When David Knowles describes how San Diego-based Cymer’s complicated laser system is used in flat panel display production, he turns to the Zamboni.
Like the Zamboni, which smoothes gashes from ice in a hockey rink, Cymer’s laser levels out powdery silicon that coats the back of flat panel displays. The silicon is needed for electronic circuits that control the pixels in the screen, telling them when and how much light to give off to display a picture.
“You have this snowy form of silicon. It’s rough. Making a circuit on it is fairly challenging and not very high performance,” said Knowles, general manager of Cymer’s TCZ Product Group. “We are effectively the Zamboni that goes over this. We melt it. It comes out very smooth, more crystalline. Once you crystallize it, the electronic properties are 100 times better.”
After more than six years of development, Cymer is finally starting to get traction with its TCZ tool. It has delivered two TCZ machines to display makers so far and has orders for two more.
TCZ is finding a niche because more smart phone and tablet computer makers are demanding high-resolution screens capable of showing high-definition video. The trend highlights how mobile phones and tablets — not TVs — are leading the innovation wave in flat panel displays.
Thinner, lighter and higher-resolution screens are important for smart phone and tablet makers to attract consumers to buy their devices. While those features are key for TV makers, too, they are more challenging and expensive to manufacture in larger screen sizes. And consumers are very sensitive to price in the hotly competitive TV market.
“At the end of the day, this is about the higher quality of the screens and higher (production) yields” for manufacturers, said Ben Pang, an analyst with Caris & Co in San Francisco. “The screens are one of the few types of electronics where you can’t tolerate any defects, so the fact that Cymer is offering technology which increases the yield gives it legs.”
Since it was founded 25 years ago, Cymer has made lasers that help etch microscopic circuit patterns on silicon for semiconductor chips. Each of these lasers is like a science project, hulking in size and complexity. The company’s most advanced machines cost well over $1 million each.
Eyeing other markets
In 2005, Cymer began to diversify into other markets, mainly flat panel displays. The company teamed with German optics company Carl Zeiss to form a joint venture called TCZ, or Team Cymer Zeiss. Cymer bought out Zeiss’s 40 percent interest in the joint venture last year.
At first, TCZ targeted the next generation of ultrathin displays — called Organic Light Emitting Diodes — as the key market for its laser system, which would fill a living room. The machines cost $7 million to $15 million each and sit on a huge block of granite for stability.
The trouble was OLEDs have been slow to come to market. They are used in certain smart phones, such as the Samsung Galaxy S and HTC Droid Incredible. Supplies are limited, however.
Vinita Jakhanwal, a principal analyst with industry research firm IHS iSuppli, said OLED offers several advantages over liquid crystal display screens that are widely used today. That’s particularly true for smart phone makers. They use less power than LCDs in many uses. They’re thinner and lighter. They appear more vivid.
But OLED production is still tricky, she said. Samsung Mobile Displays is the only flat panel company with significant capacity to make OLED screens for cell phones at this time. Other screen makers are focusing on LCD screens for now.
But these LCD makers also are pushing to make their screens as robust as possible for smart phones and tablets. And Cymer has seen interest growing from display makers in using TCZ technology to make the highest-quality LCD screens for mobile devices.
These more advanced LCD screens have extremely dense pixel concentration — 200 to 300 pixels per inch — which offers consumers high resolution for watching video or playing video games.
To get that level of resolution, screen makers must use a poly-crystalline process to melt the silicon on the back of the glass to improve the electrical qualities.
“When we first launched TCZ we were targeting purely OLED displays, and it wasn’t until a year or so ago that we started to see there was interest growing from the LCD side as well,” said Robert Akins, Cymer’s co-founder and chief executive.
Smart phone makers are turning to these displays as a way to stand out from competitors, said Jakhanwal, the IHS iSuppli analyst. Apple’s iPhone 4 led the charge with its “Retina” LCD display made by LG that offers four times the pixel density as previous iPhone models, or 326 pixels per inch.
“If the apps that are running on Android (Google’s software) are the same ones running on iOS (Apple’s mobile operating system,) you need the devices to portray your product differentiation,” Jakhanwal said. “The display is the first thing that comes into contact with the user.”
Returns on investment
Cymer won’t reveal its customers. But it will say that one TCZ system is installed in a pilot production line in South Korea. The second is in a research and development lab at a display maker. It has received orders for two more TCZ machines for delivery this year, with options for two additional machines in 2012.
“You’re now getting volume production orders, so from that standpoint it has found its niche,’ said Patrick Ho, an analyst with Stifel Nicolaus in Dallas. “Companies are always trying to find new revenue and earning growth. Not all of them are going to be home runs. I know Cymer is not telling Wall Street that this is a home run. It’s a single. But it’s finally starting to get some returns after five or six years of investment.”
Ho expects TCZ sales will amount to something less than 10 percent of Cymer’s total revenue in the next couple of years.
A tricky technical hurdle in making OLED and advanced LCD screens involves melting the silicon layer on the back of the glass without overheating the glass. If the glass gets too hot, it can warp into the shape of a potato chip, making it useless.
TCZ has developed a way to heat the silicon without raising the temperature of the glass significantly, said Knowles, the general manager of TCZ. The process involves using a Xenon-Fluoride laser.
Cymer claims its expertise in building lasers for semiconductor production has enabled it to make TCZ machines that are durable and highly reliable in the production line.
Knowles added that the cost per screen for manufacturers is 20 percent to 30 percent less using a TCZ laser than existing laser systems. Moreover, TCZ can perform the most advanced poly-crystalline process, thereby creating the smoothest silicon surface and best electrical properties.
Its competitors have yet to reach this level of smoothness with their technology, said Knowles.
But convincing display makers to adopt new technology remains a long process.
“Display makers are like surgeons. If something works, don’t screw it up, at least on the production side of the house,” said Knowles. “So they tend to be a little conservative.”
But Cymer hopes as more TCZ machines are used in manufacturing advanced, high-resolution LCD screens, their value will be proven and they’ll migrate over the OLED production as it becomes more popular and manufacturing techniques are more refined.
“The transition from advanced LCD to OLED is a small step,” said Knowles.
2005: San Diego-based Cymer joins with Carl Zeiss called TCZ, or Team Cymer Zeiss, for a joint venture to improve low-temperature poly-silicon processes for the flat panel display manufacturing. Cymer owns 60 percent of the joint venture, while Zeiss holds 40 percent.
2006: TCZ gets its first patent on the process for using a thin-beam, low-temperature laser to crystallize silicon as part of flat panel display making.
2006: TCZ moves its global headquarters to Singapore so it can be close to flat panel display manufacturers in Korea, Japan, Taiwan, China and other technology centers in Asia, where most flat panel display production occurs.
2007: David Knowles, a longtime Cymer employee with a doctorate, is appointed to lead TCZ.
2009: TCZ receives its first order from a large Korean display maker for a production system, which uses patented laser crystallization technology.
2010: Cymer buys out Carl Zeiss interest in the joint venture. Zeiss is still a key supplier of the optics used to stretch the laser so its beam more efficiently passes over flat panel displays. A second TCZ system is installed at a display maker.
2011: Cymer announces TCZ has orders for two more TCZ systems for delivery this year with an option for two additional systems in 2012. The purchasers are not disclosed.