ARM vs. Intel – Silver bullet?

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Last time it was software. This time its emulators 

  • Qualcomm and Microsoft have announced that Windows is once again coming to the ARM processor but this time the approach is completely different to the disaster that was Windows RT.
  • In Windows RT, Microsoft modified Windows 8 such that it would work on an ARM processor and in the process killed flexibility and backwards compatibility to legacy software.
  • The result was a platform that was shunned by both developers and users, completely killing any hope that ARM would gain penetration in Intel’s home turf of PCs.
  • The fact that Intel has cut its lower end Atom line of products that aimed to compete with ARM in Android tablets has left space in the market for these products to grow into.
  • This time the approach is completely different as Qualcomm and Microsoft have produced an x86 emulator that fools the software into thinking that there is an x86 chip present.
  • The net result is that any Win32 and universal Windows app will run on the device with no modifications being required by the developer.
  • The net result is hoped to be cheaper, fan-less, always-on, mid to low end PCs that have longer battery life than their counterparts powered by Intel.
  • Qualcomm and Microsoft have also promised that Adobe Photoshop, Microsoft Office and Windows 10 games will all run on these products and it is here that I find the big caveat in this strategy.
  • This caveat is performance.
  • Intel processors may be power hogs but they offer blistering performance in real world devices as well as in benchmark tests.
  • ARM has been able to match some of the benchmarks but has never been able to come close to Intel in real devices.
  • This is why the mention of Photoshop, Office and games is so important as these three are well known to be very processor intensive.
  • Their requirements are so high that the software is written directly to the processor (written to the metal) to avoid any lags created by going to the processor via the operating system.
  • This is where the problem will occur as processor heavy apps will no longer be written directly to the metal but instead will be going through the emulator.
  • The emulator process is as follows:
    1. Translate requests from the x86 programs sitting on top of it into the RISC instruction set that ARM understands.
    2. Execute the request on the ARM processor.
    3. Translate the results back into the x86 instruction set so that the app can run.
  • Consequently, the emulator will incur additional processing overhead as well as consume power.
  • The big questions are how much will it consume and will it have an impact on the overall user experience?
  • For Intel, this is a critical question because if there is no impact it could see its market share in the mid-range PC market (most of the volume) come under serious threat.
  • In Q3 16A Intel reported non-GAAP gross margin of 64.8% compared to Qualcomm at 58.9% but if I remove the profits from licencing, I estimate that Qualcomm’s chip gross margin is around 40%.
  • Consequently, if Qualcomm’s Snapdragon chipset plus the emulator can match Intel’s performance, Intel will have to cut its prices to stay in contention.
  • This could see its gross margin come under sustained pressure as the first real challenge to its monopoly finally hits home.
  • History is on Intel’s side as emulators on battery powered devices have always impacted the user experience so much that the experience failed to win over users.
  • In order to put pressure on Intel, the Qualcomm powered Windows 10 devices will have offer the same level of functionality and performance, better battery life as well as a cheaper price.
  • These are my three criteria for Qualcomm to really challenge Intel and success will come down to the quality of the emulator that it has created.
  • Qualcomm will also need to work closely with the device makers as there are endless hardware configurations for Windows 10 PCs and clumsy integration could easily make a complete mess of the elegant product that Qualcomm and Microsoft have created.
  • The first devices will be available early 2017 (launch at CES 2017 looks likely) and it is by these that Intel’s outlook will be judged.
  • This is obviously negative for Intel but it is worth remembering that every attempt to dislodge Intel to date has been a miserable failure.

Lenovo – All mod cons

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Motorola is the only one with a chance of succeeding with modularity. 

