsuhiro Takahara practice in the areas of corporate and securities law, with experience in venture capital finance, public offerings, M&A and technology transactions. Their practices also include the representation of technology start-up companies.
Steve Willey - President of Consumer Solutions - Microvision, Inc.
“The Freedom of Virtual Displays”
One of the limitations on interactive mobile phone applications is the size of the screen. With Microvision’s virtual display technology, images transmitted across mobile networks can be displayed in space, unlimited by the size of a phone screen. Imagine being able to see a spreadsheet transmitted via phone, or being able to play a video game on your mobile — in the air in front of your eyes. Steve Willey will provide a sneak preview of a new product developed specifically for the Japanese market.
Microvision Inc. is the world leader in the development of high-resolution displays and imaging systems based on the company’s proprietary silicon micro-mirror technology. The company’s technology has applications in a broad range of military, medical, industrial, professional and consumer products.
Tomohiro Tohyama – Partner – TMI Associates
With over 100 Japanese lawyers and an additional 30 Japanese patent lawyers, TMI Associates’ combination of strengths in corporate transactions and intellectual property matters makes it unique among law firms in Japan. Tomohiro Tohyama is a founding partner of TMI and one of the most prominent telecommunications and media lawyers in Japan.
Featured Panelists include:
David Milstein - VP of Strategy and Business Development - Walt Disney Internet Group (Asia-Pacific)
Walt Disney Internet Group (Asia Pacific) (”WDIG AP”) launched its “Disney-i” mobile Internet business in August 2000, and now boasts more than 3 million subscribers. David Milstein is responsible for WDIG AP’s strategy and business development in Japan and APAC (outside China).
Naoki “Nick” Kondo - Professional Partner - Nikko antfactory K.K.
Nikko antfactory is one of the leading financial services providers in Japan focusing on private enterprises. The firm’s services range from venture capital and private equity financing to restructuring and M&A consulting. During his time at Nikko antfactory, Nick Kondo has led investments and management of Virgin Cinemas Japan, Artist House, Hyperfitness, Senior Communication, eBook Initiative Japan, Triwall, Recruit, and Aunt Stella’s. He currently serves as President and CEO of Aunt Stella’s.
Makoto Kaneshiro - Managing Director - CSK Venture Capital Co., Ltd.
CSK Venture Capital is one of Japan’s leading venture capital firms. CSK’s recent investments in the area of mobile technologies and services include Peregrine Semiconductors of the U.S., Picsel Technologies of the U.K., DxO of France, Horizon Semiconductors of Israel, GameTrust of the U.S., and IP Mobile of Japan. Makoto Kaneshiro is the Managing Director in charge of CSK’s overseas investments.
Ali Adnan - Chief Operating Officer (Japan) - Picsel Technologies Ltd.
Picsel brings mobile content to life through a unique suite of patented User Interface functions, which delivers a superbly rich and intuitive user experience on small screen devices. Picsel’s success is built around its groundbreaking ePAGE technology, a multimedia content engine, that enables mobile users to interact with every type of content, in all its original richness, on any kind of device. Ali Adnan plays a key role in developing Picsel’s Japanese market and has been instrumental in providing technology to enable the delivery of rich content on mobile devices.
Labels: Mobile Phone
As TV becomes more pervasive on mobile handsets, demand is expected to mushroom for personal projector devices. The idea is similar to virtual keyboards: Eyeglasses fitted with tiny projectors or a separate tabletop pico-projector device, smaller than a mobile phone, could be used to give viewers a larger virtual display. Microvision, which already makes wearable displays for industrial and military use, is positioning itself to move into the consumer space by partnering with other equipment manufacturers.Thanks to Danny Golan.
Microvision uses a single-mirror MEMs chip and has a patented approach similar to the “flying spot” approach used in conventional TVs, but without high-voltage electronics or a vacuum tube. Instead, a single vibrating mirror directs colored pixels either toward the eye (for video eyewear) or to a viewing surface (for a micro projector). To the user, the eyewear looks like a full-size laptop display, only better, and uses only milliwatts instead of the watts used by laptops, according to an October 2005 Gilder Technology Report. MicroOptical and iCuiti, two U.S. companies, already sell video eyewear, but the Gilder report says Microvision’s systems “beat the competition in every category, cost, quality, compactness, power-efficiency, and versatility.”
Given the company’s unique optical technologies and its work on both tabletop personal pico projectors and video eyewear, Ken Blakeslee, a London-based wireless investment advisor, says he thinks Microvision is well positioned to compete for mass-market consumer business. The challenge for Microvision is to overcome its short-term financial difficulties that result largely from its investment in R&D, and current dependence on niche markets.
I was totally floored when I saw Jeff Han's Multi-Touch Interaction Research Video that's in the embedded player in the prior post. Then I took a look at Mr. Han's other projects for NYU Media Research Lab.
Sometimes I think about how talented people are and I'm just blown away. There's so much cynicism and negativity in the world (unfortunately well expressed on the Yahoo message board for MVIS) that when I see something like this work by Jeff Han and the rest of the Media Research Lab at NYU, I find it so affirming and refreshing.
The work of building the future goes on, day after day. But so much of it happens away from the spotlight that you really have to go looking for it, to see who's pushing the boundaries, who's bringing the future into focus. In this way, things can seem to come out of nowhere when they've really been baking for quite a while. Kind of like Microvision displays. When the first mass-market applications hit for scanned-beam technology, it will appear to the world at large as an overnight sensation that is sweeping over the world and transforming how people interact with digital information. MVIS longs will know that every design win is the result of years and years of research, diligence, sweat and brainpower.
One of the first things that I thought when I saw this video was, what if a Microvision Picoprojector had a video camera on it as well? It could take a video of whatever it's projecting and then do some of these same types of things, based on recognizing your fingers moving around in the projected image. In this way, your fingers, and the Picoprojector both become a user-input device.
From the video it's clear that letting users involve their hands with the display as an input device opens up entirely new realms in what computers can do and how they operate.
Just want to say 'Cheers' to Jeff Han and all the other brilliant researchers all around the world who are dragging the dreams of science fiction into the world of the near future.
Check this out. Pretty incredible.
Multi-touch Interaction Research by Jefferson Y. Han
I was really keen to see these two press releases as they give a lot of insight into some of the things that are happening at Microvision and the bigger picture that's pulling light source suppliers into mass production of lasers that would be suitable for full color Microvision displays at a very low cost.
