Some thoughts about MVIS after its strategy change

On Feb. 15, 2011, Microvision announced new business strategy by shifting product development to alliance partners or ODMs. Instead, it will focus on the advanced development for future pico projector. It also predicted the availability of PEK sampling with DGL inside in the coming Q3. Through the above arrangements, it is looking to lower the cash used in its operations in 2011 by approximately 40 percent.

    As an investor, here is a list of  events we should be closely watching:
   

(1) The Q3 availability of PEK sampling with DGL inside coincides with what I have in mind as the 5000-hour reliability test which probably started in either Dec. 2010 or Jan. 2011 when Soraa announced its latest advancement of DGL technology. We want to make sure it's on track.

(2) The slim-down of the company is either prepared for acquisition target or staying in a dormant mode. Since I don't see any "Shareholder rights plan" or "poison pill" in place, so "buy-out" is obviously an option although DGL's era is just less than a year away. As far as "dormant mode", as long as MVIS can receive another round of financing or  support from equity partner. It will be staying in that mode for a while until the cloud is cleared.

(3) The new burn rate per quarter is about 9 millions. Considering MVIS only has 21 millions before last quarter, after the deducting the 15 millions which just announced, only 6 millions cash left. Therefore, Microvision will need another round of financing in the coming weeks.

     For  an individual investor, what should we do at this point? Here are some suggestions:

(1) First of all, do you think Microvision will go bankruptcy? Personally, I don't think so. In worst case, it could be a buy-out target with $3~$5/shr at a minimum. If more than one bidders come into play, it could go up to $10/shr.

(2) If you have any other better short-term investment target, you may want to consider to exit now as PPS will be pressured until another catalyst such as the official Q2 release of NionCom's high end media player with PicoP inside.

(3) If you still believe MVIS can survive in the long run. Buy more when the dust settled down. The best entry point is probably when the daily trading volume falls into the range of 200K~500K. This is  what I am planning to do.

Microvision patent portfolio (Part4 - Possible patents from Motorola's Symbol unit)

There is no public information on what patents Microvision obtained from Motorola's Symbol unit on Nov. 5th, 2010. With some better guess to search the US patent office, we can still find a possible list of those patents. With  search criteria (AN/symbol AND (("scanning" OR "laser") AND ("projection" OR "projector"))) at the US patent office website, the search result is 179 patents.

The more I dig into these patents, the more exciting and comfortable about the prospect of Microvision. I am surprised to see there are so many innovative patents in the possible offerings. Here is the list :

(1) Patent No 7845801 : Multiple control data interface between different hosts and controller for an image projection arrangement

Field of invention  :  "The present invention generally relates to an image projection arrangement and, more particularly, to simplifying integration of a controller for the arrangement with different types of hosts by giving a plurality of choices for the type of control interface that can be used between a host and the controller. "

This is possibly the most important patent Microvision acquired from Motorola's Symbol unit. Why? Let me explain this to you. Imagine no mater what host interface is, your pico projector can adapt to the different host interfaces and essentially replace all of the existing display devices.
For example, an hand-held host ( a networked navigation system such as Androoid cellphone, or a gaming unit ) to be connected to the built-in in-car laser projector ( like Pioneer's HUD ).
Or an hand-held host ( smart cellphone or a gaming unit ) to be connected to an built-in laser projector eyewear device.

This is probably why Pioneer signed deal with Microvision right after MVIS acquired the patents from Moto's symbol unit. Only one sentence can describe it : The possibilities are endless. In my opinion, the value of this patent alone is much more than the whole deal.

Analogy of how projector can be applied in a similar fashion

Pioneer automotive HUD demo

(2) Patent No 7425073 : Method and apparatus for conserving power in a laser projection display
Here are some excerpts from the description:

(A) Describe how to conserve power in a two mirrors laser-based projector design but a single mirror design can also apply the similar path.

(B) A light detector in the LPD can be used to sense the ambient lighting conditions, and can reduce the laser brightness when the ambient lighting conditions are low. 

(C) Power may also be conserved by designing the laser characteristics so that the optimum laser efficiency is obtained at a temperature higher than ambient (room temperature). This will save energy by minimizing or eliminating the need for a thermoelectric cooler. The temperature can be controlled by use of a heating element.

