OLED Microdisplay Supplier eMagin Sees Making VR Consumer 'Inroads' in 2016

Fulfilling its military contracts has been “very demanding” for eMagin because there is “zero tolerance for failure," compared with "what is typical in the commercial marketplace,” Sculley said. EMagin’s military work is “effectively raising the bar for microdisplay technology,” and the technology advancement “that we pioneered for our military work really sets a standard and expectation also in the consumer marketplace,” he said. “The features in today’s consumer VR and AR applications will not satisfy the user” for very long, he said. “As the novelty of these new devices begins to wear off, the consumer will start looking for a higher-quality experience and the manufacturers of the headsets will look for better displays.”

The features eMagin has built into its OLED technology for military applications “will enable the next generation of VR and AR products to satisfy these requirements for superior and satisfying experiences,” Sculley said. “If I look at the OLED technology, it is superior to anything on the market today, and I mean that for microdisplays as well as larger displays. And we have the ability to advance applications of this technology for many end markets, as we have shown in the military markets.”

There are a “number of consumer companies with whom we've discussed our road map” for migrating military-grade OLED microdisplay technology for VR and AR consumer headsets, Sculley said. In those discussions, eMagin has learned that many consumer tech companies “don't ask for military brightness for full color," but "do want higher brightness for the augmented reality applications,” he said. The brightness they want and expect from eMagin “is higher than any other OLED manufacturer can make today,” he said.

Using its proprietary “direct-patterning” OLED technology that will reach “manufacturing readiness” in 2017, eMagin can achieve peak brightness levels exceeding 10,000 nits “in full color” for its military-grade applications, Sculley said. “However, most consumer companies are below 5,000 nits, and that’s good for them.” Though the federal government largely funded the R&D effort on direct-patterning, eMagin will fund the equipment and tooling costs, he said. But the investment will be worth it because it will result in “additional new valuable IP for eMagin,” he said: “Remember, no other company has demonstrated direct patterning at microdisplay pixel sizes -- no one.”

For an AR or VR headset to be successful, it “must be small for comfort like a pair of glasses,” Sculley said. “Hence, it really has to have a microdisplay.” For the image in a headset to “look real” requires a high-resolution microdisplay “with minimal spacing between the sub-pixels,” he said.

No OLED “cellphone display will work here because it’s too big for that simple pair of glasses,” Sculley said. And the average OLED smartphone display has less than 600 pixels per inch of resolution, he said. By comparison, eMagin has developed OLED microdisplays for the military that exceed 2,600 pixels per inch or higher, he said. Any microdisplay for an AR or VR headset also needs high speed “because you want the video image to look real and keep up with the voice,” he said. “OLED is needed, LCD won’t do,” he said. “Finally, you need brightness to combat the light in the room and also the inefficiency in the optic.”

Sculley said, “There's only one display company that can meet these requirements, and that's us ... So we're very excited about this and we're very excited when we show our road map. And the guy on the other side of the table says, ‘Yes, I need samples.’” In the process, “we're gaining traction in the marketplace as we sell companies our displays for their development programs,” he said. “And as we increase our penetration into this market by supplying displays, we're really raising the bar by showing the superior features of our displays and capabilities that microdisplays offer, versus the lesser products with whom we compete.”

Discussions are “ongoing” with several “very significant interested parties,” Sculley said. In December, eMagin completed a “strategic licensing deal in the commercial sector” with an unnamed partner that makes eMagin’s supplying of the OLED microdisplays part of the overall intellectual property deal for that partner's VR and AR headsets, he said. That deal, which included a $1 million “upfront” licensing payment from the undisclosed partner to eMagin, was announced on the eve of CES. EMagin also has supplied displays to seven “tier one” companies for testing in their “next-generation VR or AR headsets,” he said.

EMagin also is working on “a radically new display design for a particular company’s HMD effort,” Sculley said of a potential partner's head-mounted display R&D, again without identifying that partner. In addition, "we’re actively discussing volume manufacturing with a number of companies, and that is companies that could help us with the volume manufacturing” that would be crucial in penetrating the consumer market, he said: “We recognize that as AR and VR become more mainstream, we'll need manufacturing partners to help us meet demand for our microdisplays, as we do not have the resources for high-volume production today.”

EMagin expects “a number of these efforts to make significant progress during this year,” Sculley said. But some will “require our ultra-high-brightness technology, which will not be production-ready until 2017,” he said. “Our expertise in the development and design of OLED microdisplay technology and OLED technology in general makes us a desirable partner for our mass production. We are well-positioned to pursue our objectives for 2016.”