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7 Advanced Manufacturing INTRODUCTION As of 2009, the United States accounted for 21 percent of global manufactur- ing value added, measured at 2009 purchasing-power exchange rates.1 The U.S. share has declined since at least 1990, and the share of producers (including U.S.- owned production facilities) in the industrializing economies in Southeast Asia and elsewhere has grown. Nevertheless, a great deal of cutting-edge innovation and a modest amount of manufacturing activity to support it have remained in the United States, and this generalization applies to photonics and other high- technology industries. This chapter discusses photonics manufacturing, emphasizing three distinct but closely linked issues. First, it examines the relocation of production of pho- tonics components and products in three key product fields—displays, solar tech- nologies, and optoelectronic components—and the factors behind the offshore movement of much of this production activity. Next, it discusses the relationship between manufacturing and innovation in photonics technologies, highlighting the contrasts and similarities among the three cases in an effort to explain how and where the United States has been able to retain dominance in both production and innovation in selected photonics technologies. Finally, the chapter examines photonics in manufacturing, discussing new advances in manufacturing tech- 1 United Nations Industrial Development Organization (UNIDO). 2010. International Yearbook of Industrial Statistics. Cheltenham, U.K.: Edward Elgar Publishing. 185
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186 Optics and Photonics: Essential Technologies for O u r N at i o n nologies and production capabilities made possible by applications of photonics technologies. PRODUCTION AND INNOVATION IN PHOTONICS TECHNOLOGIES: THREE CASE STUDIES This section presents three case studies—displays, solar cells, and optoelectron- ics components for the converging communications and computing industry—to examine trends in the offshoring of manufacturing and the relationship between manufacturing and innovation. All three deal with optic and photonic applications based on semiconductor technologies that originated in AT&T Bell Laboratories and other large corporate laboratories. While all three cases have similarities, im- portant differences among them have implications for innovative performance, industry structure, and public policy. It is noteworthy that there is a continued need for increased resolution, smaller features, and increased packing density in all cases of production technologies. This need will drive a need for optical sources and imaging tools supporting the increase in resolution. Displays Of the three industries, the earliest to move manufacturing overseas from the United States was displays. As discussed by Macher and Mowery in the National Research Council report Innovation in Global Industries: U.S. Firms Competing in a New World,2 although the technological foundations of the display industry were developed in the United States in the 1960s, the industry’s production operations quickly migrated to Japan and then to Korea and Taiwan.3 By 1995, liquid-crystal displays (LCDs) accounted for greater than 95 percent of flat panel display sales by value and thin-film transistor (TFT) LCDs accounted for more than 90 percent of LCD sales, having first found their way into application in calculators, then in cell phones and computers applications, and more recently, as prices continued to decline, largely replacing cathode ray tubes in television receivers.4 Large TFT LCDs accounted for about 75 percent of the value of TFT LCD sales, although the unit production volume of small and medium-size LCDs was five to six times that of large TFT LCDs.5 TFT LCDs remain the dominant display technology. TFT LCD manufacturing and innovation have their roots in the United States 2 National Research Council. 2008. Innovation in Global Industries: U.S. Firms Competing in a New World (Collected Studies), J.T. Macher and D.C. Mowery, eds. Washington, D.C.: The National Academies Press. 3 National Research Council. 2008. Innovation in Global Industries. 4 National Research Council. 2008. Innovation in Global Industries. 5 National Research Council. 2008. Innovation in Global Industries.
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A d va n c e d M a n u fa c t u r i n g 187 in the late 1960s with a number of research advances by such major firms as RCA, Westinghouse, Exxon, Xerox, AT&T, and IBM.6 Of those firms, only IBM invested in high-volume manufacturing—through a joint venture with Toshiba in Japan.7 In contrast, all the major Japanese electronics firms invested in high-volume manu- facturing. Manufacturers of TFT LCDs face primarily two strategic decisions: when to invest in the construction of a new fabrication facility and whether to move to the next generation of substrates. In 1996, greater than 95 percent of all TFT LCDs were produced in Japan. By 2005, fewer than 11 percent were made in Japan, and the top two production locations were Korea and Taiwan, each of which produced roughly 40 percent of total output. The main reasons for the shift in production location were the lower engineering and labor costs in Korea and Taiwan and the ability of first Korea and then Taiwan to raise the large amounts of capital needed for investing in state-of-the-art fabrication facilities. The window of opportunity for Korean entry occurred in 1991 when Japanese firms were unable to raise the capital needed for investing. Similarly, the window of opportunity for Taiwanese entry came during the Asia crisis of 1997-1998 when Korean firms experienced difficulties in financing new plants.8 (See Figure 7.1.) Although the successful integration of each generation of production equip- ment depended on investment in high-volume production, new materials and equipment were not necessarily developed in the same countries that invested in manufacturing. Figure 7.1(b) shows the changing proportion of U.S. versus total U.S. Patent and Trademark Office (USPTO) patents in LCDs. Although it might be tempting to focus on the United States’ declining share of total worldwide LCD patents, it is important to note both that this represents only LCDs, not the next big thing in display technologies, and that even in LCDs the share of patents fails to show a full picture.9 Thus, in addition to IBM’s joint effort with Toshiba for TFT LCD manufacturing, a number of important U.S. firms participated in the industry—most notably, Corning (in substrate materials), Applied Materials (in chemical vapor deposition equipment), and Photon Dynamics (in test, inspection, and repair equipment). These firms remained key players in the market through their ability to acquire knowledge by working collaboratively with manufacturers outside the United States. At the global level, liquid-crystal materials were devel- 6 National Research Council. 2008. Innovation in Global Industries. 7 National Research Council. 2008. Innovation in Global Industries. 8 National Research Council. 2008. Innovation in Global Industries. 9 The data described above are based on the U.S. versus other nations’ shares of patents in the USPTO database. Past research suggests that U.S. patents are a reasonable measure of unique inven- tive activity worldwide by internationally competitive companies. Notably, the patents described in this data are in no way weighted by their scientific or market value. Thus, there is no way to tell which patents described in Figure 7-1b may be highly incremental additions to existing knowledge rather than revolutionary.
