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This block diagram of the "Interactive PicoP" was posted to the MVIS Reddit a few days ago. The items marked in GREEN appear to be MVIS proprietary components.

Vertical Licensing Strategy & Components Synergy

The company has established a licensing strategy based on the use case or application of their technology, rather than the components themselves. This strategy allows the company to leverage the exact same component into differentiated vertical solutions, with each vertical having potentially one or more licensee. 

If we look at the recently announced display-only license agreement, we can see that the company receives a $10M upfront payment for the exclusive license to manufacture and sell MVIS modules for display-only applications. The key phrase in the announcement is this one (emphasis mine):

“We believe our licensee's manufacturing prowess and use of our Laser Beam Scanning technology will assist MicroVision in lowering product costs and securing new customers in the other verticals that we serve.”


The proprietary components in the Interactive Projection application include:
  • MVIS MEMS Control & Laser Feedback ASIC
  • MVIS Video ASIC
  • MVIS Time of Flight ASIC
  • MEMS Mirror
The remaining aspects of the solution such as the laser diodes, photodiodes, power management chips, etc. we can consider to be off-the-shelf components, available from various sources. 

MVIS' proprietary components in the Display-Only applications include:
  • MVIS Video ASIC
  • MEMS Mirror
  • MVIS MEMS Control & Laser Feedback ASIC
So, 3/4 of the MVIS proprietary components are the same between the Interactive and Display-Only PicoP, with only the MVIS Time of Flight ASIC being the difference.

(It stands to reason that the Display-Only and AR solutions include largely the same set of MVIS components but it's possible they may add some new proprietary components specific for AR).

Now I'm not sure what's going to be in the LIDAR solution, but if I were to guess I'd say it doesn't need the MVIS Video ASIC as the LIDAR module's primary function is to generate "beautiful point clouds" rather than interpret an external video source.

So that would mean that MVIS' proprietary components in the LIDAR applications include:
  • MEMS Mirror
  • MVIS MEMS Control & Laser Feedback ASIC
  • MVIS Time of Flight ASIC
So what this boils down to is that 75% of the MVIS components are the same between Display-Only and Interactive Projection. And this means that volume sales of those MVIS components to the Display-Only licensee will create significant cost reductions for Interactive Projector licensee(s) and for the OEMs that go-to-market with both flavors of MVIS solutions.

Likewise, the MEMS Mirror and MEMS Control & Laser Feedback ASIC that is inherent in all of the solutions will be 100% synergetic as all of the vertical markets will use those components. So the LIDAR solutions will benefit from the adoption of Display-Only, Interactive Projection and AR solutions by collectively driving cost out of the MEMS and MEMS Control elements of the solution.

Deal Template

So, this is all good, and these benefits will accrue to all of the go-to-market partners. We can also consider the previously mentioned Display-Only exclusive license as a potential template for deals in the other verticals.

The established template looks like this:

Application: Display-Only ($$$)
Term: 5 years worldwide exclusive
Upfront License Fee: $10M
Minimum Volume Requirement: $15-20M/year in MVIS product revenue (as described on the Q1 conference call). That $15-20M per year of sales will apply to the MVIS Proprietary components in the Display-Only solution:
  • MVIS Video ASIC
  • MEMS Mirror
  • MVIS MEMS Control & Laser Feedback ASIC

Thought Exercise

We have seen that the Interactive Projection solution is the big kahuna for the 2019 "probable" revenue, rated at "$$$$" vs "$$$" for Display-Only. The note on the slide says the $ signs are 'directional and not scaled', so here is a thought exercise using the established template from the Display-Only license deal, and the quantity of dollar signs on the slide as direction for the other applications they are ready to market in 2019:

Application: Interactive Projection ($$$$)
Term: 2 years worldwide exclusive
Upfront License Fee: $20M
Minimum Volume Requirement: $20-26.66M/year in MVIS product revenue. That $20-30M per year of sales will apply to the MVIS Proprietary components in the Interactive Projection solution:
  • MVIS Video ASIC
  • MEMS Mirror
  • MVIS MEMS Control & Laser Feedback ASIC
  • MVIS Time of Flight ASIC
Application: Consumer LIDAR ($$)
Term: 5 years worldwide exclusive
Upfront License Fee: $6.66M
Minimum Volume Requirement: $10-15M/year in MVIS product revenue. That $10-15M per year of sales will apply to the MVIS Proprietary components in the LIDAR solution:
  • MEMS Mirror
  • MVIS MEMS Control & Laser Feedback ASIC
  • MVIS Time of Flight ASIC
This deal trifecta, if it were to happen according to the established template, with the relative directional sizing, would result in total upfront license fees of $36.66M, and minimum product revenue of $45-65M/year, driving volumes across the four proprietary MVIS components, well into the millions.

But, it's just as important to have the right licensees as it is to have a smart strategy, so coming out of the gate here, a lot depends upon who this unnamed-for-now Display-Only partner may be, how motivated they are to make their $10M investment pay off, and how strategic the MVIS solution is to their business. 


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