Mitsubishi plans to have their Laser TV on the market within two years. According to the press release, Laser TV offers image quality that surpasses LCD and Plasma panels. So, I think it stands to reason that if Mitsubishi is going to full production of Laser TV in 2008, then many other manufacturers are sure to follow. This is hugely important to the arrival of low cost light sources suitable for Microvision displays.
The question about light sources to power things like the MicroHUD, PicoP and Color Eyewear has been how to get them mass produced so that the costs come down dramatically. Now it's not just Microvision's applications that are providing the demand for light source manufacturers to start churning out next generation laser light sources. It's TV manufacturers.
This is HUGE for this company. The widespread availability of low cost light sources will enable Microvision's applications to come down in price, which opens new market opportunities by itself; and it reduces risk to OEM companies who may be considering partnering with MVIS to incorporate the Integrated Photonics Module (IPM) in any given product.
With the arrival of Novalux NECSEL light sources, Microvision was able to create the PicoP: "According to Greg Niven, Novalux vice president of marketing, "In the past, laser-based projectors have been limited by the constraints of green lasers—typically the only green option was a diode-pumped solid-state unit. With NECSEL technology, we can now produce an inexpensive, compact green source ideal for this application."
This adds up to something really significant. Cheap laser light sources in miniature package sizes are coming online due to market demand beyond Microvision itself. Big, powerful companies like Mitsubishi are now on record saying that full production of Laser TV is a go for 2008. This means that there will be competition among light source suppliers like Corning, OSRAM and Novalux to provide the cheapest, brightest, smallest, most efficient lasers in red, green and blue.
This means cheaper prices and wide new markets for MVIS products, less risk for potential OEM partners and a clearer path to the fruition of the MVIS-inside vision.
(Kyodo News International (Tokyo) (KRT) Via Thomson Dialog NewsEdge) Feb. 15--OSAKA -- Mitsubishi Electric Corp. said Wednesday it has developed what it says is the world's first rear projection television that uses a laser as its light source instead of a mercury lamp as with current rear projection TVs.
The laser-based rear projection TV provides a higher picture quality than liquid crystal display and plasma display panel televisions, according to the home electronics equipment maker.
Mitsubishi Electric President Tamotsu Nomakuchi told a news conference in Amagasaki, Hyogo Prefecture, "We want to release the product on the market in two years" by creating a mass-production line capable of being run on a commercial basis.
With Mitsubishi's existing lineup of rear projection TVs, light from a mercury lamp -- installed in the rear section -- is split up into red, blue and green to create images on the front screen.
In the new rear projection TV, light from a semiconductor laser is divided into red, blue and green, making it possible to represent images with a color variety 1.8 times greater than that of LCD TVs and thereby improving image quality.
In addition, the depth of the new TV was limited to 26 centimeters -- the same as that of the company's existing mercury lamp-based rear projection TVs.
The new product has eliminated the problem of existing rear projection TVs being unable to project images of a comparable quality to those of LCD and plasma display TVs, the company said.
Nonetheless, the company said it has to finish some remaining technological tasks to minimize the size of the power-source unit of the new TV and manufacture the product at lower cost before it can release it on a commercial basis.
NOVALUX WINS INSIGHT MEDIA “BEST BUZZ” AWARD AT CONSUMER ELECTRONICS SHOW
NECSEL™ Light Sources for Projection Display Named “Best New Enabling Technology”
Novalux Wins Insight Media “Best Buzz” Award at Consumer Electronics Show
NECSEL™ Light Sources for Projection Display Named “Best New Enabling Technology”
SUNNYVALE, Calif., February , 2006 – Novalux, Inc., developer of Novalux Extended Cavity Surface Emitting Laser (NECSEL™) technology, has won a “Best Buzz” award from Insight Media, a leading source of intelligence about the display industry. The award is for “best new enabling technology” shown during the 2006 International Consumer Electronics Show (CES) in Las Vegas, Nevada. Insight Media selected Novalux based on the company’s NECSEL illumination sources for projection displays. Novalux demonstrated its NECSEL technology at CES in two rear-projection TVs (RPTVs) along with a concept “pico-projector.”
“We give our ‘Best Buzz’ awards to companies that present something especially cool or exciting at CES—things that we end up going home and really talking about,” said Chris Chinnock, Insight Media president and founder. “Laser TV is something people have been dreaming about for a long time. With their RPTV demos, Novalux has put a very nice stake in the ground toward that goal. When you show lasers that are starting to get to the power levels and price points that can enable this technology it gets people’s attention—that’s the buzz.”
Novalux’s CES demo centered on two laser-based RPTVs based on its prototype 1.5W NECSEL light sources. One unit featured 3LCD technology while another was DLP™-based. The RPTVs showed the expanded color gamut and simplified, lower cost light engine architecture that laser technology provides over conventional UHP lamp-based systems. Specifically, with DLP™ systems, NECSEL technology eliminates the need for a color wheel, light tunnel and relay optics. For 3LCD engines, it eliminates the polarizers, color filters, turning mirrors and fly’s eye lenses.
Novalux also featured a concept demonstration “pico-projector” developed by a partner company that is a leading supplier of innovative scanned beam technologies [Ed. -- that's us, gang!]. The concept unit outputs approximately 25 lumens from a light engine measuring just 100 cubic centimeters. The initial demo projection engine houses red, green and blue lasers, the laser driver, beam-combining optics and a 2D MEMS scanner. It uses a NECSEL prototype single-emitter for its green source and edge emitters for blue and red. According to Greg Niven, Novalux vice president of marketing, “In the past, laser-based projectors have been limited by the constraints of green lasers—typically the only green option was a diode-pumped solid-state unit. With NECSEL technology, we can now produce an inexpensive, compact green source ideal for this application.”
“We are excited about the positive response to our NECSEL technology during CES,” said Jean-Michel Pelaprat, Novalux chairman and CEO. “Our initial NECSEL-based rear-projection TVs show our ability to dramatically increase display performance and facilitate simpler, compact, lower-cost light engines. We also believe that NECSEL technology could enable a host of other new projection devices. The concept ‘pico-projector’ shown at our demo is a good example—the concept unit produces substantial light output from a package a fraction of the size of today’s LED-based pocket projectors.”
To date, Novalux has shipped samples of its 1.5W green and blue NECSEL devices to consumer electronics partners. The devices are housed in a revolutionary package smaller than a matchbox. All NECSEL light sources produce color-saturated output, allowing them to reach a larger color space than competitive lighting technologies. Moreover, NECSEL sources provide bright, speckle-free output, resulting in clear, vibrant images unattainable by any other lighting technology. Additional advantages include long lifetime, instant-on and low étendue.