  • Lenovo’s Motorola is increasing its commitment to its modular mobile phones with the promise of more mods and remains the only one with a chance of making this strategy work.
  • Modular mobile devices are nothing new and the mobile phone graveyard is littered with various attempts that have been made over the last 15 years.
  • The latest to be interred is Google’s Project Ara which was closed down a couple of months ago.
  • On the surface, a modular mobile phone is a great idea as it gives users flexibility to specify the exact device that they want or to swap components in and out based on their requirements.
  • However, this comes at the cost of complexity and history has shown that making modular devices is extremely difficult.
  • This is because there are fundamental limitations inherent to the design that must be overcome.
  • These are:
    • First: Each module requires an individual case and a connector. These take up space, making the resulting device bulkier and less sleek-looking than a normal device.
    • Second: Each swappable component has to remain distinct from all the others. Integrating components together is a tried and tested method of cost and size reduction meaning that a modular device has always been more expensive to make.
    • Third: Every swappable component has to be tested with every other in every possible configuration to ensure that they all work together properly. This means that testing and certification is much more onerous meaningfully increasing development costs.
  • Motorola has overcome many of these limitations by designing a very thin mobile phone that uses a single magnetic connector on its back to communicate with any other component that is connected to it.
  • Only one mod can be attached at a time greatly simplifying the solution to the above problems.
  • The end result is that the Moto Z, Moto Z Force and Moto Z Play come by far the closest to meeting my rules of the road for a modular device to succeed.
  • These are:
    • First: It must be the same size and weight as competing products.
    • Second: It must make no compromises in terms of styling,
    • Third: It must offer the same functionality as competing products.
    • Fourth: It must come at the same price point as non-modular variants.
  • With mods added the device can become thicker than one would expect for a mobile device and once mods are included in the price, it also becomes more expensive.
  • However, these compromises are compensated for with excellent functionality including creating a great point and shoot camera from Hasselblad as well as audio speakers from JBL.
  • I think that the key to real success for this strategy will be the creation of many more mods by third parties and here Motorola is working hard to create a third-party ecosystem around its connector.
  • If Motorola can increase the traction around this device category then it will be able to create device preference which in turn will lead to better margins which are badly needed by Lenovo’s mobile unit.
  • I suspect that 2017 will be a make or break for this strategy.
  • Overall, Lenovo remains my favourite PC makers as it is the market leader, has a good grasp of what it needs to do to thrive and a pretty good track record in execution.
  • I would prefer this over all of the other PC makers.

Samsung – Empty horse

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There are no Greeks hiding in the wooden horse of Harman. 

  • Samsung’s acquisition of Harman is about increasing its penetration of the automobile rather than offering a sneaky challenge to the car industry.
  • Samsung has announced that it will acquire 100% of Harman International Industries for KRW9.3bn / US$8.02bn in cash with the deal expected to close in Q3 2017.
  • Harman is a well-known Tier 1 automotive components supplier with 65% of its $7bn in revenues coming from the automotive industry.
  • Its particular area of strength is in audio, electronics and infotainment systems which are already present in 30m vehicles worldwide.
  • I see this deal benefiting Samsung in two ways.
    • First – Verticalisation. Samsung will have more internal demand for its components as well as a large, new in-house customer for its foundry, Samsung LSI.
    • Furthermore, there will be an opportunity for improved integration between hardware and software which should improve the performance of Harman’s products.
    • Second – Customer access. Harman has strong relationships with almost every car maker which will give Samsung an avenue through which to sell its other products such as semiconductors and displays to the automotive industry.
  • I do not think for one minute that acquisition is about Samsung building its own car or about Samsung extending its own digital ecosystem into the car.
  • Consequently, I do not see this deal as threatening for the automotive industry but it is a threat for suppliers of Harman who now may lose out to the in-house supplier and to Harman’s competitors who may have a tougher time going forward.
  • Apple’s realignment of its automotive experiment (see here) is a strong indication of how it is not a good idea for a tech company to start making cars and I do not think that Samsung ever had any intention of following Apple down this road.
  • Most importantly, Samsung does not represent the same threat to automotive brands that Apple and Google do, as it long ago gave up trying to compete in the ecosystem.
  • This means that Samsung will not be intending to ensure that its services (perhaps with the exception of Viv (see here)) and its brand are front and centre in automotive infotainment units and it will not be extracting any data.
  • Consequently, I think Samsung simply aims to extend its strategy of selling electronics at huge scale and thereby earning a much better return than its competitors.
  • This deal positions it well to meaningfully increase its penetration in the automobile as it becomes increasingly driven by electronics and increasingly autonomous.
  • Samsung has realised that software and services is difficult and with every move that Samsung makes I see it increasingly leaving this piece to others such as Google.
  • Hence, I think the automakers can rest more easily when it comes to Samsung and continue to put their attention on ensuring that Apple and Google do not steal the relationship they are trying to build with the end customer.

Samsung – Kitchen sink.

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Samsung kitchen sinks the note 7 with a massive $5.4bn hit to profit.