(D) The laser modulation for setting the brightness of any displayed pixel can be achieved by pulse width modulation. This will save power by turning each laser current completely off and on so that the laser consumes no power when the pixel is dark. If pulse width modulation is not used, then the laser current will be modulated to a low level when the pixel is dark. In this case, the laser current can still be turned completely off when it is known that there will be a long dark row of pixels in the display, and turned back on before the next bright pixel.

(E) Security or Anti-piracy: The LPD can have an additional infrared laser included. The infrared laser would be invisible to the human eye, but visible to a camera. This method could be used to obliterate the projected image, to prevent photographing. This would add security to sensitive information, or prevent movie piracy.

(F) Laser Pointer/Mouse : A specially designed laser pointer can be used to interact with the LPD image.

(G) Common Electronics : For multi-screen LPD applications, two or more laser projector modules could share some electronics.

    This is a very interesting patent which covers not only some of the techniques Picop uses currently, but also future potential applications.
   
(3) Patent No 7302174 : Method and apparatus for capturing images using a color laser projection display

One interesting part of the patent is that "Touch screen" input can be implemented. The laser projection display projects "icons" on a screen. The product has a photodiode that captures the scattered laser light during a frame, and the processor remembers where the icons are in the frame. A user can touch a particular icon on the screen with his/her finger. The photodiode and electronics in the terminal senses the change in the reflected light in that area and knows that particular "icon" was selected. Hence, the laser display is inherently a "touchscreen."

(4) Patent No 7273281 : Method and apparatus for aligning a plurality of lasers in an electronic display device

This precise alignment for multiple lasers is difficult to achieve in mass production and accuracy over distance is also an issue. The invention is directed to overcoming, or at least reducing, the effects of one or more of the problems set forth above.

(5) Patent No 7163294 : Method and apparatus for providing an interface between a liquid crystal display controller and a laser projection display

This patent is to use existing Liquid Crystal Display (LCD) controller to drive Laser Projector Display (LPD) to save money and time.  In my view, the same thing can be applied for LCD TV. What a brilliant idea! The market is huge.

(6) Patent No 7425073 : Method and apparatus for conserving power in a laser projection display

LPD can be used by momentarily turning off the lasers to measure only the ambient lighting conditions.

(7) Patent No 7857219 : Imaging reader target object finder system
This is to utilize a strategic search routine for locating a target object.

(8) Patent No  4607156 : Shock-resistant support structure for use in portable laser scanning heads
This is an import patent especially for the in-car HUD to be more shock-resistant so that the  reliability of the projector system is higher.

(9) Patent No 7815119 : Monitoring scan mirror motion in laser scanning arrangements
This is to detect mirror error in a two mirrors system for fault detection.

(10) Patent No 7665852 : Arrangement for and method of projecting an image with safety circuitry
This is another one for the safety of laser-based mirror scanning pico projector.

(11) Patent No 7566004 : Method and apparatus for extending the range of a product authentication device
This is an invention for anti-counterfeiting technology

(12) Patent No 7302174 : Method and apparatus for capturing images using a color laser projection display
Other than capturing image, it may also be used to display the picture, to operate as a viewfinder, to print the picture, to operate as a range finder, and the like.

Microvision patent portfolio (Part 3 : interesting patents in application)

In the US, usually it takes 3~5 years to get patent approved. For Microvision, there are 106 patents application still in the pipeline. Here is the list of patents in application that provoke my curiosity.

(1) Patent in application Serial No. 11/761908, Title : "SPATIALLY AWARE MOBILE PROJECTION"

Abstract : "A spatially aware apparatus includes a projector. Projected display contents can change based on the position, motion, or orientation of the apparatus. The apparatus may include gyroscope(s), accelerometer(s), global positioning system (GPS) receiver(s), radio receiver(s), or any other devices or interfaces that detect, or provide information relating to, motion, orientation, or position of the apparatus."

All kinds of sensors and receivers are mentioned in this patent. Motion or position or orientation of the mobile projectors is/are sensed, feed back to the processing unit, then processing unit send display data sent to the coupled mobile projector.It can be applied in scenarios such as navigation, gaming and medical practice. This is one of most important patents for the interactive projection as of today. Sounds very promising.