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188 Optics and Photonics: Essential Technologies for O u r N at i o n (a) (b) FIGURE 7.1 (a) Percentages of production shares of thin-film transistor (TFT) liquid crystal displays (LCDs). SOURCE: Murtha, T., S.A. Lenway, and J.A. Hart. 2001. Managing New Industry Creation. Stanford, Calif.: Stanford University Press. (b) U.S. firms’ or laboratories’ share of total USPTO LCD patents. SOURCE: U.S. Patent and Trademark Office. 2012. “Patenting in Technology Classes, Breakout by Organization.” Available at http://www.uspto.gov/web/offices/ac/ido/oeip/taf/tecasga/349_tor.htm.
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A d va n c e d M a n u fa c t u r i n g 189 oped and fabricated primarily in Western Europe and sold to East Asian produc- ers. Chemical vapor deposition equipment was developed primarily in the United States and Western Europe. Testing equipment was developed mainly in Japan and the United States. Finally, lithographic equipment was developed primarily in Japan, the United States, and Western Europe. Given the time pressures created by the frequent transitions from one generation of production technology to the next, materials and equipment suppliers became more important. Unlike their Japanese counterparts, Korean and Taiwanese firms were generally unable to build their own production equipment and instead had to rely largely on external suppliers.10 Although IBM, Corning, Applied Materials, and Photon Dynamics were suc- cessful in the display industry, other U.S. firms were less successful. A number of relatively small, niche producers of TFT LCDs engaged in a variety of efforts to catch up with the Japanese, some of which involved financial support from the U.S. government, in particular the Defense Advanced Research Projects Agency (DARPA). Murtha, Lenway, and Hart argue that successful entry by these U.S. firms at this late stage required that they work with partners in East Asia that were experienced in high-volume production.11 U.S. government policies made it dif- ficult for firms receiving government funding to work closely with manufacturers in Asia, and most of these firms did not recognize the importance of collaborating with high-volume manufacturers.12 TFT LCDs dominate today’s display markets, but new market opportunities in displays are opening up particularly in flexible displays. Today, the primary sources of innovation in flexible displays are in the United States, and forecasts suggest that this technology’s market share in mobile devices will grow in the next few years. Solar Cells As in the case of displays, manufacturing and innovation of solar photovoltaics (PVs) have their roots in the United States. As discussed by Colatat, Vidican, and Lester in the paper Innovation Systems in the Solar Photovoltaic Industry: The Role of Public Research Institutions, the first silicon photovoltaic device was invented in 1954 at Bell Laboratories and found a niche market in space satellites.13 The photovoltaic industry in the 1960s remained very small—the annual market of 10 National Research Council. 2008. Innovation in Global Industries. 11 Murtha, T.P., S.A. Lenway, and J.A. Hart. 2001. Managing New Industry Creation: Global Knowl- edge Formation and Entrepreneurship in High Technology—The Race to Commercialize Flat Panel Displays. Stanford, Calif.: Stanford University Press. 12 Murtha et al. 2001. Managing New Industry Creation. 13 Colatat, P., G. Vidican, and R. Lester. 2009. Innovation Systems in the Solar Photovoltaic Industry: The Role of Public Research Institutions. Massachusetts Institute of Technology Industrial Performance Center Working Paper Series. Cambridge, Mass.: Massachusetts Institute of Technology.