  • The note 7 disaster is going to cost shareholders $5.4bn in lost profit and heads are almost certain to roll, but underneath it all I think Samsung has been extraordinarily unlucky.
  • Samsung has updated its guidance for Q3 16 as well as indicating the impact that the note 7 will have on Q4 16 and Q1 17 EBIT.
    • Q3 16 revenues / EBIT will now be KRW2tn / KRW2.6tn lower than Samsung forecast just a week ago.
    • This amounts to total Q3 16 revenues / EBIT of KRW47tn / KRW5.2tn.
    • EBIT will be US$2.3bn lower than previously forecast.
    • Q4 16 EBIT is expected to lower by KRW2.5tn or US$2.2bn.
    • Q1 17 EBIT is expected to be lower by KRW1.0tn or US$885m.
  • This means that over the next 2 quarters EBIT and cash flow will take a $5.4bn hit.
  • I also suspect that by the end of the year, there will be a changing of the guard at the handset business as Samsung tries to draw a line under this disaster.
  • On the surface this looks like very bad management by Samsung but to be fair the company, I think that in the same situation, Apple would have done the same thing.
  • It is certainly a fair argument to say that Apple would have never got itself into this mess in the first place but it is important to remember that Samsung and Apple compete for users very differently.
  • Apple users buy its products because they want to have access to an ecosystem that is exclusively available on iOS devices whereas Samsung competes directly on hardware specification.
  • This means that Samsung is forced to push the boundaries of hardware performance whereas Apple has more time to thoroughly explore new features before it deploys them.
  • It was this pressure that now looks to have sunk Samsung.
  • The most likely explanation now is that the culprit was the fast charging algorithm which combined with an unknown factor or factors that triggered the fires.
  • This is where I think Samsung has been extraordinarily unlucky.
  • Every event of this nature in the past has always been caused by the battery and given that all the early events involved devices carrying the Samsung SDI battery, this looked almost certain to have been the cause.
  • The problem is that to have definitively worked out exactly what the problem was would have taken weeks and Samsung simply did not have that kind of time.
  • I am certain that if the device had been pulled for 6 weeks with users being left high and dry, there would have been a substantial loss of share anyway.
  • This is why Samsung had to act quickly and because it could be more than 90% certain that the cause was the battery, its move to replace Samsung ADI batteries with Amperex was the right move at the time.
  • This is why I am pretty sure that if Tim Cook had been sitting in DJ Koh’s seat, he would have done the same thing.
  • With this $5.4bn hit, I think that Samsung has drawn a line underneath the immediate impact but the hit to its brand and market share has yet to be felt.
  • Samsung depends on the fact that it out-ships its next Android competitor Huawei by 2.7 devices to one for its high profitability and if Huawei can close the gap due to this mess, then the damage could be much greater.
  • Huawei and Google are in pole position to benefit from Samsung’s woes but I continue to believe that these users are unlikely to go to Apple (see here).
  • Although Samsung’s valuation remains undemanding, the damage to its brand and market share has yet to be quantified which is why I feel no urge to get back into Samsung following recent declines.
  • I continue to prefer Microsoft and Baidu.

Samsung – Limited fallout.

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A fast and efficient recall results in no lasting harm. 

  • Samsung has taken the prudent decision to recall the Galaxy Note 7 following a series of fires almost certainly caused by manufacturing faults with the battery.
  • RFM research indicates that this will affect approximately 2.5m devices which I estimate cost Samsung approximately $1bn to produce.
  • I suspect that the cost of this will almost certainly be borne by the suppliers of the batteries for this product which are Samsung SDI (Samsung owns 20%) and Chinese supplier Amperex.
  • Assuming that Samsung SDI supplied 70% of the batteries, then the total financial hit to Samsung is likely to be around $140m that will be felt through lower profit in the associates line of the profit and loss account.
  • This will leave barely ripple in the accounts but the reputational damage to Samsung’s brand could be meaningful.
  • Samsung is the pre-eminent Android vendor with by far the strongest brand and a reputation for producing high quality devices.
  • Furthermore, the timing could not be worse with Apple due to launch a range of new products including the iPhone 7 in two days’ time.
  • This is why the speed with which Samsung puts this issue to bed is of paramount importance.
  • Samsung has already taken the decision to offer consumers to replace their devices with a Galaxy s7 or s7 edge which will speed replacement as these devices are already in stock.
  • Where there is a difference in price, I suspect that Samsung will be more than generous to its users.
  • Samsung has acted quickly and decisively to deal with its problems in the past and I see this situation as no different.
  • Consequently, I think the next few weeks will be difficult with bad press and new Apple products, but as long as Samsung executes the recall quickly and diligently, I see no lasting harm.
  • I am confident that it will do exactly that.
  • Hence, I remain unconcerned with neither Samsung’s market share in Android nor its profitability in the short term as it remains in the middle of a healthy replacement cycle (see here).
  • I see no material change to Samsung estimates in the short-term which leads me to remain positive on Samsung up to a share price of KRW1.8m, some 13% above where it is now.
  • Samsung remains alongside Microsoft and Baidu my top choices for the balance of this year.