Tactile 3D is the next generation 3D desktop that aids in organizing your files and directories by allowing you to customize their position in a 3D space. All common file operations are supported. Welcome to cyberspace.
Think of Tactile as a 3D file explorer with the ability to organize in a 3D space by exploiting useful visual and audible cues. The design of the interface is based on our remarkable ability to recall the placement of a virtually unlimited number of stationary objects. Quick! Where's your camera? What drawer are your blue socks in? Tactile 3D effectively identifies files, directories, and drives by using various 3D models. Organizing your data in a more visual way alleviates the current necessity to remember cryptic file and path names to get what you want.
Many features of modern 2D desktops remind us that there isn't enough room to organize large numbers of files. Menus that pop up from nowhere and virtual desktops are indications that a better organizational construct is needed.
Tactile 3D corrects these deficiencies by improving upon traditional tree-based file system interfaces. It is more than a 3D replacement for your 2D desktop. It is an organization system for entire hierarchies of information. It will not try to take-over your current desktop and runs as a standard windows application. The desktop has had decades of development and any improvements need to integrate into that established and robust framework.
The Tactile 3D UI allows you to roam around a 3D space and place objects where you want. Each object gives clues as to its contents by emitting sounds and mapping thumbnails and icons onto certain faces. Other cues include a faster rotation rate for recently accessed content, different lighting for read-only files, and variation in collision sound effects based on file size.
Structurally Tactile 3D is a tree and allows you to explore your entire filesystem. You are able to enter various spaces like hard drives, removable media, and directories. The scale of the the space you enter depends on the number of files and other objects that must fit inside. The overall impression this leaves is one of exploring a vast virtual landscape, with each directory being a new world. It's difficult to describe; so simply try it for yourself.
It's going to take an understanding of new ways to interact with and explore data in order to for persistent consumer augmented reality to take flight. New interfaces that exploit new metaphors beyond the Windows desktop will be required to make sense of a fully 3D, mobile and interactive computing environment. I'm really interested to see cool new applications for managing data beyond dealing with the really unintuitive folder/file metaphor.
I think people have a hard time comprehending that the world that they see is going to change -- and is changing at that very moment. People get attached to things. They like their flip phone, they like their computers (but Windows 'blue screen of death' I think people will be happy to move past), they like their safe, comfortable world of the known and understood.
I think younger people who have really been immersed in extremely rapid technological progress have a better handle on how things are changing. They intuitively understand exponential growth and change and have seen how it has had an impact on their lives. They embrace change as vital and necessary.
Connections between people through technology are presently limited to audio virtual reality (phone calls), instant messaging with tiny 'avatar' images that are supposed to represent each person you're in contact with (I usually alternate between a bengal tiger, Geddy Lee and Bill Belichick), and relatively rarely used and still clumsy video conferencing.
But that's going to change. There's no reason why in five years I won't be able to sit in my living room and see a lifelike virtual representation of my father sitting in the room with me, even though he may live thousands of miles away. Microvision color eyewear will be able to superimpose high-resolution images on my field of view to give me an information overlay, perform 'virtual reality networking' with friends, family and business contacts -- even the computer interfaces will take on virtual reality elements, represented well by Tactile 3D.
By 2010, computing resources will likely be grid-based with small client machines that send calls to grids of supercomputers to perform processing and then return results to user. These grid clients will allow regular consumers to have access to the same power of computing that's used in long range weather forecasting and nuclear explosion simulations. Plenty enough horsepower to drive a fully convincing 3D model of any human being, or virtual environment to your Microvision eyewear.
In a world of 3D computing, the key advantages of Microvision's platform are really amplified. There's no physical screen. There's just virtual images and your regular field of view. There's less power consumption as there's no backlight to power.
The ability to provide an immersive digital display without any physical screen opens up new worlds in design and device form factors. The digital world stops being flat. It starts becoming 3D.
I've written a lot about how the internet is going geospatial and I really believe that. Every day you hear about a new cell phone company that is GPS-enabling their products and planning to deliver location based services.
“Location based services, such as navigation and point-of-interest search for hotels and restaurants are becoming increasingly popular with consumers,” says Aage Snorgaard, Senior Vice President, Mobile Phones, Nokia. “With the introduction of the Nokia GPS Module LD-3W and through our collaborations with navigation industry players such as Wayfinder and Telmap, we offer a compelling range of location based services to the tens of millions of consumers who have one of our highly popular mid-range models, such as the Nokia 6230i or the Nokia 6280.”
And here's a very interesting PR from RFMD.
I believe that powerful, inexorable forces are converging in the near future to drive Microvision-inside devices into the hands of hundreds of millions of consumers around the world. When you really think about where personal electronics and communications devices are going, really what are the alternatives? Rollup, flexible screens? Well, maybe. That's kind of neat. But you just can't escape from that one element. There's a physical screen with specific dimensions, with so many pixels and so much real estate in the physical world to occupy, when unfurled. And it's not exactly a private, personal viewing experience.
The only concept that really makes sense, as far as devices to really unlock the content, consumer experience and profit potential of next generation networks, is Microvision eyewear with full color high-resolution displays that go from see-through augmented reality to occluded virtual reality as requested by the user.
We have new management imported from GE. We have new focus and are putting resources behind building a single, unified platform that can be embedded in any device that requires a video output to a user. The light sources are coming online. The electronics capabilities have never been better, and they've never accelerated at a faster rate than they do right now. This is the time when it all comes together.
Everything that MVIS longs have dreamed about for years is in sight, and is closer than it has ever been. But it's not just a dream anymore.
It is an operating plan.
Japan’s National Institute of Advanced Industrial Science and Technology (AIST) has developed a device that uses lasers to project real three-dimensional images in mid-air. The institute unveiled the device on February 7 in a demonstration that showed off the device’s ability to project three-dimensional shapes of white light.
AIST developed the projector with the cooperation of Keio University and Burton Inc. (Kawasaki, Japan). Until now, projected three-dimensional imagery has been “artificial” — optical illusions that appear 3D due to the parallax difference between the eyes of the observer. Prolonged viewing of this conventional sort of 3D imagery can cause physical discomfort.
The newly developed device, however, creates “real” 3D images by using laser light, which is focused through a lens at points in space above the device, to create plasma emissions from the nitrogen and oxygen in the air at the point of focus. Because plasma emission continues for a short period of time, the device is able to create 3D images by moving the point of focus.
