Panel VIII

Growing the Ohio Flexible Electronics Industry

Moderator:
Byron Clayton
NorTech

Dr. Clayton said that the discussion of regional clusters by the previous panel constituted a good introduction to this panel, with the growing importance of clusters to the northeast Ohio region. He said that the presentations would be brief so as to leave time for more general discussion on what collaboration can do for a region and an industry.

He began with a “quick definition” of flexible electronics as “simply electronic devices that are printed on flexible materials.” This includes plastics, paper, and even fabrics, he said, and any other ways of making electronic devices “flexible, rollable, wearable, or formable.” It also makes devices less costly to manufacture than traditional forms of electronics, as well as more durable and more energy-efficient.

“If you think of all the ways electronics touch you today,” Dr. Clayton said, “just wait a few years, when electronics, specifically flexible electronics, will be in virtually everything you do. It will be in clothing, walls, and architecture. My personal favorite is electronic wallpaper. For those who hate to paint, imagine the time when you’re ready for a new wallpaper and all you have to do is press a button; there are different colors, different patterns.” The appeal of such products, he said, is why experts predict that the market for flexible electronic products may reach $250 billion by the year 2025.

“The good news for Ohio,” he said, “is that we have established world-class core competencies in not only the materials and the technology, but also in the manufacturing of flex electronics. And more good news is that there’s time for us to position ourselves to compete globally. The bad news is that even our world-class capabilities are still not going to be enough.” He referred to Dr. Wessner’s comments about how hard other countries are working. “We’re going to have to be even smarter about how we go about building our industries.”



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PROCEEDINGS 117 Panel VIII Growing the Ohio Flexible Electronics Industry Moderator: Byron Clayton NorTech Dr. Clayton said that the discussion of regional clusters by the previous panel constituted a good introduction to this panel, with the growing importance of clusters to the northeast Ohio region. He said that the presentations would be brief so as to leave time for more general discussion on what collaboration can do for a region and an industry. He began with a “quick definition” of flexible electronics as “simply electronic devices that are printed on flexible materials.” This includes plastics, paper, and even fabrics, he said, and any other ways of making electronic devices “flexible, rollable, wearable, or formable.” It also makes devices less costly to manufacture than traditional forms of electronics, as well as more durable and more energy-efficient. “If you think of all the ways electronics touch you today,” Dr. Clayton said, “just wait a few years, when electronics, specifically flexible electronics, will be in virtually everything you do. It will be in clothing, walls, and architecture. My personal favorite is electronic wallpaper. For those who hate to paint, imagine the time when you’re ready for a new wallpaper and all you have to do is press a button; there are different colors, different patterns.” The appeal of such products, he said, is why experts predict that the market for flexible electronic products may reach $250 billion by the year 2025. “The good news for Ohio,” he said, “is that we have established world- class core competencies in not only the materials and the technology, but also in the manufacturing of flex electronics. And more good news is that there’s time for us to position ourselves to compete globally. The bad news is that even our world-class capabilities are still not going to be enough.” He referred to Dr. Wessner’s comments about how hard other countries are working. “We’re going to have to be even smarter about how we go about building our industries.”