Flexible displays – Press cycle

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Flexible screens back for another press cycle.

 

  • With the success of the Samsung Galaxy Edge, it looks like Samsung is thinking of having another go at bringing flexible displays to the market in a meaningful way.
  • This is the third or fourth time in 6 years that Samsung has considered launching these products.
  • The technology for flexible screens is not the problem as fully bendable displays that can withstand a beating with a hammer have been around for more than 6 years.
  • The main issues are manufacturing yield which determines the price of the display and end user demand.
    • Yield. The economics of LCD and OLED panels depends on very high volumes with only a tiny percentage of devices being defective and having to be thrown away.
    • The encapsulation of flexible displays has long been a sticking point in the manufacture of these products causing far too many panels to be defective.
    • This has had the effect of making the panels prohibitively expensive which would make the phone or tablet so pricey that no one would buy it.
    • Demand. The problem with flexible displays is that beyond one obvious use case which has its own problems (see below), no one really knows what to do with them.
    • The Samsung Galaxy Edge is a case in point as the curved part of the screen has no real function other than for offering alerts.
    • Consequently, it is a nice looking, cool to have but otherwise pointless gimmick.
    • In the mobile phone market, pointless gimmicks have time and again been shown to sell devices in huge volumes at the high end and the Galaxy Edge has been no exception.
    • Unfortunately this will make bringing flexible screens to the main stream very difficult and Samsung has had great difficulty in finding buyers for these screens in the past.
  • I have long believed that the one use case that makes sense for a flexible screen is the ability to have a tablet that folds or rolls up into a phone form factor when not in use.
  • This is because these days a tablet is little more than a phone with a large screen as all the other components and the software is almost exactly the same.
  • This comes with its own caveats which is that the screen when unfolded into the tablet form factor, it needs to be rigid to make it useable.
  • That is likely to prove to be easier said than done and I suspect that this use case is unlikely to make an appearance for quite some time.
  • The net result is that with no real use case in sight for these devices, I suspect that Samsung may decide to hold off launching them in earnest until it can figure out what users can do with them.
  • Hence, I suspect this theme, like every time in the past, will have a quick press cycle and then disappear into obscurity until someone really works out what to do with these screens.
  • I still see upside in Samsung and Microsoft and prefer both to Google. Apple is still looking very attractive for the long-term.

Project Ara – The Holy Grail Pt II.

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Different game but the rules stay the same.

