LED Lighting’s Big Expansion

September 21, 2010

There is no shortage of emerging competition in LED lighting. Capacity is rising, prices are falling and some of the world’s biggest chipmakers appear ready to do battle.

This week LED kahuna Cree promised to spend $135 million expanding production at its North Carolina fab. It earmarked another $392 million for a new facility in the state and is said to be considering facilities in the low-cost labor markets of China and Malaysia.

Inside Bridgelux's new Silicon Valley fab

General Electric is ramping up its own production, as is Samsung, LG Electronics, Philips and Osram.  In China, about 55 producers are pumping money (some of its state funds) into their own plants.

Even India wants to get in on the act. De Core Science and Technologies is said to be gearing up for LED production at as many as two locations

Don’t forget Bridgelux, a promising U.S. producer that on Monday showed off a Silicon Valley fab where it has big plans for expansion. The company has the capacity to make 5,000 wafers a month and hopes to expand that five fold. About 180 new workers are expected by next year.

The growth should enable Bridgelux to more than double revenue next year from this year’s $30 million, says CEO Bill Watkins.

The industry’s expansion has an obvious motivation. Some estimates suggest a $19 billion worldwide market for LED lighting by 2014. There is big money to be made.

But with the steady expansion around the world, the danger of over capacity and commoditization rises as well.

Clean-room workers in the Bridgelux plant

The excitement of a massive LED market has attracted growing enthusiasm from venture capitalists. Money has poured into companies across the market spectrum, from software makers to hardware designers, including Luminus Devices, Superbulbs, Terralux, Digital Lumens, Albeo, LEDEngin. Bridgelux itself has raised $113.5 million.

There will be more to come.

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Posted by Mark Boslet

Bridgelux CEO Sees $10 LED Bulbs This Year And Has No Fear Of China

April 21, 2010

There will be a revolution in lighting within five years as cheap, bright, energy-efficiency LEDs elbow their way into the market, claims Bridgelux CEO William Watkins.

China is working on last year's technology, not next year's says Bridgelux's William Watkins

The first proof of this transition: $10 LED bulbs this year burning at bright as 40 watts, Watkins said Wednesday. At this price, consumers start to get interested, he suggested.

Watkins, who took over as LED-maker Bridgelux’s top executive three months ago, has never been afraid to speak his mind. This was the case when he ran he world’s largest disk drive company, Seagate Technology. It is turning out to be true as he settles into his new job.

During a Wednesday evening interview, Watkins said Bridgelux has seen early success with its new LED socket design. The design allows LED, or light-emitting diode, chips to snap easily in and out of fixtures, making the substitution of a new brighter bulb simple.

There will be light fixtures with the new sockets on display at the LightFair trade show in Las Vegas on May 12, less than two months after the product’s unveiling.

Watkins saved his sharpest comments for competition from China, which is on the rise. About 50 Chinese companies make LEDs and all are receiving funding from the government, he said. Streetlights across China will all be LEDs, and municipalities will subsidize the production.

So will competition get fierce? Perhaps. But Chinese companies are not on the cutting edge of technology, he says. They are not developing next year’s technology, they are copying last year’s technology, Watkins explains.

“What scares me is if China begins to enforce (intellectual property) rights,” he says. If inventors can enforce their IP rights, the nation begins to nurture the environment of innovation that is missing today, he says.

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Posted by Mark Boslet

Supply Shortage Crimping LED Lighting Market

March 24, 2010

Broad shortages of LED chips used in the latest flat-panel TVs, laptop screens and high-efficiency lighting could turn a dangerous situation into disaster by the end of the year.

Products are already in tight supply as manufacturing capacity is running at full-bore. Analysts predict that unless new plants are brought online by the fourth quarter, severe LED rationing may hit vendors like a holiday season tsunami.

LED lighting is finding itself battling with LED TVs for precious manufacturing capacity.

The LED lighting industry could be most vulnerable. The industry uses the brightest, highest quality LEDs – the hardest to produce – and is seeing capacity already shifting to more mainstream applications, particularly TVs.

Producers are trying to respond. Aixtron of Germany and Veeco Instruments of the U.S. are rushing to double their manufacturing by the fourth quarter. Sensing the unmet demand, LED lighting maker Cree also anticipates doubling its production capacity. The company is building the world’s largest LED manufacturing plant at a site in China.

But questions remain whether this will be enough. LED designer Bridgelux says production capacity around the world for lighting chips is tight. “I want more and I can’t find it,” says CEO William Watkins. The short supply isn’t yet hurting the company, “but we can’t cut prices as fast as we might.”

The constraint also is hampering negotiations. “Right now, it doesn’t allow us to negotiate good prices on our LEDs,” adds Watkins.