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190 Optics and Photonics: Essential Technologies for O u r N at i o n solar cells was worth $5 million to $10 million, or the equivalent of 50 to 100 kW of capacity—and the U.S. government was the primary customer.14,15 Throughout the 1950s and 1960s, only five companies produced photovoltaic cells. Two were start-ups: Hoffman Electronics, which acquired National Fabricated Products and its patent license for the Bell Laboratories patents, and Heliotek, founded by Al- fred Mann as a spin-off from his previously founded company, Spectrolab.16 The remaining three entrants were established companies that had diversified into the solar cell market: RCA (which produced radios), International Rectifier (which produced semiconductors), and Texas Instruments (which produced semiconduc- tors). All three of the established companies left the market by the end of the 1960s because it was small and unpredictable.17 In 1973, the Arab oil embargo strengthened interest in terrestrial applications of photovoltaics and expanded the market for them.18 Two well-known U.S. PV firms were founded shortly thereafter by former employees of Spectrolab: Solar Technology International (1975) and Solec International (1976).19,20 Between the mid-1980s and the mid-1990s, the United States, Japan, and Germany competed for the lead in solar cell production on the basis of the location of production activities. In the mid-1980s, Japan overtook the United States as the number one producer of solar cell modules, with Germany in a distant third place. The United States and Germany then surpassed Japan in world PV module shipments in the mid-1990s. Since the 1995, however, although U.S. production of PVs has risen, the U.S. share of global PV production has fallen from its 43 percent peak in 1995 to an all-time low of 6 percent in 2009.21 (See Figure 7.2 (b).) As of 2009, Germany is the leader 14 Colatat et al. 2009. Innovation Systems in the Solar Photovoltaic Industry. 15 National Research Council. 1972. Solar Cells: Outlook for Improved Efficiency. Washington D.C.: National Academy Press. 16 Colatat et al. 2009. Innovation Systems in the Solar Photovoltaic Industry. 17 Colatat et al. 2009. Innovation Systems in the Solar Photovoltaic Industry. 18 Colatat et al. 2009. Innovation Systems in the Solar Photovoltaic Industry. 19 Colatat et al. 2009. Innovation Systems in the Solar Photovoltaic Industry. 20 Although both firms are still in operation, both were eventually acquired by non-U.S. compa- nies. Solar Technology International was acquired by Atlantic Richfield Company (ARCO) in 1977 and renamed ARCO Solar. By the time it was acquired by Siemens (a German company) in 1990, ARCO Solar was the largest PV manufacturer in the world. ARCO Solar was later sold by Siemens to an Anglo-Dutch company, Shell, before being sold to Solarworld (a German company). Solec Inter- national, which was eventually sold to Sanyo (a Japanese company), is also still in operation today. 21 Le, Minh, Chief Engineer, Solar Energy Technologies Program, U.S. Department of Energy. 2011. “The SunShot Program—The Great Solar Race: The Apollo Mission of Our Times.” Presentation to the NRC Committee on Harnessing Light: Capitalizing on Optical Science Trends and Challenges for Future Research, February 24, 2011.
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A d va n c e d M a n u fa c t u r i n g 191 (a) (b) FIGURE 7.2 (a) U.S. share of global patenting. SOURCE: Reprinted, with permission, from Andersson, B.A., and S. Jacobsson. 2000. Monitoring and assessing technology choice: The case of solar cells. Energy Policy 28(2000):1037-1049. (b) U.S. share of global PV cell module market and production. SOURCE: Le, Minh, Chief Engineer, Solar Energy Technologies Program, U.S. Department of Energy. 2011. “The SunShot Program—The Great Solar Race: The Apollo Mission of our Times.” Presentation to the NRC Committee on Harnessing Light: Capitalizing on Optical Science Trends and Challenges for Future Research, February 24, 2011.
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192 Optics and Photonics: Essential Technologies for O u r N at i o n in global production of PV followed by China, with Japan in third place.22 But the growth of international production means that three of the top five manufacturers of PV modules (measured in megawatts of shipments23) in 2010 were Chinese. The firm in second place on the basis of its volume (megawatts) of shipments at the end of the fourth quarter of 2010 is First Solar, a U.S. thin-film PV company that uses cadmium telluride instead of silicon (the material used by all 9 other compa- nies in the top 10) as its semiconductor. First Solar has manufacturing facilities in Perrysburg, Ohio; Frankfurt, Germany; and Kulim, Malaysia. There are no other U.S. companies in the top 10. The Japanese company Sharp is in fourth place, and a Canadian company, Canadian Solar, is in sixth place. The top 10 manufacturers accounted for more than 50 percent of total global PV shipments in 2010.24 Although the United States no longer dominates global production of solar modules, it has maintained its lead in patenting in solar technologies,25 followed by Japan (according to the geographic location reported by the corporate assignees on the patent). As can be seen in Figure 7.2, the United States was the dominant source of solar technology patents during 1975-1995, although Japan’s share of global patenting increased significantly after 1980.26 The United States retains a position of leadership in solar-related USPTO patents, accounting for 52 percent of total solar patents in 2002-2010, followed by Japan at 26 percent and Germany at 6 percent.27 The 10 leading corporate patentees during 2002-2010 were (in order) Canon (Japanese), Sharp (Japanese), Boeing (U.S.), Sunpower (U.S.), Kanegafuchi (Japanese), Sanyo (Japanese), Emcore (U.S.), Applied Materials (U.S.), Konarka (U.S.), and Rabinowitz (U.S.).28 As this discussion suggests, the United States no longer is among the leading 22 Le, Minh, Chief Engineer, Solar Energy Technologies Program, U.S. Department of Energy. 2011. “The SunShot Program—The Great Solar Race: The Apollo Mission of Our Times.” Presentation to the NRC Committee on Harnessing Light: Capitalizing on Optical Science Trends and Challenges for Future Research, February 24, 2011. 23 The conditions for measuring the nominal power of a photovoltaic module are specified in standards such as IEC 61215, IEC 61646, and UL 1703; the term “power” is also used in describing the size of a shipment or an installation. 24 PVinsights. 2011. “Suntech Lost Championship of Solar Module Shipment to First Solar in 2Q 11.” Available at http://pvinsights.com/Report/ReportPMM31A.php. Accessed December 27, 2011. 25 The above-described data are based on shares of patents in the U.S. Patent and Trademark Of- fice database. Past research suggests that U.S. patents are a reasonable measure of unique inventive activity worldwide by internationally competitive companies. Here, patent locations are assigned on the basis of company assignee location, as reported in the filed patent. 26 Andersson, B.A. and S. Jacobsson. 2000. Monitoring and assessing technology choice: The case of solar cells. Energy Policy 28(14):1037-1049. 27 Cardona, V. 2011. “Clean Energy Patents—Winners and Losers, Renewable Energy World.” Avail- able at http://www.renewableenergyworld.com/rea/news/print/article/2011/03/2010-clean-energy- patents-winners-and-losers. Accessed July 5, 2011. 28 Cardona, V. 2011. “Clean Energy Patents—Winners and Losers, Renewable Energy World.”