At the demonstration, bursts of laser light were emitted 100 times per second to form shapes in the air up to 50 cm above the device. Heat from the laser caused the air to expand, producing a crackling sound that resembled a series of tiny explosions.
At the moment, the distance at which the device can project images is limited to between 2 and 3 meters. Improved laser technology will enable images to be projected at greater distances and with more color, so we may soon see 3D images floating above our city skylines.
The chief scientist at AIST’s Photonics Research Institute says, “We believe this technology may eventually be used in applications ranging from pyrotechnics to outdoor advertising.”
Somebody posted a comment that I hadn't given readers any feedback on the events of this week. So, without further ado, here we go:
In less than 5 months since joining the company as President and COO, and less than one month since being elevated to CEO and Director, Tokman has made huge strides to transforming Microvision into a high-performance organization. He is taking highly visible and effective steps to change the culture of the company to become obsessive about customer focus, cross-functional collaboration, quality, execution and shareholder value creation.
Tokman has consolidated the Sales & Marketing organizations and brought in another distinguished GE Healthcare leader to direct the combined organization.
He's created a Global Strategic Marketing and Business Development organization, headed up by Todd McIntyre to 'drive the global platform strategy and focus on applications across all key customer segments worldwide, driving key strategic customer relationships across the globe.'
He's correcting a lack of focus on international opportunities for the company and appointed Steve Willey as President, Marketing and Sales for Asia.
Tokman is demonstrating to Microvision shareholders that he will align our resources with our biggest opportunities. He will listen to the marketplace to find out what customers really need, and then profitably deliver a product that will meet those market needs.
While significantly cutting the company's burn rate and net losses in 2006, Tokman is tripling the R&D budget for the 'Microvision-inside' vision. During 2006, this vision is represented by focus on three products (the MicroHUD, PicoP personal handheld projector and Color Eyewear), and a new development effort on a modular, Integrated Photonics Module (IPM).
I personally believe that the market for wireless Color Eyewear cell phone displays, analogous to the the 'Bluetooth earbud' worn by many cell phone users, is an absolutely huge market. I am delighted that resources are being put to use by the company to evaluate that opportunity and potentially target that market with Microvision's technology.
The Integrated Photonics Module (IPM) could be the most significant part of the whole strategy. Microvision will be designing a modular, flexible platform that would include all of the critical elements of their light-scanning system (electronics, light sources, scanner, optics) in a micro-miniature design that would allow for rapid integration of the platform into various OEM product configurations.
The IPM will be the key to the global platform strategy. With a sufficiently flexible and miniaturized component-based architecture, Microvision will be able to insert the same light-scanning engine into any device with video output, and rapidly swap out electronics or optics components to achieve different capablities as required by the customer.
The Microvision-inside vision is something that MVIS shareholders have been very excited about for several years. Tokman is putting focus and resources behind that vision to accelerate the timelines, and with the development of the IPM, create a core platform that can be embedded and OEMed into mass-market consumer devices that sell hundreds of millions of unit volume annually.
It's compelling. It's tremendously exciting. It's top-tier GE leadership taking the reins of a company with an incredible technology. The opportunities are all there. Now the company's resources will be aligned in the service of the company's new vision: To become an indispensable source for illuminating information.
Indispensable, meaning absolutely necessary; essential. Core to the world as we know it. Mr. Tokman's vision and mission for this company is to change the world as we know it. I'm very, very excited about the new direction of the company and have never been more confident of a bright future for MVIS investors.
MVIS Blog is not responsible for transcription errors or omissions.
Microvision Business Strategy Conference Call
Brian Heagler: Welcome, introductions. Alec Tokman, President and CEO, Steve Willey, President, Marketing and Sales for Asia, Todd McIntyre, Senior Vice President Global Strategic Marketing and Business Development, Jeff Wilson, VP of Finance. Forward looking statements disclaimer.
Tokman: Good morning everyone. We're going to break this discussion into two sections. Start with reviewing preliminary earnings, spend most of the time talking about what we're going to do going forward. Q4 2005 revenue $2.7M. Revenue decline due to Ethicon development. $400k expected to move into 2006. 4Q characterized by our improvement in our ability to ship our product. We had one of the best quarters for bar code scanners ever. We shipped 70% more bar code scanner shipments than ever before. $14.7M total revs in 2005, 37% greater than in 2004. Operating loss for the year has improved 10% if you exclude Lumera, primarily resulting from higher revenue. In terms of Ethicon, despite technical difficulties on some deliverables, we're in positive and active dialogue with the customer. We are targeting to achieve all deliverables in Q2 2006.
Elements put in place to spearhead 2006 and beyond. Portion of the 3rd quarter and most of the 4th quarter, we conducted comprehensive assesment of MVIS business strategy, operational performance, organizational effectiveness and culture. Identified several elements to put foundation in place to enable growth in 2006 and beyond. Specifically, one of the major shifts in our position moving forward. We're going to focus on proactive strategic marketing. This implies that wew want to know what is happening in market, what are addressable opportunities that we can hit. We're putting a team together to enable this. Our priority for 2006 to consist of 5 key points.
1. Grow revenue and margins on our existing products.
2. Our breakthrough technology has been the reason everyone has been excited about Microvision for many years. This year, we're going to look at all opportunities available in front of us, focus on top 3-4 opportunities to give us the most bang for the buck.
3. Reduce the burn rate. Put a plan in place to allow us to reduce net operating loss in 2006 by 30%. Quality, whether it's transactional quality, or product quality has huge impact on ability to grow. Our assesment in 2005 has shown us that we have area for improvements on product side, delivery side and ability to define the right product. Customer centricity will become hallmark for our initiative moving forward. Performed restructuring which will be executed in the next several months.
Spend time on each one of these specific priorities and provide some more detail.
1. Growing product revenue and margins. We are expecting a very good year for FLIC. In 2006, we expect to grow the revenue by a factor of two. Place mechanisms in place to improve the product's gross margin by at least 15 percentage points. Spurred by very good teamwork to develop new channels in mobility, healthcare, household and traditional markets. Efforts by R&D and Manufacturing to improve quality of the product and add necessary functionality on software and application side. Q4 2005 strongest bar code shipment quarter to date, 70% more units than any other quarter before. Expect further growth in 1Q 2006.