Principal Analyst Jagdish Rebello at the research firm iSuppli says demand for all types of LEDs continues to outstrip supply. Sales came to 63 billion units last year and are projected to increase at a double-digit pace this year. That could bring them perilously close to the world’s production capacity of 75 billion units.

“A drastic under supply situation could occur,” warns Rebello.

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Posted by Mark Boslet

Bridgelux Redesigns The LED Light Bulb, Cuts Price

March 23, 2010

Bridgelux hopes to create what has so far eluded the LED lighting industry: an easily replaceable LED bulb.

Bridgelux's new Helieon Sustainable Light Module should make it easy to upgrade to new bulbs when they come out

The California start-up late Tuesday unveiled its Helieon Sustainable Light Module, a product it designed with Molex of Illinois. The package of LED chips and optical gear no longer needs to be screwed into a light fixture. This ease of installation should make it easy to change to new bulbs when brighter, more efficient LEDs come out, says CEO William Watkins.

The new product also cuts prices by 30 to 50 percent.

“I think it’s going to shock everybody,” Watkins said in an interview this week. “We’re really going to accelerate innovation.”

Bridgelux plans to deliver the new line of modules to the market in May and is presently working to have lighting designers incorporate the new socket into their products. Prices will range form $20 to $25 with a brightness of between 500 and 1,500 lumens. That is the equivalent of 75 to 100 watt incandescent bulbs. LED bulbs typically cut power use by 75 percent.

Watkins says the product’s novel approach is its ability to be easily switched. “People are going to want to replace them all the time,” he said. “It’s an easy way to stay on the technology roadmap.”

The challenge for Bridgelux, however, is to convince lighting manufacturers to work with the new socket. At this point, any fixture they create will only be able to use Bridgelux modules.

As competitors such as Digital Lumens and Redwood Systems promote their networked lighting strategy it will be fascinating to see how much Bridgelux is able to change the market.

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Posted by Mark Boslet

Bridgelux Broadens LED Product Line As Prices Fall 30% To 60%

February 3, 2010

No more one size fits all.

LED lighting is bound to be a big market. But price needs to fall as lighting quality rises. And LED arrays need to come in a variety of shapes and sizes to satisfy the myriad needs of the lighting market.

Bridgelux broadens its line of LED arrays for lighting. No more one size fits all.

Some of these conditions will take a couple of years. One is being satisfied today.

Bridgelux is rolling out a second generation of LED arrays Wednesday that for the first time addresses the one-size-fits-all problem. They also make additional steps forward in price and efficiency.

LED lighting is a market waiting to happen. When $10 bulbs hit the market (Bridgelux President Mark Swoboda expects that to happen by the end of 2012) sales will take off. LEDs use one-fifth the power of incandescent bulbs and 12 percent less than compact fluorescents, with none of the mercury. At $10 they paybacks are obvious.

Today, bulbs costing $40 or so are finding early adopters among businesses that save on energy bills and labor costs. Because the bulbs last many years longer than incandescents, workers don’t need to be sent out with replacements as frequently.

Silicon Valley start-up Bridgelux says its new products give it a broader family of arrays than its rivals. The new items vary from 240 lumens in intensity to 4,500 (the 4,500 being appropriate for high intensity retail spot lighting, street and commercial applications).

The mainstream ES Arrays will be able to serve as replacements for 100-watt bulbs.

Prices for the new products will be 30 to 60 percent less than present Bridgelux arrays and efficiency will climb by 30 to 60 percent, Swodoba says.

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Posted by Mark Boslet

Bridgelux Names Former Seagate Chief Watkins CEO, Raises Another $50 Million

January 12, 2010

Hard drives and computers are so yesterday. Saving energy is so tomorrow.

After a year on the sidelines, Bill Watkins wants to build Bridgelux into a big company

This according to Bill Watkins, former CEO of Seagate Technology and, as of Tuesday, CEO of Bridgelux.

Watkins captained the ship at the world’s largest hard drive maker for five years before leaving last January. He says his goal is to now “scale up” Bridgelux into one of the dominant providers of energy saving LED lighting arrays.

“I want to make a big company,” he says. Computers and hard drives? “I’ve done that. This is about energy efficiency.”

Watkins sees sizeable opportunities for Bridgelux in the $100 billion general lighting market. LEDs will someday replace traditional incandescent bulbs and more energy conscious compact fluorescents, with the change over starting in the commercial and government markets and slowly coming to the residential business.

High prices that have constrained sales will steadily decline, he says. Bulbs that sold for $90 a year ago still cost a pricey $40. That will go to $10, says Watkins. And “it will happen very fast.”