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A d va n c e d M a n u fa c t u r i n g 193 sites (by volume) for the manufacturing of solar modules.29 Notable is the apparent lack of correlation between the nations in which the bulk of solar module manu- facturing is sited and the nations that dominate inventive activity (as measured by USPTO patenting). (See Figure 7.2 (b).) Indeed, the United States continues to dominate global inventive activity in solar technologies despite not being the location for the greatest volume of solar module manufacturing output. (See Fig- ure 7.2 (a).) Notably, the largest volume in the world of patents is in cutting-edge solar technologies, such as thin films, which are still produced largely in the United States. In contrast, the largest volume of manufacturing is in crystalline silicon technology modules—a technical field that no longer dominates solar technology patenting in the USPTO. Innovation in the materials that underpin solar technologies used for energy generation may prove important in affecting the future site of manufacturing activity in this field. Numerous materials and designs can produce photovoltaic effects.30 Overall, PV technologies can be grouped into four main categories: wafer and thin film (including crystalline and amorphous silicon and cadmium telluride technologies), concentrator, excitonic (including organic polymer and dye-sensitized solar technologies), and novel, high-efficiency technologies (such as plasmonics).31 Designs based on crystalline silicon have dominated commercial PV technology, accounting for more than 80 percent of the market for commer- cial modules since the industry’s origin.32 Crystalline silicon may not, however, be the future. Today, thin-film solar technologies hold the second-largest proportion of the commercial market after crystalline silicon, hovering below 20 percent.33 In the 1980s, both the United States and Japan invested in thin-film amorphous silicon technologies.34 One report finds that between 1994 and 1998 the number of USPTO patents granted in amorphous silicon exceeded the number granted in crystalline silicon.35 A more recent report based on National Renewable Energy Laboratory data concluded that the cost per watt of producing thin-film PV was closing the gap with the cost of producing crystalline PV in the late 1990s and early 29 Atthe firm level, one U.S.-headquartered firm is among the corporate leaders (by volume) in global manufacturing of solar modules. However, the national headquarters of the corporate entities that dominate solar manufacturing may not correlate with the geographic location of those corpora- tions’ manufacturing activities. 30 Baumann, A., Y. Bhargava, Z.X. Liu, G. Nemet, and J. Wilcox. 2004. Photovoltaic Technology Review. Berkeley, Calif.: University of California, Berkeley. 31 Curtright, A.E., M.G. Morgan, and D. Keith. 2008. Expert assessment of future photovoltaic technology. Environmental Science and Technology 42(24): 9031-9038. 32 Baumann et al. 2004. Photovoltaic Technology Review. 33 PVinsights. 2011. “Suntech Lost Championship of Solar Module Shipment to First Solar in 2Q 11.” Available at http://pvinsights.com/Report/ReportPMM31A.php. Accessed December 27, 2011. 34 Baumann et al. 2004. Photovoltaic Technology Review. 35 Andersson and Jacobsson. 2000. Monitoring and assessing technology choice.
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194 Optics and Photonics: Essential Technologies for O u r N at i o n 2000s.36 However, even in-depth assessments find it difficult to assess which of the thin-film or the many other PV material and design technologies may be dominant in the future.37 Inasmuch as the basic materials underpinning solar technologies are likely to undergo considerable change, it is possible that U.S.-based innovation can lead to expanded U.S.-based production of new technologies in this field. Optoelectronic Components for Communications Systems Optoelectronic components—which include lasers, modulators, amplifiers, photodetectors, and waveguides produced on semiconductors—are the compo- nents necessary to send and receive information in light-based communications systems. The origins of this technology can be traced to the 1960 demonstration of the laser at Hughes Aircraft that followed from research at Columbia University and AT&T Bell Laboratories (see Chapter 2 for further discussion). Further research and development (R&D), much of it at Bell Laboratories, yielded the fabrication methods by which fiber and the other system-critical optoelectronic components could be manufactured economically. In 1970, Corning was the first firm to develop the optical waveguide technology—in particular, low-loss optical fiber that would prove critical to the development of optoelectronics. Corning entered into joint- development cross-licensing agreements with AT&T and cable suppliers in Europe and Japan. By 1986, several other giant corporations had begun production of fiber optics and related components, including DuPont, ITT, Allied Signal, astman E Kodak, IBM, and Celanese. Large Japanese corporations, including Nippon Electric Company, made similar investments.38 The 1984 consent decree that resolved the federal antitrust suit against AT&T produced dramatic changes in the structure of R&D and manufacturing in the U.S. communications industry, and these changes affected the development of optoelectronics in the United States. In 1996, AT&T spun off Bell Laboratories with most of its equipment manufacturing business into a new company named Lucent Technologies. In 2006, Lucent signed a merger agreement with the French company Alcatel to form Alcatel-Lucent. On August 28, 2008, Alcatel-Lucent announced that it was pulling out of basic science, material physics, and semiconductor research to work in more immediately marketable fields.39 During the 1990s, many small and medium-size optoelectronic component 36 Baumann et al. 2004. Photovoltaic Technology Review. 37 Curtright et al. 2008. Expert assessment of future photovoltaic technology. 38 Sternberg, E. 1992. Photonic Technology and Industrial Policy: U.S. Responses to Technological Change. Albany, N.Y.: State University of New York Press. 39 Ganapati, Priya. 2008. Bell Labs kills fundamental physics research. Wired Magazine. August 27. Available at http://www.wired.com/gadgetlab/2008/08/bell-labs-kills/. Accessed November 12, 2012.