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118 BUILDING THE OHIO INNOVATION ECONOMY ADVANTAGES OF A CLUSTER APPROACH One of the ways to be smarter, he said, is to use the cluster approach. The northeast Ohio cluster created through NorTech is called FlexMatters, a term coined by Dr. West in 2006. The cluster includes partnerships throughout the value chain among universities, community colleges, small businesses, large businesses, potential end users, economic development organizations, and others. FlexMatters focuses specifically on five areas: technology innovation, capital attraction, supply chain building and networking, talent development, and market development. “Collaborating around all those areas,” he said, “is what it will take for us to compete on the world stage.” Dr. Clayton characterized the mix of panel members as “a core subset of the FlexMatters cluster,” including representatives of two universities and two manufacturing companies. “This is an example of real-world industry- university collaboration,” he said. “I’m not talking about just a collaboration that comes together when it’s time to go after a grant. This is a collaboration of organizations that have been working together for years on projects from basic research through technology development all the way to commercialization. This kind of core can drive the prosperity of entire regions.” THE GENESIS OF A NEW CLUSTER John West Kent State University Dr. West began by summarizing several themes already addressed in the symposium, notably the extent of regional collaboration and the effectiveness of the cluster in building on innovation. He said that the region is presently the leader in flexible electronics—“we’re simply the best in polymers and liquid crystals.”17 Logically, he continued, northeast Ohio should be “leading this new economic engine for the future.” The first companies in the world to do roll-to-roll manufacturing of liquid crystal displays are in northeast Ohio, he said and “LCDs are everywhere. It is the display of choice. I invite you to count the number of LCDs you use in your personal life.” The downside, he continued, is that “none of those LCDs are made in northeast OH; none are made in the U.S. The next generation is going to be flexible displays, and flexible electronics. We have to make sure this doesn’t happen again. We have the leadership now, and we should claim it, hold it, and have the vision for the future.” 17 He also cited Ken Werner, editor of Information Display, who wrote: “The only world-class center—in my opinion, at least—is Kent State University’s Liquid Crystal Institute.”

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PROCEEDINGS 119 FIGURE 7 Liquid crystal displays. SOURCE: John West, Presentation at the April 25-26, 2011, National Academies Symposium on “Building the Ohio Innovation Economy.” In reviewing the evolution of LCDs, he showed a slide of an early LCD watch display, which was made by a spin-off company of a researcher from the Liquid Crystal Institute. The researcher patented the technology, formed a startup company, and made the first LCD display in Kent, Ohio, and put it in the first digital wristwatch. That watch, now in the Smithsonian Institution, was “one of the top inventions of the last century in leading our new IT industry,” he said. “But we didn’t keep that lead. The visionaries in the year 1970 were talking about the TV on the wall. They didn’t have a clue about the iPhone.” The way technologies are going to come together and blend, he said, is through collaborations, which will be the mechanism that allows northeast Ohio to stay in control of this industry and build on its natural lead. “We are the MIT; we are the Stanford of this industry.” Leadership in Flex Electronics Through Collaboration Dr. West expressed how fortunate he was as a young researcher to be at the Liquid Crystal Institute, “the best place in the world for liquid crystal displays when it was still an industrial curiosity.” It has now become an industrial powerhouse, he said. “If you go anywhere in the world that is making LCDs, they’ll tell you that the Liquid Crystal Institute at Kent State is simply the best. We have the best researchers. We know how to translate technology from the laboratory to the marketplace. A number of the companies that are sitting here today used the resources of the Liquid Crystal Institute to get started.” He also emphasized the collaborations with the polymer expertise of the University of Akron and the Center for Layered Polymer Systems (CLPS) at Case Western Reserve. “We have the academic lead, we have the innovation, and we have the