Nomad, many of you know that we rolled out Nomad, targeting auto segment initially. We baselined what has happened, looked at our go-to-market strategy, targeted segment selection wasn't as optimal as it should have been. As a result, at the end of 4Q05, we modified strategy to move away from feet-on-the-street, now targeting strategic accounts with opportunities for higher sales volume. We come in from the top of the organization, not from the bottom. Attain mgmt buy-in up front. Looking for 2-3 targeted applications. Once we understand what these applications are, we're working with customer through workflow to understand requirements of the product to enable these applications. Work with the customer to quantify value proposition of product in their business and what is the $$ value of ROI to end user. Develop more effective sales tools that will focus on specific market segment, specific workflow. Nomad is not solution to all, it has to be adapted to specific workflow.
On R&D side, conducted comprehensive survey of Nomad users. Identified improvements on performance and quality. Mid-2006, several design and product enhancements will be in place to enable future growth. All of these steps that we put in place, we will expect these will considerably help us by turning the volume up and improving contribution margin. In 2005, due to quality issues, gross margin on Nomad was negative. Place emphasis to turn that around and ensure that Nomad has positive contribution margin.
2. Focus on vital few OEM opportunities. Focus on largest opportunities. Automotive HUD, Personal projection display, PicoP, identifying opportunities for color eyewear for consumer and business space. Targeting an increase in R&D budget for these opportunities. Triple R&D budget for these products. Accelerate the development of modular architecture, Integrated Photonics Module, that we expect will enable exciting opportunities.
Automotive HUD. Our goal is to sign large Tier 1 OEM agreement this year. We strongly believe in merit of this product. Microvision's technology offers three key advantages that our competition can not meet. Higher contrast, order of magnitude better than anybody else's. Better visibility in demanding operating conditions. Our technology enables form factor half the size anyone else can manage. This is important as OEMs try to fit HUD into tight cabin spaces. Because of the nature of the technology, it reduces the overall cost of the installation due to unique ability to electronically align the image to different windshields. Put together cross-functional business, engineering, manufacturing and sourcing team that will spearhead this effort.
Items number 2 and 3 are the personal projection display and color eyewear. We all know that mobile devices have progressed to the point that high quality digital content can be stored, downloaded and consumed anywhere and anytime. As a result of these advances, the conventional miniature screen of a cell phone, PDA, iPod and other devices is quickly becoming a limiting factor in the consumer experience. The consumer electronics OEMs are beginning to recognize this shortcoming and are eager to resolve it and they're looking at us to help them resolve it. The next generation Picoprojector can help them resolve it.
PicoP, talking in two specific applications. One is embedded solution for general consumer. Alternative to carrying bulky projector for business and sales presentations. Showed PicoP at CES. Based on positive feedback, we commenced formal effort and now aggressively pursuing strategic OEMs in Asia, with the goal to sign at least one agreement in 2006.
Color eyewear. Next generation color eyewear will offer the alternative of wearing versus carrying this personal display. It's the ultimate goal for head worn displays. Before we attack any one of these exciting applications, we're going to do a lot of market analysis. Looking at three applications that have their own requirements from the product.
1. Transmissive color modality eyewear. Walk around with, surf the web, answer your phone messages, do some light business applications.
2. Occluded display for streaming media consumption.
3. Occluded wide field of view display for immersive gaming and simulator applications. Take the next three months to do a very rigorous review of these opportunities. Look at all strategic partners, place cross functional R&D, manufacturing and sourcing team to start accelerating this effort.
In terms of gov't contracts, continue strong relationship. In addition to delivering solutions to them, we are retiring major technology risks on MEMS-based technology products, to leverage development for other applications, including business and consumer.
Item 3 is burn rate reduction. We're targeting 30% reduction in net operating loss. Does not include impact of (FASB123R) accounting for stock options. We expect to get 30% reduction in burn rate primarily from 2 sources. We placed foundation in place to start addressing negative gross margin on products. Improve quality, reduce variable costs. Implemented processes in marketing and sales organizations to add some rigor in how we price and discount our prodcuts. The second factor to contribute to reduced operating loss is reduce operating costs. Restructuring to allow us to reduce costs.
4. Quality and customer satisfaction. Understand customer's assessment of Microvision. How do they view us, where do we need to improve. We have to improve in many areas to improve the confidence of our customers today. How we sell our products, how we support our products after we sell them, how we transact. Last year we formed a customer support team and created service engineering and customer support group to address issue escalation in the field. Support all users around the world. Concurrently, we focused the R&D team to address some of the product quality gaps in FLIC and Nomad. We believe that these measures will have significant impact on the external perception as well as our internal cost of quality in 2006. Will enable us to achieve reduction in burn rate of 30% in 2006.
5. Realignment. We will be totally externally focused rather than inside-out. Biggest impact in marketing and sales side. New Strategic Marketing group, will be headed by Todd McIntyre. To drive global platform strategy and focus on applications across all key customer segments worldwide. After we looked at the financials, we found out that we are totally US centric. If you look at the applications our exciting technology will enable, most robust markets are located outside of US. High tech markets are in Europe and Asia. W're going to place stronger business focus in Asia. Steve Willey, will assume role of President Marketing and Sales for Asia. Steve will continue to cultivate his strong ties to Asian market for consumer applications and will also drive contract and product revenue and margin in that region.
We had some inefficiencies in how sales and marketing teams had been cooperating in the past. Streamline activities in our go-to-market strategies in the Americas and Europe. Consolidate and improve focus. We just announced leader for this group, Ian Brown has been distinguished marketing and sales leader at GE Healthcare for many years, brought exciting nuclear medicine. Will be great addition to the team. Ian, Todd and Steve will spearhead marketing transformation to improve growth position and allow us to move into other segments.
Second biggest change in R&D organization. R&D is lifeblood of this organization. We hadn't had focus on R&D team. We will substantially reduce the number of R&D developments from over 30 to under 10. Focus on 5 primary ones, 2 or 3 lesser funded programs if necessary. Will institutionalize a cross functional product development, will be an essential element of our success. Manufacturing, sourcing and marketing will be involved at the onset of product definition before we scale to production. Will pay strong attention to product cost, quality and schedule requirements. If we ceate brilliant solution to address unmet need in the market but can not do it profitably, we will not do it. We will have accountability to date commitments. Meet the date commitment as well as quality and cost commitment. Strategic sourcing strategy, essential to move forward.
One of the important activities that is the development of the MVIS-inside Integrated Photonics Module. We don't know yet what is the first blockbuster application that will spearhead our rapid growth. We need to be more agile, more responsive. We need to think such that the architecture we define is modular enough, that we can adapt easily based on new market demands that could come at any time. Reorganizing R&D team to focus on systems engineering. We're going to spend the next couple of weeks reorganizing R&D team, this will serve as the foundation for the growth platform. Search for a new leader to lead this important team. Todd McIntyre will lead R&D in an acting form as we search for permanenet replacement.