(2) Patent in application Serial No. 12/134731, Title : Mobile Virtual Reality Projector

Claim (A) "produce left and right display images that when combined produce a stereoscopic image; and a spatially aware processing device to cause the stereo projection apparatus to change the stereoscopic image based at least in part on movement of the stereo projection apparatus"

Claim (B) "at least one sound output device comprises a stereo output device, and the spatially aware processing device is operable to modify sound produced by the stereo output device in response to the movement of the stereo projection apparatus"

Claim (C) "at least one sound input device, wherein the processing element is operable to modify the 3D image based on received sound"

Claim (D) "at least one sensor to provide a representation of a real world object, and wherein the spatially aware processing device is operable to synthesize the representation of the real world object with a virtual world to produce the first and second display images. "

Claim (E) "at least one sensor to sense a real world object and to provide a real world object representation;a data source to provide a virtual world representation;a motion sensor;a processing element to synthesize the real world object representation and the virtual world representation in response to the motion sensor; and a three-dimensional (3D) projection apparatus to display a 3D image provided by the processing element. "

This can produce 3D images or modify sound based on the "spatially aware processing device" and sense of sound input. It can also create 3D images by synthesizing a real world object. This is an important patent in the virtual interaction with 3D projection area.

Note : This is also derived from earlier patent application such as Serial No. 11/761,908, filed Jun. 12, 2007, 11/635,799, filed on Dec. 6, 2006 and 60/742,638, filed on Dec. 6, 2005. The present patent application is related to co-pending patent application Serial No. 11/858,696, filed on Sep. 20, 2007.

(3) Patent in application Serial No. 12/866005, Title : Apparatus for Displaying 3D Images

Abstract : A 3D visualization apparatus is described based on the method of generating different horizontal light emitting directions from different screen positions. This is achieved by way of an array of scanning light source modules placed behind the screen. The scanning modules can be implemented by using an array of ID or 2D scanning modules where each one is coupled with at least one light source.

Summary: "approaching 3D displays as 2D displays that have pixels emitting different color and intensity light to different directions, is realized by using an array of scanners that images properly modulated light to the proper screen pixels on their scanning path. "

Other than other 3D display techniques such as holographic displays, volumetric displays and auto-stereoscopic displays, by addressing some of the drawbacks in the above approaches, the patent generally describes a apparatus that enables 3D displaying.

(4) Patent in application Serial No. 12/413201, Title : Two-Mirror Scanning System

Abstract : A scanning beam projection system includes a two-mirror scanning system. One mirror scans in one direction, and a second mirror scans in a second direction. A fast scan mirror receives a modulated light beam from a fold mirror and directs the modulated light beam to a slow can mirror. The fold mirror may be formed on an output optic or may be formed on a common substrate with the slow scan mirror.

This can block the competitors from avoiding the Microvision's IP portfolio by adopting 2 mirrors design.

(5) Patent in application Serial No. 09/858712, Title : System and method for using multiple beams to respectively scan multiple regions of an image

This can provides the image with a higher resolution for a given scan rate by scanning an image as multiple tiles.

(6) Patent in application Serial No. 10/361095, Title : Display system and method for reducing the magnitude of or eliminating a visual artifact caused by a shift in a viewer's gaze

This is used to reduce or eliminate the viewer's perception of a visual artifact when the viewer's gaze shifts with respect to the image.

(7) Patent in application Serial No. 12/466318, Title : Active Input Device for a Scanned Beam Display

This is used to provide an active input control device, such as a stylus pen, configured to receive information from a projection system and deliver information back to the image projection system upon receipt of information.  

Note: This application is a continuation-in-part of commonly assigned, U.S. application Ser. No. 11/967,156, filed Dec. 29, 2007, entitled, "Input Device for a Scanned Beam Display," 

(8) , Title : Three-Dimensional Display Using an Invisible Wavelength Light Source

An innovative approach to providing each eye with one of the images is four-color 3D in which one eye is presented with a full color image comprising three colors and the other eye is presented with a monochrome image comprising a fourth color. The monochrome color typically is selected to have a wavelength in the region of higher eye sensitivity, referred to as the photopic response. The fourth invisible laser light may comprise an ultraviolet (UV) or Infrared (IR) beam for exciting the photoluminescent material in the screen.