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A d va n c e d M a n u fa c t u r i n g 195 manufacturers for communications were founded in the United States.40 In March 2000, however, the telecommunications bubble burst, throwing the industry into turmoil. By 2002, optical fiber sales had fallen short of monthly projections by more than 80 percent,41 and competitive survival of producers of fiber and com- ponents required that they reduce production costs rather than develop novel technologies.42 The collapse of the U.S. telecommunications equipment market led to dra- matic change in the location of optical components production. Between 2000 and 2006, the majority of optoelectronic component manufacturers moved manufac- turing activities from the United States to developing countries, in particular to developing East Asia.43 By 2005, five U.S.-based companies (Agilent Technologies, JDSUniphase, Bookham, Finisar, and Infineon) and two Japanese-based companies (Mitsubishi and Sumitomo Electric/ExceLight) accounted for 65 percent of rev- enues in optoelectronic components.44 All five of the top U.S. manufacturers had moved assembly activities to East Asia, and all but JDSUniphase had also moved some or all of their fabrication activities to East Asia. The offshore production activities of these U.S. firms did not rely on contract manufacturers, instead pro- ducing components in wholly owned foreign subsidiaries. Only a few U.S. entities, mainly start-ups relying on funding from venture capitalists or Small Business Innovation Research (SBIR), chose to keep all manufacturing in the United States. Included among these start-ups were Infinera, Kotura, and Luxtera. Despite these changes in the location of manufacturing, as can be seen in Fig- ure 7.3, the United States has maintained a dominant role in total optoelectronics patent production as measured by USPTO data, with Japan a close second. In the 4-year period (2001-2004) after the bursting of the telecommunications and Internet bubble, U.S. patents filed annually by assignees in the United States fell while U.S. patenting during the same period by assignees in Japan continued to rise. Although those data depict trends in issued patents, which have to pass a formal review for novelty and non-obviousness by USPTO examiners, they do not adjust for the fact that the economic or technological importance of individual patents varies widely. Nor do these patent data indicate the location of the inventive activity 40 Yang, C., Nugent, R., and Fuchs, E. 2011. Gains from Other’s Losses: Technology Trajectories and the Global Division of Firms. Carnegie Mellon University Working Paper. Available at http://papers. ssrn.com/sol3/papers.cfm?abstract_id=2080595. Accessed November 12, 2012. 41 Fuchs, E.R.H., E.J. Bruce, R.J. Ram, and R.E. Kirchain. 2006. Process-based cost modeling of photonics manufacture: The cost competitiveness of monolithic integration of a 1550-nm DFB laser and an electroabsorptive modulator on an InP platform. Journal of Lightwave Technology 24(8):3175-3186. 42 Fuchs et al. 2006. Process-based cost modeling of photonics manufacture. 43 Yang et al. 2011. Gains from Other’s Losses. 44 Fuchs et al. 2006. Process-based cost modeling of photonics manufacture.
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A d va n c e d M a n u fa c t u r i n g 215 FIGURE 7.12 A stereolithographed chess piece. SOURCE: Courtesy of Potomac Photonics. material is needed for the part. The laser wavelength and power can vary between manufacturers but is approximately 325 nm from a low-power He-Cd source. The part is built up in layers until the final geometry is completed. On completion of the layering process, the part is subjected to high-intensity UV light for the postcuring process, which fully hardens the resin. A chess piece fabricated with stereolithography is shown in Figure 7.12. Selective Laser Sintering Selective laser sintering (SLS) was developed in the mid-1980s and is capable of producing parts from thermoplastics, ceramics, or metals. Like stereolithography, SLS, shown in Figure 7.13, is a layering process that builds a part from a powder based on a three-dimensional CAD model. In the SLS process, a laser fuses the layers of powder in localized areas to create the final part geometry. Although systems vary between manufacturers, the laser used is approximately a 50-W CO2 laser. The process can yield very accurate parts with tolerances of ±0.05-0.25 mm. Components fabricated with SLS require no postprocessing. Figure 7.14 shows a replica of a violin produced with the SLS process.