We got together and decided on several things. What do we want to be when we grow up, how to take it to the next level? Several initiatives to promote quality, cross-functional collaboration, customer focus. Establish accountability by driving company's goals and objectives throughout the organization. Recognize and reward people who meet and exceed their goals. Transform mgmt culture into leadership culture. People who are inclusive leaders, people who are open to someone else's ideas. People who promote cross-functional, boundary-less society. These are fundamental changes of the reorganization and the realignment. These are necessary steps to put us on a path to achieve our vision sooner.
The vision is to become an indispensable source for illuminating information. This is a bold statement -- we want to have Microvision-inside every display and imaging system going forward.
Jeff Harbey, Montgomery Scott: Longtime shareholder, delighted at changes: 1. Corning announced they're developing a new green laser, expecting it to be a breakthrough for microprojectors, cell phones. Is this a competitive technology, or is this something you can incorporate into your technology? Can't see cell phone displays in the sun, Microvision opportunity?
Tokman: Great comment. Green laser has been an element that kept us away from progress in Auto HUD product development. Recently, a lot has changed in last 6 months. Huge market pull for this technology due to demand for rear projection televisions. Low cost green laser technology targeted by numerous suppliers. We have confidence in the availability of this device.
Todd McIntyre: Green laser very encouraging, we view them as complementary, not competitive in any way, encouraged that companies like Corning are jumping in to answer the call of the market, we view it as something that's a highly positive development for Microvision.
Steve Willey: Focus on scanning element within our company, basis of our IP, relying on motivation of light source suppliers. Other market demands are having suppliers fund new light sources more aggressively.
Jeff: How many Nomads?
Tokman: 300 units total in marketplace (commercial). Commercial sales were disappointing. Implement different go-to-market strategy, assess viability of the market, correct negative margins problem. At mid-year, review our progress. In 3-4 months we'll know what the potential of the product is going forward.
Jeff: Are the customers happy with it in the automotive area?
Tokman: Some mechanics like the device and use it, some people are not finding it as useful. We need buy-in from business users as well as mechanics. Device needs to be simple, easy to use and present the right information with the right level of quality. End user value proposition, also business user value proposition. Create quantifiable ROI so that when we sell the product not about how cool the technology, but if you put this on one of your guys, it will save you $70,000/year. Now everything becomes a non-issue. It's in their interest to have this product. Need to go to top of organization, get the right product and ROI. Strategic accounts focused on different businesses: heavy truck, automotive, fleet maintenance opportunities. Could potentially sell hundreds of Nomads in each of these segments. Fleshing out 2-3 applications.
Jeff: Additional financing?
Tokman: We sold some shares in LMRA. First step in financing strategy, to be non-dilutive to shareholders. Longer term opportunity to ensure that we're not in the market several times a year. The goal is to raise enough money in next round to get at least through the year, and in the meantime show the improvement in results.
Jeff: What form would you like that to be?
Jeff Wilson: Looking at several different financing alternatives right now. Evaluating best option for shareholders.
William Despard, Smith Barney: Alec, delighted that you're there. FLIC, size of market, what is size of FLIC market for next 2 years?
Tokman: Traditional barcode market evaluated at $1B+ for barcode scanners, new emerging markets in healthcare, mobility and household applications. Ultimate size has not been established. What is the addressable market. Strategic roadmap, we'll be refining until April of this year. Expect significant growth in mobility and household sales in 2006. In terms of margin, gross margin on FLIC is to get it from teens to raise it another 15 percentage points. At GE, any business with gross margin less than 40%, that's a dog, usually sold or divested. Whatever segments we develop will be high margin.
Bill: Quality issues on FLIC?
Tokman: Address quality on every direction. R&D resources, redesign the engine, internal emphasis to screen bad units to ensure that customers receive high quality units. Full redesign of the product will enable high quality, high yield solution. In the meantime, until this release goes through, we need to spend more effort to inspect units that go out.
Chris Kelson, Paragon: Question relates to Picoprojector. Given there's a working prototype, what are the remaining challenges to come to market? Technological, or convincing customer to buy it? Can it be hooked up to a video iPod? Say you're in an airplane, shine the projection onto an 8"x11" sheet of paper instead of the 2" screen.
Tokman: Extension and accessory to video device. One of the applications is to project a small screen while traveling. Where are we on the development, what are risks. We developed a demo model, not even a prototype. Demo, internal prototype, external prototype to check with customer on performance, then decision is made to go to full pre-production and production. Took it to CES, was accepted very well. Demonstration model was attached to electronics sitting under the table. Specific risks, technical performance, risk related to image quality. Artifact called speckle, high frequency noise, when you look at the image, not as smooth as it should be. Development risk, determined by availability and buy-in from strategic partner. Steve has worked with several Asian mfrs who expressed strong interest in working with us. Look at all of these opportunities and evaluate which one will give us best success to market based on what they have been proposing.
Willey: Generic accessory, wired or bluetooth, handsets, multimedia players, such as video iPod, camcorders, PDA sized handheld computers, enormous portfolio of market segments for us. Working through the technical details now. Sourcing of appropriate components, including green laser. Where we sit today, unparalleled form factor, allows us the notion of a fully embedded projector. Competitive microprojectors are 500ccs in volume, our target is well under 100ccs.
McIntyre: Green laser is a critical component. Made it our business to be familiar with suppliers of green lasers around the world. Very encouraged that there will be the sources available. Approaching this from the standpoint of a projection platform. Want to drive greatest number of common elements between HUD and PicoP to maximize leverage from technology development. Strategy based on common platform elements.
Tokman: This is very important: the PicoP application as well as MicroHUD are based on the same projection display platform. Created Strategic Marketing group to ensure commonality of the platform for different applications. Same architecture for consumer applications that enables HUD, enables PicoP.
Alan Patterson, investor: Someone with the specific responsibility to beef up the website? Make it exciting to the public? More people interested and potential buying stock?
Tokman: We actually identified this as major development effort. Created IR Communications group. One of the first task is to update the website based on renewed strategy and operating plan. Put some horsepower this month to make it a lot more attractive.
Heagler: Working on proactive communications plan. Sometime in the next 30 days expect to see significant improvement there.
Alan: Plan to get the products in movies, articles?
Heagler: We'll continue to focus on that as well.
Rod Tracy, Paulson: Very ambitious plan, I'm impressed. I like that you're focused on high margins versus being spread all over the board. Thanks again.
Joe Dubrof, Morgan Stanley: Timeframe for commercialization for PicoP?