An LED lighting array from Bridgelux. The company says an IPO is possible

He adds that Bridgelux has an enviable position in the market, even though it is a small company battling large competitors, such as Sharp and Toshiba, both of which will enter the market this spring.

The company has better technology, a broader spectrum of light in its bulbs and lower costs. It also offers a more complete product to lighting manufacturers. It is vertically integrated, combining an LED chip with optics, electronics and a substrate to create an array that can be easily assembled into a fixture.

So, will Watkins steer Bridgelux to an IPO? The answer is quite possibly yes. “Never go into a private company not thinking about an IPO,” he says. “We will look at this.”

But probably not right away. That’s because the company also Tuesday announced a more than $50 million round of venture funding that should close in two weeks. The round was over subscribed with more investors angling to get in than Bridgelux could invite.

The money should last the company for some time, says Watkins. At least long enough for this former computer era CEO to burnish his clean-tech image.

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Posted by Mark Boslet

Bridgelux Sees Huge Market For Environmentally Sensitive LED Lights By 2012

January 27, 2009

Silicon Valley startup Bridgelux said Tuesday that a roughly $10 billion annual market for low-power LED lights should exist by 2012.

Bridgelux introduces a LED arrays for lighting

Bridgelux introduces LED arrays for lighting

If true, this massive opportunity could spawn several large manufacturers of this next generation lighting and the chips that power it.

The Sunnyvale chipmaker obviously hopes to be one. On Tuesday the startup introduced a new family of light-emitting diode arrays with improved energy efficiency. Lights made with LEDs will become increasingly attractive to industry and consumers as costs per lumens, or light output, continue to come down.

The chips also don’t require the hazardous materials, such as mercury and lead, found in other lights.

“Lamps and luminaires that incorporate LED lighting sources will play an increasingly important role in our effort to reduce overall carbon footprint by minimizing energy consumption and eliminating the use of hazardous materials,” said Bridgelux CEO Mark Swoboda in a statement. Some government already ban traditional bulbs, he said.

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Posted by Mark Boslet

Green Tech Startup Weathers Downturn By Sticking To Its Business Plan And Seeking New Money

October 30, 2008
Bridgelux sees higher performing LEDs by the end of the year

Bridgelux sees higher performing LEDs by the end of the year

Bridgelux may be more fortunate than many Silicon Valley startups.

The Sunnyvale maker of LED chips for the commercial lighting market has a substantial sum of money in the bank after raising $30 million in March. It also has products in the market, announcing in June volume shipments of its latest NLX-5 energy-saving diode.

So even as the downturn ripples through a worried venture community, Bridgelux will stick to its business plan to break even in the fourth quarter of next year, says CEO Mark Swoboda.

“We won’t build a factory anytime soon,” Swoboda concedes. Instead the company will rely on partnerships to expand production capacity if necessary.

But “we won’t derail the progress we have made up to now,” he says.

Underlying Bridgelux’s confidence is the likelihood of an explosive market for high-efficiency LED lighting fixtures – a market that should find LEDs increasingly attractive as costs per lumens, or light output, continue to come down.

The NLX-5, Bridgelux’s fifth generation chip, offers a 15 to 20 percent performance improvement over its predecessor, and another 10 to 15 percent improvement is expected before the end of the year.

Swoboda says the promise of a 1 to 2 year payback for LED lighting should make it popular in the commercial market even if up-front costs for the equipment are higher. LEDs also have none of the mercury found in compact fluorescent bulbs.

Bridgelux says in its established technology is leading the company back to the fund raising market with the goal of raising another $25 million to $30 million between November and January. Many investors may see it as the last opportunity to put money into the company, Swoboda says.

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Posted by Mark Boslet

Clean Tech Funding May Be Squeezed, But VC Points To Four Hot Startups

October 10, 2008
Green Tech Startup Better Place

Green Tech Startup Better Place

Clean-tech startups may be having a tough time getting money, but the financial turmoil gripping Wall Street hasn’t diminished their market opportunities.

Green technology companies may do to the lighting, auto and electric industries what computer-technology companies did to information technology over the past decades, said Stephan Dolezalek, managing director at VantagePoint Venture Partners.

“We’re going to be challenged over the next couple years,” he said Thursday at a TechNet clean-energy conference in Sunnyvale. “But I’m very, very convinced the opportunity is larger than the one we faced in the past 30 years.”

Dolezalek pointed to four companies in his portfolio with interesting technologies.

*Premium Power: developing large batteries of salt water and zinc with plenty of capacity;

*Better Place: connecting electric cars to energy sources whether they are solar or fossil-fuel based;

*BridgeLux and SuperBulbs: working on a more efficient light bulb where 8 watts of energy will equal the output of 100 watts.

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Posted by Mark Boslet

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