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216 Optics and Photonics: Essential Technologies for O u r N at i o n FIGURE 7.13 Selective laser sintering (SLS) schematic. SOURCE: Image by Materialgeeza. FIGURE 7.14 Martha Cohen, of the Hochschule für Musik und Theater, München, plays a replica of a Stradivarius violin fabricated with SLS during the Kleine Zukunftsmusik der Photonik event. SOURCE: Erik Svedberg, National Research Council.
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A d va n c e d M a n u fa c t u r i n g 217 Laser Engineered Net Shaping Laser Engineered Net Shaping (LENS™) was developed in the mid-1990s at the Sandia National Laboratories. The process, shown in Figure 7.15, uses a neodymium-doped yttrium aluminum garnet (Nd:YAG) laser operating at 500-600 W that is enclosed in an argon gas environment. The laser creates a molten pool into which powdered metal is injected. Parts have been produced from stainless- steel alloys, nickel-based alloys, tool-steel alloys, titanium alloys, and other specialty materials, including composites. As in other additive-manufacturing processes, parts originate from three-dimensional CAD models, and material is built up in layers to create the final part. The significant difference between LENS and other additive processes is that the parts obtain the same density as the metal used to fabricate them. Figure 7.16 shows a tool produced with the LENS process. FIGURE 7.15 Laser Engineered Net Shaping (LENS™) process schematic. SOURCE: Worldwide Guide to Rapid Prototyping Website, © Copyright Castle Island Co., all rights reserved. Available at http:// www.additive3d.com/len_int.htm. Reprinted with permission.
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218 Optics and Photonics: Essential Technologies for O u r N at i o n FIGURE 7.16 H13 tooling created with LENS™ process. SOURCE: Courtesy of Sandia National Laboratories. A common opportunity exists among these techniques to increase the preci- sion of three-dimensional manufacturing. If shorter-wavelength lasers and imag- ing were available, it would be possible to reduce the scale of the smallest-possible three-dimensional voxel (a three-dimensional pixel). In general, one important part of additive manufacturing is an increased em- phasis on in situ metrology that uses coherent optics (interference) for feedback and control, especially when the dimensions of parts shrink. Pattern-placement metrology, used ordinarily for lithographic purposes, can rely on phase-coherent fiducial gratings patterned by interference lithography.70 Potential uses include measuring process-induced distortions in substrates, patterning distortions in pattern-mastering systems, and measuring field distortions and alignment errors in steppers and scanners. For example, spatial-phase-locked electron-beam lithog- raphy has been implemented to correct pattern-placement errors at the nanometer level.71 70 Schattenburg, M.L., C. Chen, P.N. Everett, J. Ferrera, P. Konkola, and H.I Smith. 1999. Sub-100 nm metrology using interferometrically produced fiducials. Journal of Vacuum Science and Technology B: Microelectronics and Nanometer Structures 17(6):2692-2697. 71 Hastings, J.T., F. Zhang, and H.I. Smith. 2003. Nanometer-level stitching in raster-scanning electron-beam lithography using spatial-phase locking. Journal of Vacuum Science and Technology B: Microelectronics and Nanometer Structures 21(6):2650-2656.
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A d va n c e d M a n u fa c t u r i n g 219 PHOTONICS AND THE FUTURE OF U.S. MANUFACTURING As noted earlier, U.S.-based manufacturing now accounts for a smaller share of global manufacturing value added than 20 years ago. The drive for competitive- ness and increased shareholder value has caused corporations in nearly every area of photonics to search for alternative manufacturing locations. The exception may be products that have substantial defense-related markets and applications and that therefore are subject to controls over their export (International Traffic in Arms Regulations, ITAR). But government licensing has allowed “offshoring” for some components in this product field as well. During the same period, however, some components continue to be manufactured in the United States and have remained competitive. What distinguishes the components and final assemblies whose production has remained in the United States from those now produced mainly offshore? A critical factor affecting the location of production is volume. Typically, high- volume production operations are more sensitive to labor and capital cost differ- entials, and these activities have been among the most likely to move offshore from the United States in photonics and other high-technology products. In photonics, as in other high-technology industries, high-volume production operations are most common in consumer products, and low-volume operations range from the production of test lots to the manufacture of specialized systems. Advances in optical materials and processing have enabled the manufacture of precision optical components for very low cost with sufficient volume to amortize the required tooling. One example is the mass production of molded polymer aspheres. Their unit costs can be very low as long as the volume is sufficiently high. Low-volume production of these components, however, tends to be expensive because of the large amounts of labor and time required to manufacture and test precision tools. Even when advanced capabilities are used in a highly automated manufacturing process, the cost of the equipment coupled with low volume drives production costs up significantly. Recent advances in several manufacturing capa- bilities, such as different methods of additive manufacturing, hold out considerable promise for the development of low-cost machines capable of providing precision optics, with surface figures not restricted to the narrow range of surfaces possible with current grinding and finishing techniques. In addition to providing a new set of potential optical surface figures and the associated capabilities, these advances may enable low-cost precision optics even for low-volume applications and thereby remove much of the benefit of moving optics manufacturing overseas by minimiz- ing the impact of labor costs on the optics. Photonics-enabled advances in manu- facturing technology thus could slow the erosion, or perhaps support renewed growth, in U.S.-based manufacturing activity.
