Dow Jones Newswire: Handsets May Sport Tiny Projectors

By Roger Cheng Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)

For people who can't resist showing off their family vacation photos, the development of new high-tech lasers may allow cell phones to project pictures and videos on the wall like an old-fashioned slide show. Technologists have long struggled with the dilemma of balancing the consumer's desire to keep images large and clear even as the devices that display them - like handsets or personal digital assistants - slim down. One answer would be the ability for those devices to project images and videos on a large flat surface, allowing someone to run a PowerPoint presentation or show off their photo gallery straight from a handset. As a result, it eliminates the need for a larger, space-consuming screen.

Microvision Inc. (MVIS) unveiled a working prototype of the tiny projector at the Consumer Electronic Show in what it hopes to be a lucrative new business for the maker of scanning technology. The company hopes to have a plug-in projector by the middle of 2008, with embedded projectors in cellphones by the end of that year.

Microvision's PicoP projector, roughly the size of a Thin Mint, will add roughly $100 to the price of a cell phone. It's expected to be able to run at least one to one-and-a-half hours on a normal battery charge. One of its key features, dubbed Infinite Focus, allows the projector to display a clear image between two feet to 10 feet away, as well as on curved or distorted surfaces. Images range from the size of a laptop screen, or 30 inches diagonal, to the size of a plasma screen television, or 100 inches. While this could mean big business for Microvision and other projector makers, for now it remains in the developmental stage. Insight Media, a Norwalk, Conn., market research firm focused on the display industry, projects sales to ramp up to nearly 5 million units by 2009 as the costs come down. That figure could jump to nearly 15 million by 2011.

Microvision isn't the only company working on a tiny projector. Others include Motorola Inc.'s (MOT) Symbol Technologies and Israeli company Explay Ltd.

"The goal is to provide mobile users with a large screen anywhere," said Microvision Chief Executive Alexander Tokman. He added the market could be huge if it could just capture a sliver of the explosive market for high-end cell phones. Both Nokia Corp. (NOK) and Sony Ericsson, a joint venture between Sony Corp.(SNE) and L.M. Ericsson Telephone Co. (ERIC), projected industry handset sales well above 1 billion this year, with high-end phones such as Apple Inc.'s (AAPL) recently unveiled iPhone among the fastest growing areas.

While Tokman is optimistic, it's still unclear how consumers will accept it. "It's one of these cases that if they build it, they'll hope they'll come," said Chris Chinnock, president of Insight Media. "Consumers don't know about this. This clearly could be a big hit, but it could be a big flop." Microvision is talking with four of the top five handset makers about the projector. "The cell phone companies have been looking for solutions, but no one has been able to make the display technology," Tokman said.

The difficulty lies in producing full-color images, which require a projector with lasers that use the three primary colors: red, blue and green. While much work has been done on developing red and blue lasers are now being utilized, there has been less progress on green laser technology. Without a source of green, no images could shown in their true color. Enter companies such as Corning Inc. (GLW), Germany's Osram GmbH and Novalux Inc. The companies are each developing green lasers. Corning, in particular,is using technology based on its experience in the telecommunications equipment business. "The foundation of our approach was to use technology we developed in thetelecom phase for creating high-powered infared light used for telecom components," said David Charlton, who is in charge of developing early-stage technology projects which could lead to new businesses for Corning. He calls green lasers the "keystone component" to a true projector. Companies are exploring the use of lasers because other alternatives such as light-emitting diodes are less accurate and consume more power. The green laser Corning is developing, for example, converts electrical power to light more efficiently, Charlton said.

The idea of projecting images has been around for a while, but the problem of power consumption has always been a hurdle forthe adoption of the technology into smaller devices. Corning is currently demonstrating its green laser to consumer electronic companies and original equipment manufacturers to get a sense of the demand for a projector. It's likely a manufacturer would bundle the green laser with the red and blue ones from other suppliers to create the projector. The combined projector flashes the lasers on and off extremely quickly, effectively painting a picture in space. Charlton compared it to waving a flashlight on the wall from side to side quickly to create a picture. In addition to cellular phones or personal digital assistants, the companies envision small projectors in cars for heads-up displays on the windshield or in digital cameras. In the past, Corning has said the market for green laser technology - if successful - could be worth several hundred million dollars.(Roger Cheng covers the telecommunications industry for Dow Jones Newswires.)

-By Roger Cheng, Dow Jones Newswires; 201-938-2020; roger.cheng@dowjones.com