Tokman: Determined by two factors: How quick we can get large electronics mfr on board. We're providing an engine that will go inside something larger than what we provide. Need requirements. Until we have this, we can't fully place every resource to develop this. We're not going to wait for this to happen, so we focus on Integrated Photonics Module, Microvision-inside. Modular architecture, includes several critical electronics and optical components we can develop in the meantime. This year our goal is to sign one large strategic partner for PicoP.
Joe: Restricted by lack of volume of green lasers? Market sizes big enough to attract more rapid development?
McIntrye: Market opportnity for Picoprojector is the mobile device market. Enormous market all by itself. Suppliers are pulled by interest in laser based rear projection TV. That is utilizing a variety of different means of creating a laser display. Large market, pulling these companies along. We're part of that picture. These suppliers are not dependent on just us to pull them in that direction.
Tokman: In summary, this is going to be a turnaround year for us. Lot of changes, changing our executive mgmt team, realigning organization, new building, implementing a lot of core new business processes to serve as a foundation for growth. Focused on executing on operating plan, grow revenue and reduce operating losses. The second half is going to be very critical for us. Put in place elements in the first half, we should see some results from the efforts in the second half on the product side as well as on the OEM development and product development opportunities. Thank you for joining this call, look forward to getting together on our next presentation.
Experienced GE Manager, Ian D. Brown, Joins Microvision
BOTHELL, Wash.--(BUSINESS WIRE)--Feb. 7, 2006--Microvision, Inc. (Nasdaq:MVIS - News), a leader in light scanning technologies, announced today that it has named Ian D. Brown, 43, as its Vice President of Sales and Marketing. Mr. Brown will lead the new Sales and Marketing organization and focus on developing and driving Microvision's growth strategy in the Americas and Europe.
Mr. Brown joins Microvision from GE Healthcare, a subsidiary of General Electric, most recently serving as the America's Sales and Marketing Manager for its $100M+ Nuclear Medicine unit. Over the past few years, Mr. Brown has been responsible for defining and executing the "go-to-market" and commercialization strategies for Nuclear Medicine products in the Americas. Mr. Brown has been instrumental in three major product launches of Nuclear medicine cameras, the most recent being a small footprint product for cardiac imaging.
A significant part of Mr. Brown's 16-year career at GE Healthcare was spent in Europe, helping to lead the European deployment of its "At the Customer for the Customer" projects, using Six Sigma methodology to proactively analyze and implement process gains in clinical environments for patient comfort and departmental efficiency. Mr. Brown held Six Sigma roles as a certified Blackbelt and Master Blackbelt.
"We are very pleased to add Ian's experience and proven leadership to our sales and marketing team," said Microvision President & CEO Alexander Tokman. "During his distinguished career at GE, Ian has consistently shown the ability to define, lead and work with numerous cross-functional business teams to drive execution and quality throughout the organization. His customer centric marketing, sales and Six Sigma skills and healthcare experience will allow him to drive synergies across our new combined sales and marketing organization, strengthen our customer focus and position us well for future growth into the new market segments."
"I have been privileged to work with many exceptional people at GE. Leaving a company that excels at technology and process structure was not an easy decision," stated Brown. "However, Microvision is poised to bring a variety of breakthrough product solutions to the industrial, consumer and military marketplace and I am thrilled to be part of that future."
Labels: Alex Tokman
Microvision, Inc. 2006 Business Strategy Conference Call
Scheduled to start Tue, Feb 7, 2006, 12:00 pm Eastern
Stay tuned to MVIS Blog for full coverage of the 2006 Business Strategy Conference Call.
Company Establishes Five Priorities to Position for Turnaround and Growth
BOTHELL, Wash.--(BUSINESS WIRE)--Feb. 6, 2006--Microvision, Inc. (NASDAQ:MVIS - News), a leader in light scanning technologies, today announced key aspects of its 2006 business strategy and an organizational realignment and restructuring. In a separate press release issued today, the company announced its preliminary financial results for 2005.
"We are pleased to announce Microvision's turnaround strategy and actions including key elements of the 2006 operating plan which we developed over the past few months by conducting a comprehensive assessment of Microvision's business strategy, performance, organizational effectiveness and culture," said Alexander Tokman, the newly appointed President and CEO. "We had some significant wins in 2005; however, the Company needs improvement in a number of areas.
"2006 will be a rebirth year for us because we are implementing the fundamental business elements that separate successful from less successful enterprises. First among those are letting the market and customers drive our business priorities and investment decisions. We have developed and have begun executing a detailed operating plan that is intended to instill focus and accountability for everyone within the organization. Our 2006 priorities are to:
1. Grow product revenue and margins;
2. Focus on a vital few OEM product development growth opportunities, particularly in automotive head-up display (HUD) and two consumer display applications;
3. Substantially cut the burn rate and reduce the net operating loss by 30%;
4. Improve quality and customer satisfaction; and
5. Realign and restructure the company to improve organizational effectiveness and culture.
1. Grow Product Revenue and Margins
"In 2006 we expect to double bar code scanner revenue and improve its gross margin by at least 15 percentage points. In the third quarter of 2005 we positioned ourselves for a stronger fourth quarter by improving our marketing and sales effectiveness through new channel development, increased focus on improving product quality and performance by the R&D team and improved supply chain management. As a result, the fourth quarter of 2005 was our strongest bar code scanner quarter ever as we shipped approximately 70% more units than in any previous quarter in 2005. We expect further FLIC volume growth in the first quarter of 2006. Our marketing and sales strategy and growth opportunities are focused around four primary segments: mobility, healthcare, small business/ household, and traditional automated identification and data capture (AIDC) markets.
"Our assessment has shown that the original Nomad introduction was not as successful as planned due to the lack of targeted segment selection, less than desirable product performance and weak commercialization strategy. As a result, at the end of fourth quarter 2005 we modified our Nomad go-to-market strategy, moving away from the 'feet-on-the-street' sales approach to targeting a few strategic accounts with opportunities for higher sales volume. The new strategy emphasizes: (a) identifying targeted applications; (b) understanding the customer's workflow for these applications; (c) quantifying the value proposition and return-on-investment (ROI) to the customer; and (d) developing effective sales tools to communicate the value proposition and ROI. In the meantime we focused the R&D and supply chain teams on addressing several performance improvement areas identified through customer feedback in the second half of 2005. These and other efforts are expected to help us considerably in 2006 by turning the product's large negative gross margin into a positive gain for the product. We believe this overall approach to Nomad will result in a better market acceptance. At mid-year however, we intend to evaluate the longer term viability and true market potential of Nomad in its current configuration.