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220 Optics and Photonics: Essential Technologies for O u r N at i o n High-Volume Products High-volume products, particularly consumer retail products, generally have cost as a high priority and tend to use manufacturing processes focused on pro- duction cost minimization. Manufacturing processes that minimize labor and infrastructure costs are preferred. U.S. manufacturers have, over the years, had difficulty in competing in the high-volume market and have seen much of this work move offshore. That move has been driven in large part by the cost of labor in the United States, which is reflected in raw materials, operations, and overhead. In an effort to compete in at least a portion of the high-volume market (the lower-volume portion of the high-volume market), U.S. manufacturers have used a variety of strategies. For example, manufacturers have changed from commodity components and moved toward precision components and subassemblies in their U.S.-based operations. The high-volume sector tends to be very cost-sensitive, but the lower-volume end of this sector is somewhat less so. In addition to focusing on products that are less cost-sensitive, manufactur- ers have reduced the amount of direct labor in their U.S.-based manufacturing processes. In optics grinding and polishing operations, such as lens centering, use of CNC equipment capable of running unattended, as shown in Figure 7.17, has FIGURE 7.17 Automated lens handling. SOURCE: Courtesy of Rochester Precision Optics.
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A d va n c e d M a n u fa c t u r i n g 221 helped to reduce the amount of labor at the component level. In polymer lens molding, the use of automation to remove parts from molds, degate those parts, and the use of molds with higher cavitation, has reduced per part cost and im- proved competitiveness. Those cost-saving strategies can be capital-intensive, and manufacturers must evaluate the associated economics case by case. The purchase, installation, and maintenance costs of labor-saving equipment must be offset by actual labor savings to justify expenditures. Low-Volume Products Low-volume products are generally high-precision and complex or subject to export restrictions linked to national security concerns, as in the case of ITAR. ITAR thus has offsetting effects on the location of innovation and production for U.S. firms. On the one hand, restrictions on export of ITAR-controlled products may lead U.S. firms to site their self-financed product development activities for these products offshore to avoid the restrictions; at least some types of innovation may move offshore from the United States as a result of ITAR. On the other hand, the production of ITAR-controlled products, especially products based on R&D that draw on defense-funded programs or products that are sold in large part to federal agencies, may be less likely to move offshore because of ITAR restrictions on procurement of such products from foreign producers or foreign production sites. Products not subject to ITAR in the low-volume sector are often in early-stage development and require prototypes or are products in the medical industry, such as complex Lasik surgery equipment. A common characteristic of these products is the requirement for tightly specified precision optical components; emphasis is placed on consistently and reliably satisfying difficult specifications. Although cost is always an important element with all products, it often falls behind the require- ment for precision and reliability. U.S. manufacturers have excelled in the production of low-volume, high- precision optical components and devices. Manufacturers have successfully pushed legacy technologies and adopted newer technologies to satisfy the requirements of this segment. Precision CNC equipment capable of producing components repeat- edly and accurately is in wide use. Assembly processes that often require active alignment are used to enable compliance with the requirement for tight tolerances. Complex precision metrology is used for testing components and assemblies to ensure that specifications are met. THE U.S. MANUFACTURING WORKFORCE It is the judgment of this committee that advances in photonics provide clear potential for growth in U.S.-based manufacturing by (1) expanding the ap-
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222 Optics and Photonics: Essential Technologies for O u r N at i o n plications of photonics throughout manufacturing and thereby improving the cost-competitiveness of processes used to produce high-volume products, (2) accelerating the commercial exploitation of new photonics-based technological opportunities, and (3) improving the cost-competitiveness of U.S. manufacturing of photonics products and components. Realizing that potential, however, requires a well-trained manufacturing work- force that includes both advanced-degree holders and skilled operators and crafts- people. As was discussed in previous chapters, because of the nature of photonics as a technology rather than an industry on which data are collected by U.S. gov- ernment statistical agencies, the committee was not able to assemble estimates of current employment in photonics-enabled production activity, nor was it able to forecast growth for various occupations within this sector.72 The collection and reporting of better employment data in photonics will be important for any future federal initiative in this field. Nonetheless, it is the judgment of the committee that U.S. holders of ad- vanced degrees from university-based programs in photonics, optics, and related disciplines too often pursue careers in R&D or academia rather than pursue op- portunities in design or manufacturing within industry. It is important that U.S. firms develop more attractive career paths for advanced-degree holders to pursue careers in photonics manufacturing and in the applications of photonics technolo- gies throughout manufacturing. Some committee members cited the example of the U.S. semiconductor indus- try as one that has developed attractive employment opportunities in manufactur- ing for engineering and science advanced-degree holders. That industry seems to have experienced fewer problems in recruiting top graduates into manufacturing process development, perhaps because leading firms recognize its significance and are willing to make manufacturing jobs attractive by acknowledging that manu- facturing is a key ingredient in their competitive advantage. Similarly, the committee concluded that improvements in technical educa- tion are needed to increase the quality of skilled blue-collar workers in optics and photonics. Although U.S. community colleges provide abundant opportuni- ties for students to pursue technical education, there are fewer opportunities for apprenticeship-based training in the U.S. optics industry than in similar industries 72 Although Chapter 2 presents rough estimates of employment in U.S. firms that are active in pho- tonics, based on their membership in professional or trade organizations, the committee notes in that discussion that such estimates do not represent measures of “photonics-dependent” employment, nor do they enable an analysis of employment prospects or current shortages of skilled workers, scientists, or engineers in photonics-related production or applications. Chapter 4 discusses concerns about the effects of impending retirements and the small pool of U.S. nationals with advanced degrees available for employment in defense-related production and R&D activities, although here, too, precise data on the implications of these trends for photonics applications are lacking.