  • Google has scaled back the ambitious objectives of Project Ara (see here) to something more realistic, but to succeed it will still have to obey the four rules of the road (see here).
  • Prior to its reorganisation, Project Ara aimed to provide a device where every major component was modularised and could be swapped with a different specification.
  • This creates three enormous challenges:
    • First. Each module requires an individual case and a connector. These take up space, making the resulting device bulkier and less sleek-looking than a normal device.
    • Second. Each swappable component has to remain distinct from all the others. Integrating components together is a tried and tested method of cost and size reduction meaning that a modular device has always been more expensive to make.
    • Third. Every swappable component has to be tested with every other in every possible configuration to ensure that they all work together properly. This means that testing and certification is much more onerous, meaningfully increasing development costs.
  • These challenges made it almost impossible for Google to produce a modular device that was both ergonomic and competitive in terms of price.
  • In the last 12 months, Google appears to have realised this and has scaled back its ambitions such that the guts of the device remain the same and just the peripheral components can be swapped out.
  • Examples of these are cameras, storage, speakers, sensors, batteries and so on.
  • The idea now is for the user to be able to mix and match features that users are unable to get anywhere else and thereby provide something different.
  • This change substantially reduces the three challenges above but does not obviate the device from having to be both ergonomic and economic in order to succeed (see here).
  • This means that the device must be no bigger than a competing, non-modular device of the same specification and it must come at the same price.
  • The problem is that even with these changes, the current prototype looks weird and is bulkier than other devices with the same specification.
  • From the videos that Google put up at I/O, I think that it intends to market the device by making its funky form factor a selling point in a sea of sameness thereby addressing the ergonomic issue.
  • Google has plenty of cash on the balance sheet to absorb losses from selling the product at a competitive price, but with the new age of fiscal discipline that has been ushered in, it may not be willing to do so.
  • Furthermore, LG already has a similar device in the market and while its modularity is far less, it has done a much better job in terms of ergonomics and form factor.
  • Consequently, while Google’s task is now undoubtedly easier, Project Ara must still obey the four rules of the road which remain:
    1. It must be the same size and weight as competing products.
    2. It must make no compromises in terms of styling,
    3. It must offer the same functionality as competing products.
    4. It must come at the same price point.
  • If all four of these can be fulfilled then there is a real chance of success as the user is being offered something new without having to make any compromises.
  • Even with the changes that have been made, I think that Project Ara is still some way adrift of meeting these rules but it is certainly closer than it was 12 months ago.
  • The short-term outlook for Alphabet remains healthy but the fact that this is more than reflected in the valuation leads me to continue to prefer Microsoft and Samsung for the short-term and Apple for the long term.

 

Alibaba FQ4 15A – Ecosystem investor

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E-commerce powerhouse fuels ecosystem investments.

  • Alibaba reported good FQ4 15A results but sent the clear message that would be ramping up investments in its fledgling ecosystem.
  • FQ4 15A revenues / EBIT were RMB24.2bn / RMB5.1bn nicely ahead of consensus at RMB23.6bn / RMB4.6bn.
  • Its Chinese e-commerce platforms Tmall (B2C) and Taobao (C2C) grew 41% YoY while GMV grew by 24% YoY highlighting Alibaba’s increasing ability to monetise the transactions that run across its platforms.
  • Alicloud also fared well accelerating to 175% YoY passing 500,000 customers, somewhat mimicking the dynamics experienced by Amazon (see here).
  • Increasing scale allowed margins to come in better than expected resulting in the strong EBIT performance exhibited.
  • However, Alibaba was at pains to highlight its strategy which is to invest heavily and build a thriving ecosystem from two areas.
    • First. To capitalise on the user to user social interaction that is drives the transactions on Taobao and to encourage users to do more than just buy products on its platform.
    • Alibaba has begun this by encouraging greater interaction between users and to use the platform for the delivery of content such as photos, videos and live streaming.
    • Second. Alibaba has investments in media consumption (YouKou Tudou), Browsing (UCWeb), Navigation (AutoNavi), Gaming (9Game.com), Payments (AliPay) and Search (sm.cn) giving it many of the components needed for an ecosystem.
    • Now comes the tricky part of sticking all of this together in an easy and fun to use way such that its 423m active buyers on mobile become more engaged with the other activities they do on their devices.
  • Both of these require significant investments and Alibaba stressed multiple times that these businesses could be loss making, bringing down the corporate average, for several years before any real results are seen.
  • To help the short-term minded market, Alibaba has promised to improve its disclosure (slightly like Alphabet) such that it one can see the core business profitability and how much of that is then being invested in the new businesses.
  • This is exactly the right strategy for Alibaba to pursue as economic growth in China is already slowing fast and soon the secular trend from a manufacturing economy to a consumption economy will also begin to slow.
  • This will leave it slugging it out with Tencent, Baidu, Xiaomi and China Mobile for the hearts and minds of the Chinese smartphone users which is where most of its long term growth is likely to come from.
  • Alibaba has fantastic cash flow giving it plenty of scope to make the investments it needs.
  • It just remains to be seen whether Alibaba’s management that has been very e-commerce focused can successfully widen its remit and succeed in the much more diverse, difficult and competitive landscape it is now turning to address.
  • On this hinge Alibaba’s long term growth and the performance of its shares.

Samsung Q1 16A – Forgotten jewel

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Semiconductors remain the real engine of growth.