Next : Microvision patent portfolio (Part4 - Possible patents from Motorola's Symbol unit)
 

Microvision patent portfolio (Part 2 : interesting patents )

There are so many important patents from Microvision. However, I just want to point out some of the very interesting ones that could catch your eyes, so we can watch their related product developments for the future.

Here is the list of patents deemed intriguing:

(1) Patent No. 7834867 : Integrated photonics module and devices using integrated photonics modules

Excerpt from abstract : "An integrated photonics module includes at least one light source and a MEMS scanner coupled to and held in alignment by an optical frame configured for mounting to a host system. According to some embodiments, the integrated photonics module may include a plurality of light sources and a beam combiner coupled to the optical frame."

Excerpt from the very fisrt claim : "An integrated photonics module suitable for integration in an electronic apparatus comprising: a first alignment frame; a modulatable red laser diode mounted to the first alignment frame and operable to emit a modulated beam of red light along a first axis; a modulatable green laser mounted to the first alignment frame and operable to emit a beam of modulated green light along a second axis parallel to the first axis; a modulatable blue laser diode mounted to the first alignment frame and operable to emit a modulated beam of blue light along a third axis parallel to the first and second axes"

This will introduce the lowest possible cost/size with integrated Green/Blue/Red laser light sources for all laser-based projectors. With DGL (Direct-emitting Green Laser) production in sight, and  Microvision's 10% owner Walsin Lihwa Corp in Taiwan, teamed up with Soraa  Inc. to co-develop integrated laser light sources, the solution provided by Microvision should be the most cost effective in the industry.

(Ref : http://www.microvision.com/displayground/?p=884)
(Ref : http://www.cens.com/cens/html/en/news/news_inner_31723.html)

(2) Patent No. 7791807 : Avoiding interference artifacts in a head-up display or a reflected see-through type display

This is used in HUD (Head Up Display)  with birefringent layer on the windshield or sunglasses to reduce or minimize interference between beams from the display and reflecting off of two or more surfaces that are combined at the viewer's eye, and/or to reduce or minimize the effect of polarizing sunglasses on the viewability of the image projected by the display.

(3) Patent No. 7783133 : Rotation compensation and image stabilization system

This is used in medical devices such as endoscopy and laparoscopy for Rotation compensation and image stabilization system. The patent is co-owned with Ethicon Endo-Surgery (J&J).

The patents was filed in 2006, it indicates Microvision has been working with some major medical companies like Johnson and Johnson through its subsidiary Ethicon Endo-Surgery for a long time.

(4) Patent No. 7839575 : Optical device for use with scanned beam light sources

Excerpt from the abstract : "Substrate-guided relays that employ light guiding substrates to relay images from sources to viewers in optical display systems."

This is about how to mount the pico projector in the side frame of the glasses frame and then reflect the light around into the front of the eye and back onto the retina. It covers the fundamental design of the eyewear display.

(5) Patent No. 7612737 : Scanned light beam display with brightness compensation

Excerpt from abstract : " A scanned beam display is operable to compensate for variations in apparent pixel brightness arising from variations in beam scanning velocity and/or pixel dwell times. A compensation circuit modifies pixel values according to their scanning velocity and/or dwell time.

Projection brightness is often used as an criteria to compare different projectors. However, the power consumption also play an important role in the pico projector design.  How to balance these two factors becomes more and more critical especially for embedded pico projector in a smart phone design. This can provide a way to make the even brightness projection.

(6) Patent No. 7838817 : System for determining an operational state of a MEMS based display

This is for safety - it senses if anything is wrong with the mirror and then will turn the mirror and/or lasers off. As Class 2 lasers are used in Microvision's PicoP design, this can eliminate or reduce the risk of exposing the eyes to the laser even though the risk is already very low.
Next : Microvision patent portfolio (Part 3 : interesting patents in application)

Microvision patent portfolio (Part1 : overview)

中文版

There are many ways to view the strength of a company such as product, revenue, profit margin, ROI, customer list, etc...However, there are invisible strengths which are often overlooked by most of the investors. The patent portfolio is one of them. Sandisk and Qualcomm are two good examples that both companies lure huge profit collecting IP licensing fee each year.