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A d va n c e d M a n u fa c t u r i n g 223 in Germany. The difficulties of expanding a skilled technical workforce in the United States are considerably exacerbated by the declining performance of U.S. primary and secondary education.73,74 It is, of course, true that weaknesses in the quality and quantity of the skilled blue-collar workforce in the United States can be partially compensated for by expanded investment in automation. But even the intelligent deployment of more highly automated manufacturing processes will be hampered by weaknesses in the skilled workforce in U.S. manufacturing. FINDINGS Finding: Production of many photonics applications—such as TFT displays, solar modules, and optoelectronic components for communications systems, most of which were first developed and commercialized by U.S. firms in the U.S. econ- omy—now is dominated by foreign production sites, even when these production activities are still controlled by U.S.-based firms. The effects of this offshore move- ment of manufacturing on innovation in photonics, however, vary considerably among different sectors and technologies within photonics. Indeed, the United States remains the leading source of USPTO patents in two key sectors of photon- ics (solar and communications components) and is the leader in potential next- generation technologies, such as flexible displays, “paint-on” and other thin-film solar cells, and monolithically integrated optoelectronic devices. Key Finding: To enable the United States to be productive in manufacturing pho- tonics goods, a capable and fully trained workforce must exist at all levels, includ- ing shop floor associates, technicians, and engineers. Because photonics is not yet recognized as an industry and data are not tracked in a way that facilitates analysis, it is difficult to evaluate the extent of personnel shortages in photonics manufactur- ing and in applications of photonics elsewhere in the manufacturing industry in general. It seems that it would be beneficial if industry and government did more to increase training and employment opportunities in photonics manufacturing. Key Finding: Additive manufacturing, which uses significant optics and photonics technologies, has become important in manufacturing, and its position is expected to increase. Additive manufacturing tends to require low labor use and is therefore advantageous in regions with high labor costs, such as the United States. 73 National Research Council. 2010. Standards for K-12 Engineering Education? Washington, D.C.: The National Academies Press. 74 National Research Council. 2011. Successful STEM Education: A Workshop Summary. Washing- ton, D.C.: The National Academies Press.
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224 Optics and Photonics: Essential Technologies for O u r N at i o n RECOMMENDATIONS AND GRAND CHALLENGE QUESTION Key Recommendation: The United States should aggressively develop additive- manufacturing technology and implementation. Current developments in the area of lower-volume, high-end manufacturing include, for example, three-dimensional printing, also called additive manufactur- ing. With continued improvements in manufacturing tolerances and surface finish, additive manufacturing has the potential for substantial growth. The technology also has the potential to allow three-dimensional printing near the end user no matter where the design is done. Key Recommendation: The U.S. government, in concert with industry and aca- demia, should develop soft x-ray light sources and imaging for lithography and three-dimensional manufacturing. Advances in table-top sources for soft x rays will have a profound impact on lithography and optically based manufacturing. Therefore, investment in these fields should increase to capture intellectual property and maintain a leadership role for these applications. The committee views development of soft x-ray light sources and imaging as an appropriate field for expanded federal R&D funding under the sponsorship of a national photonics initiative undertaken with the ad- vice and financial support of U.S. industry. This chapter indicates the need for an order-of-magnitude or greater increase in resolution in manufacturing. The above two key recommendations help to inform the fifth and last grand challenge question: 5. ow can the U.S. optics and photonics community develop optical sources H and imaging tools to support an order of magnitude or more of increased resolution in manufacturing? Meeting this grand challenge could facilitate a decrease in design rules for lithography, as well as providing the ability to do closed-loop, automated manufac- turing of optical elements in three dimensions. Extreme ultraviolet is a challenging technology to develop, but it is needed in order to meet future lithography needs. The next step beyond EUV is to move to soft x rays. Also, the limitations in three- dimensional resolution on laser sintering for three-dimensional manufacturing are based on the wavelength of the lasers used. Shorter wavelengths will move the state of the art to allow more precise additive manufacturing that could eventually lead to three-dimensional printing of optical elements.
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A d va n c e d M a n u fa c t u r i n g 225 Recommendation: Industry and public (both federal and state) sources should ex- pand financial support for the training of skilled workers in photonics production and in applications of photonics-based technologies in manufacturing. The pho- tonics industry also should enhance incentives for holders of advanced degrees in photonics, optics, physics, and related fields to pursue employment opportunities in manufacturing. One potential vehicle for such expanded support and for needed improvements in data collection on photonics employment trends at all levels is the federal initiative in photonics discussed in the recommendations of Chapter 2.