  • Samsung reported good results and I think that it is both handsets and semiconductors that have bolstered profitability.
  • Q1 16A revenues / EBIT were approximately KRW 49tn / KRW 6.6tn nicely ahead of consensus at KRW 48.8tn / KRW 5.5tn and RFM at KRW 48.8tn / KRW 5.5tn.
  • The initial figures for the Galaxy s7 look to have been much stronger than the Galaxy s6 mainly as a result of its lower price.
  • The s7 was also available a month earlier than the s6 giving it more time to have a positive impact on the Q1 16A figures.
  • Although all of the attention is being placed on the handset business, I suspect that Device Solutions also contributed to the better than expected figures.
  • Samsung has reported revenues very close to RFM forecasts so the improvement in profit has all been about an improvement in margin.
  • If I allocate all of the “extra” KRW 1.1tn of operating profit to the handset business then margins were probably around 14% rather than the 9-10% where they have been for the last 5 quarters.
  • I think it unlikely that a single model being available for only part of the quarter could have been responsible for such a large swing in profitability.
  • Consequently, I suspect that the semiconductor business has also had an impact on these figures.
  • Q4 15A was a difficult quarter for the semiconductor business as an unusually weak forecastforf Q1 16A demand caused margins to dip to 21% from the 28-30% it had been enjoying during 2015.
  • The resulting inventory correction in adjusting to a weakening market in 2016 caused margin pressure.
  • Now that this correction appears to have been completed, it looks like the margins at Semiconductors as been able to bounce back nicely.
  • Consequently I think that margins in handsets have come back to around 11% compared to 8.9% in Q4 15A and semiconductors have bounced back to around 27% from 21.2% in Q4 15A.
  • This is good news because in the medium term, the growth story in Samsung Electronics is all about the semiconductor business steadily expanding its revenues at its historically, excellent margins.
  • This thesis also requires for the handset business to keep its margins flat at around 9-11%.
  • In this regard, Q1 16A looks to have been a good quarter and allays my fears from Q4 15A that the semiconductor business was slipping.
  • Samsung’s shares have already rallied on the back of good Q1 16A results but I think that the shares remain good value to KRW1.56m (22% from here).
  • Samsung along with Microsoft remain my top choices although I can see short-term upside in Google as well very low risk of downside in Apple.

Flexible displays – University challenge

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Flexible displays are hard to make and mostly useless.

  • The latest innovation around flexible screens has been announced by the Queen’s University Human Media Lab in Canada which uses the flexing of the screen as a method of command input.
  • A flexible LG OLED display has been combined with sensors and can detect to what the degree the screen is being flexed.
  • The headline example is using the flexing of the screen to flick through the pages of an ebook which is very similar to what a user would do with a paperback.
  • The paperback has the obvious advantage being readable in bright sunlight and infinite battery life.
  • The researchers also demonstrate using the device as a regular touch screen smartphone.
  • This is all well and good but I suspect that we are still very far from seeing flexible panels hitting the mainstream.
  • Samsung and LG have had fully flexible, virtually indestructible panels for years but to date, only the most basic curved and flexible panels have made it to the market.
  • There are two main reasons for this.
    • First. These devices are quite difficult to make meaning that a meaningful number of the panels fail quality tests and have to be thrown away.
    • This makes mass production prohibitively expensive and the premium that the maker would have to charge for the panel is so high that the user won’t pay for it.
    • RFM research indicates that Samsung and LG are continuing to wrestle with this problem but that little progress has been made.
    • The fact that there is no demand in the market for these devices (see below) has also not enticed them to expedite solving the mass manufacturing problems.
    • Second. No one has really come up with a decent use case for a flexible screen to date.
    • This problem is so acute that I understand that even Samsung had problems in rustling up interest for its curved and flexible displays from device manufacturers.
    • I have long been of the opinion that a major use case for this technology is a display carried on a phone form factor that can be unfolded or unrolled to give a display of 10-14 inches.
    • This would obviate the need to ever have a tablet and I think could kill the market overnight.
    • Unfortunately, the technology to make screens to this specification is still not ready and while simpler versions languish, I suspect that this will remain on the shelf.
  • The net result is that flexible displays are cool to see for the first time but do very little to improve the use case of the device.
  • Consequently, I suspect that flexible displays will not be making any impact on the device or ecosystem economics anytime soon.