Example1: 

Qualcomm receives billions of dollars in IP licensing deals. Here is the excerpt from "law.com" reported in 2007.
"In 1999 -- the year CDMA was included as standard technology for a new generation of phones that had previously used a competing system -- licensing deals generated more than $454 million, 12 percent of Qualcomm's revenue (Qualcomm also sells its own chips and software).
This year Qualcomm's licensing business has generated $2.77 billion -- 31 percent of the company's total revenue."

(Ref : http://www.law.com/jsp/law/LawArticleFriendly.jsp?id=1196676274843)

Example2:
In 2008 Samsung tried to buy out Sandisk to save the 500 millioms IP license fee. See the news link below:
(Ref : http://www.marketwatch.com/story/samsung-considering-ma-deal-with-sandisk )

Based on US patent office data, Microvision has 134 awarded patents (164 (AN/microvision) minus 18 (AN/"Hermes Microvision") minus  12 (AN/"Microvision Optical"), 195 patents obtained from Motorola and 152 patents in application (187 (AN/microvision) minus 35 (AN/"Hermes Microvision) minus 0 (AN/"Microvision Optical")). So the total patents count as of today is 481. (Please Note : I didn't include all the Microvision's licensed patents worldwide.)

How to evaluate these patents is a difficult task. One easy way is to refer to the authority's data. IEEE is the world's largest professional association for the advanced technology. It has published the patent ranking in each of the hi-tech fields in the past years. The survey was conducted for Spectrum by 1790 Analytics, in Mount Laurel, N.J., a research firm whose specialty is analyzing patent citations. From the Internet, I have collected data for 2006, 2007 and 2009 (I can't find the data for 2008). Microvision ranked 20th, 17th and 13th of those three years respectively in electronics field. See the pictures and links below:

2006 IEEE patent Spectrum "Electronics" Ranking

2007 IEEE patent spectrum "Electronics" ranking

2009 IEEE patent spectrum "Electronics" ranking

As an investor, sometimes we just want to dig into those patents to see which patents are more important than others. Since there are hundreds of them. I used the straight-forward method. IE. reference count as an indicator. In the US patent office website, there are 4 types of references including REF (Referenced by), RLAP (Related US App. Data), FREF (Foreign Reference) and OREF (Other Reference). I included all these 4 references.

Out of the 152 awarded patents, here is the list of the top 20 referenced patents:
        Patent #    Ref count     Title
(1)   6245590 : 62                 Frequency tunable resonant scanner and method of making
(2)   6140979 : 55                 Scanned display with pinch, timing, and distortion correction
(3)   6331909 : 53                 Frequency tunable resonant scanner
(4)   6687034 : 44                 Active tuning of a torsional resonant structure
(5)   6674993 : 43                 Method and system for identifying data locations associated with real world observations
(6)   6515278 : 36                 Frequency tunable resonant scanner and method of making
(7)   6285489 : 35                 Frequency tunable resonant scanner with auxiliary arms
(8)   6650877 : 34                 Method and system for identifying data locations associated with real world observations
(9)   6433907 : 28                 Scanned display with plurality of scanning assemblies
(10) 6445362 : 24                 Scanned display with variation compensation
(11) 6384406 : 23                 Active tuning of a torsional resonant structure
(12) 6762867 : 23                 Scanned display with plurality of scanning assemblies
(13) 6256131 : 22                 Active tuning of a torsional resonant structure
(14) 6151167 : 22                 Scanned display with dual signal fiber transmission
(15) 6362912 : 19                 Scanned imaging apparatus with switched feeds
(16) 6512622 : 18                 Active tuning of a torsional resonant structure
(17) 6515781 : 18                 Scanned imaging apparatus with switched feeds
(18) 6661393 : 16                 Scanned display with variation compensation
(19) 6795221 : 16                 Scanned display with switched feeds and distortion correction 
(20) 6525310 : 12                 Frequency tunable resonant scanner

As you can see, many of the top references have the same title or similar titles. They all center around the design of the tunable scanner with some kind of compensations or variations. These are so called "bolts and nuts" that forms the fundamental of the MEMS scanning mirror design.
As many industry experts have stated, Scanning mirror MEMS is the best solution for pico projector. It's just the cost issue (Green laser) preventing it from becoming the main stream. Once the obstacle is removed, we own the future.

Next: Microvision patent portfolio (Part 2 : interesting patents )