2. Focus on Vital Few OEM Product Development Growth Opportunities in Automotive HUD and Consumer Display Applications
"In 2006 we will focus our OEM product development strategy and execution on what we believe to be our three largest opportunities that we identified through our recently completed market analysis in the second half of 2005: automotive HUD; personal projection display (PicoP(TM)); and color eyewear for consumer and business applications. As a result, we are targeting an increase in the allocation of our R&D budget for these programs to approximately 42% from 15% in 2005. We will also accelerate the development of a modular architecture for an integrated photonics module (IPM) that we expect will enable future exciting product opportunities, including the following:
Head-up Display (HUD)
Our goal for this year is to sign an OEM agreement with a strategic Tier 1 partner to enable the development and productization of the head-up, windshield based color display for automotive applications. Microvision's technology offers three distinct advantages over the competitive solutions: (a) typically more than 10x higher contrast which results in a better visibility under demanding operating conditions; (b) almost 2x more compact form factor which is critical to automotive manufacturers in managing HUD integration into tight passenger cabin spaces; and (c) lower overall cost of installation due to Microvision technology's unique ability to electronically align an image to different windshields.
To fully enable this important effort, we have created, funded and engaged a cross-functional business, R&D, manufacturing and sourcing team. We have been in ongoing discussions with several Tier1 suppliers and we are working to have at least one of these suppliers commit to our unique solution during 2006.
Personal projection display - PicoP(TM)
Confined into a hand-held form factor, Microvision's unique high-resolution, high-contrast, low power display technology will enable two types of applications. For consumers, it will offer an alternative solution to the '2 inch screen' of their cellular handsets, PDAs and media players. For enterprise users, it will offer an alternative to carrying or needing a bulky projector for business and sales presentations.
We have invested engineering resources in the fourth quarter of 2005 to develop a feasibility demonstration model of the PicoP(TM) that was successfully shown at the recent Consumer Electronics Show (CES). Based on positive feedback received from the show, we commenced a formal cross-functional program team to aggressively pursue strategic OEMs and to focus on risk retirement of several technical requirements for this application.
Color eyewear is the ultimate goal for head-wearable displays. We have identified and will evaluate several potential architectures to determine which one will best meet the market opportunity with the lowest technical risk for one or more of the following applications:
Transmissive color mobility eyewear for light business, web surfing and phone messaging applications;
Occluded color display for video and streaming media viewing; and
Occluded color wide field of view display for immersive gaming.
In 2006, we will invest business and R&D resources to determine which one of our potential solutions best meets the markets needs.
We expect to continually evaluate the business opportunity in this market segment and evolve our business strategy accordingly.
We expect to continue our strong relationship with the US government to develop display solutions for military and non-military applications. We enter the year in a strong position for new government contract awards, and look forward to continuing our work with this important strategic customer.
3. Substantially Reduce The Burn Rate By Reducing The Net Operating Loss By 30%
"We are targeting a 30% reduction in our net operating loss for 2006 from 2005 (excluding the impact of the adoption of FASB 123R 'Accounting for Stock Options'). This is expected to be accomplished primarily through improved products gross margin and reduced operating costs. We plan to achieve better gross margins on products through better pricing and discounting strategies, lower product costs and improved product quality. We have started to implement the business restructuring plan discussed below to significantly reduce our operating costs.
4. Improve Quality & Customer Satisfaction
"Based upon our detailed quantitative customer assessment of product performance, transactional quality and post-sale support completed in the second half of 2005, we have initiated product quality improvement activities through the implementation of more rigorous and customer focused processes. We formed a customer support team and implemented an issues escalation process to provide timely and effective support to our customers worldwide. Concurrently, we focused the R&D team to address Nomad and FLIC product quality gaps. Quality and customer centricity are hallmarks of my experience at GE, and we will be instilling those strategic imperatives at Microvision.
5. Realign and Restructure the Company to Improve Organizational Effectiveness and Culture
To improve organizational effectiveness, focus and culture we are implementing an organizational realignment and restructuring program which includes the following actions:
Reorganized the executive management team and made it leaner. 50% of executive management (including Marketing, Sales and R&D) have been or are being replaced and 30% of executive positions have been eliminated through consolidation.
Reduced the overall workforce by approximately 10% primarily in the Nomad sales and manufacturing and executive teams. Overall SG&A costs are expected to be reduced by approximately 25% in 2006 versus 2005.
Consolidated the marketing and sales teams to streamline activities and go-to-market strategies in the Americas and Europe to focus on key customer segments including: enterprise, consumer, industrial and government. We will announce shortly the leader of this combined group.
We will be placing stronger business and organizational focus on exciting international opportunities in Asia. As a result, Steve Willey will assume the role of President, Marketing and Sales for Asia. Mr. Willey has developed strong business ties to the Asian market for consumer applications and he will be responsible for driving strategic relationships as well as product and contract revenue in the region.
Created a new strategic marketing group, headed by our former SVP of Business Development Todd McIntyre, who will assume the role of SVP, Global Strategic Marketing and Business Development, to drive the global platform strategy and focus on applications across all key customer segments worldwide. In this expanded role, Mr. McIntyre and his team will also be responsible for driving key strategic customer relationships across the globe.
We are reorganizing the R&D team to: (1) substantially reduce the number of R&D programs from 30 in 2005 to under 10 in 2006; (2) institutionalize new cross-functional product development discipline predicated by proactive involvement of all key functions at the onset of product definition and development. This discipline is inclusive not only of meeting critical product performance requirements but also product cost, quality and schedule requirements; (3) focus on the development of an IPM that will accelerate our embedded solutions strategy; and (4) improve and grow the critical skill mix. We are pursuing new product focused leadership to head this critical team.
Introduce strategic sourcing discipline aimed at insuring that we identify and qualify all critical component suppliers early in the product development cycle.
Most importantly, we are implementing cross-company initiatives to create a culture that promotes customer focus, cross-functional cooperation, quality mindset, transparency and accountability. We are establishing accountability by driving the company's goals and objectives throughout the organization. We will recognize and reward those who meet and exceed their goals and drive the Company's success. We will cultivate and promote people who lead positive change.
"In summary," concluded Tokman "we are putting in place the necessary foundation that will put us on a path to achieve the recently updated Microvision's vision 'to become an indispensable source for illuminating information and a profitable enterprise with sustainable double-digit growth.' We look forward to discussing our plan with you in more detail during the upcoming conference call."