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Technology Stocks : THREE FIVE SYSTEM (TFS) - up from here? -- Ignore unavailable to you. Want to Upgrade?

To: Subman who wrote (1320)	4/11/1998 3:21:00 PM
From: michael c. dodge	Read Replies (2) \| Respond to of 3247

Thread: The optics are the cost driver in these virtual image displays, not the LCD engine. Note the oblique reference to a rear-projection development contract....i.e.: computer monitor, thin TV, or POS display. Cellphones would be enough. mcd Three-Five Systems buys startup's technology in liquid-crystal-on-silicon bid -- Display maker takes new tack on mobil gear David Lieberman 669 Words 4820 Characters 04/13/98 Electronic Engineering Times 14 Copyright 1998 CMP Publications Inc. * Tempe, Ariz. - Three-Five Systems Inc. has bought the right to use backplanes and optics from startup Siliscape Inc. (Palo Alto, Calif.) in a deal aimed at making Three-Five a player in the nascent market for miniature liquid-crystal-on-silicon (LCOS) displays in cellular phones and other mobile devices. Under the terms of the deal, Three-Five has bought about a 20 percent stake in Siliscape and the two have signed a cooperative technology agreement. "We provide them our manufacturing and process capability and they supply us the rights to use their backplane and optics," said Three-Five chief executive officer David Buchanan. In display parlance, "backplane" refers to the active-matrix (AM) silicon circuitry that controls the display and sometimes provides a reflective surface. A 1994 startup, Siliscape gains much-needed cash and a partner with LCD and packaging expertise, an established customer base and a sizable manufacturing capability. Three-Five, an established, high-volume maker of custom LED displays and low-information-content passive LCDs, gains quick entry into a new market segment. Eight months ago, Three-Five hooked up with National Semiconductor Corp. for cooperative development, manufacture and marketing of minidisplays for the projection arena. "Analysts say that 230 million cell phones will be built in the year 2000, and potential [cellphone-vendor] customers tell me that at least 15 percent of those will have the kind of high-information-content [miniature] displays we're talking about," Buchanan said. "A little quick math says that's about 35 million displays, which will probably sell for between $50 and $60, which means there will be about a $2 billion market in two years, and Three-Five would very much like to be a part of that." The theoretical advantage of miniature displays in so-called personal viewers for cell phones, portable Web browsers, wearable monitors, etc. is compelling: the generation of large "virtual" images from very small, lightweight, low-power, low-cost devices. While today's cell phones are limited to one to six lines of alphanumeric text, the minidisplays would bring imaging capabilities up to those of a desktop monitor with SVGA or better resolution and full graphics capability. But display analysts quickly note that this potential has yet to be proven in real-world products. David Mentley, director of display-industry research at Stanford Resources (San Jose, Calif.), said, "We have a couple dozen miniature display developers with technology that is not quite refined chasing a market that still lacks a killer app that will support tens of millions of units. No one would deny that there is great appeal to use silicon as a high-resolution imaging device, but there are many other components that must be co-developed in order to build a workable product." Originating in 1985 as a management buyout of National Semiconductor Optoelectronics Division, Three-Five today is a public company. It reported $84.6 million in revenue in 1997 and $8.2 million in profits, up from $60 million in 1996 and a $7 million loss. The company gained entry to AM LCDs last fall through an agreement by which it receives finished wafers full of backplanes or "display chips" from National, then processes and packages them into complete miniature-display systems using conventional twisted-nematic (TN) liquid-crystal material. Devices are rolling out the door now "in small prototype runs and samples for a number of companies," Buchanan said. "We just signed a development contract with a major international company in projection, though not necessarily front projection." What Siliscape brings to the show is a unique set of compound magnification optics (see June 23, 1997, page 37) that Buchanan said "provides a wide field of view as well as significant eye relief in an incredible thin package." Siliscape has also developed its own display chip specifically targeted at handheld devices, an all-digital chip with a significantly slimmer power diet than National's chip, which includes analog circuitry to accommodate conventional PC and TV inputs. A one-half-inch-diagonal LCOS display made with the Siliscape chip "has the lowest power consumption we've seen," Buchanan said: "10 mW or less in power-miser mode." Buchanan said that LCOS displays incorporating Siliscape technology will sample soon. I0607 * End of document.