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120 BUILDING THE OHIO INNOVATION ECONOMY ability to translate our research from laboratory curiosity into the reality of new companies. The challenges are some of the things we’ve been talking about today: How do we recognize this regional cluster? How does the Federal government make sure that it is supported? How do we attract enough venture capital support for the companies that are coming?” Dr. West said that his biggest concern was that northeast Ohio should not miss the current inflection point as it missed the IT boom. “We shouldn’t let that happen again. And I think the point at the table today is that the ring is coming around again. We have the new startup companies. We have the innovation within the universities. We need to strengthen this cluster with a collaborative approach and build this into an industry.” Dr. West closed by praising the expertise of his fellow panelists, and describing the breadth of the expertise they represented, from basic research to manufacturing and the next stages of innovation. “This is a collaboration that works,” he concluded. “The next steps will be to take our innovation skills to the next level in the form of this cluster, and be sure that we are the ones who grab the brass ring this time.” ROLE OF REGIONAL ACADEMIC INSTITUTIONS IN FLEXIBLE ELECTRONICS DEVELOPMENT Miko Cakmak The University of Akron Dr. Cakmak said he would begin with “a small sketch of what the academic institutions are doing to help promote the flexible electronics technologies in northeastern Ohio.” These institutions in partnership with regional companies, he said, have been working for almost seven years to develop the technologies and have collaborated on nearly $60 million worth of funding, primarily from the Ohio Third Frontier program. He followed Dr. West’s discussion in saying flexible displays are highly useful in a range of new devices, such as soft sensors for prostheses and other biomedical devices. Devices are made flexible through the use of polymers; in the case of biomedical devices, the demands are stringent, because the devices may have to be not only functional but also soft, stretchable, comfortable, and perhaps even biodegradable. “You may want the latter devices to perform a function for desired length of time and then disappear,” he said. “But that is still over the horizon.” A typical path to commercialization, he said, begins with a functional material sub-component. That includes the polymer, the primary base that will provide the flexibility, as well as other functionalities, such as electrical conductivity, piezo-electric capabilities, and magnetic properties magnetic properties in nanostructure form with functional materials. These materials can be produced by roll-to-roll manufacturing, “the bread and butter of polymer science and polymer engineering.” The state of the art today, he said, is to put

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PROCEEDINGS 121 the components into a device form in a much more precise way, requiring skilled people who assemble devices and eventually take them to market. A high priority is to reduce the impediments in technologies and in tech transfer processes in universities to commercializing these devices. New Materials: The Most Urgent Need The most urgent needs for the field, Dr. Cakmak said, are new materials. He said that many of his industrial colleagues had to compromise by using off-the-shelf materials. Finding materials for small-volume production was the most difficult. As an example, he cited the need for photo-functional materials for processing with light. He noted that roll-to-roll manufacturing, despite its promise to lower production costs, also involves expensive techniques, such as vacuum deposition that need to be eliminated in future generations through advances in material science that will allow direct atmospheric printing. Also, it will soon need shaping and forming operations for displays or devices with a double curvature or spherical devices that cover a face. This will require devices such as those made by Kent Displays and AlphaMicron and then stretching them into two- dimensional objects. “The materials will have to be able to take that reasonable amount of deformation,” he said. “You also need precision molding and a range of printing techniques and then roll to roll manufacturing technique to assemble the final devices. The Priority of Work Force Development Academia’s major contribution to this technology, Dr. Cakmak said, was workforce development, from the technician to the PhD level. “Flexible electronics companies are going to use fully automated machines that will be operated by people with advanced degrees.” He said that academic scientists in the region were already participating at the highest level. The technology would need photochemicals, he reiterated, and Scientists and Bowling Green State University, Center for Photochemical Sciences together with other regional institutions such as College of Polymer Science and Polymer Engineering at the Univ. of Akron, Liquid Crystal Institute of Kent State University are capable of designing new photocurable polymer precursors. This is a critical component, and one of the anchors that feeds into this technology.” He say that Dr. West had already described the contributions being made by Kent State in liquid crystals and other functional molecules, and that Case Western Reserve University had a polymer program that together with the University of Akron’s program was “literally the largest in the world.” The University of Akron specifically provides monomers and polymers in special designs, and the University of Akron has National Polymer Innovation Center for the roll-to-roll manufacturing.

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122 BUILDING THE OHIO INNOVATION ECONOMY Bottom-up Partnerships Between Academia and Business Obviously, Dr. Cakmak added, the academic programs need to be connected to the companies, and he specified KDI, AlphaMicron, Akron Polymer Systems, and Orbital Research, Parker Hanifin in Cleveland as existing R&D partners that take advantage of these linkages. He clarified that Akron Polymer Systems (APS) is a spin-off from the University of Akron which custom-designs molecules for new applications of liquid crystal displays. “They can turn on a dime to produce new molecules when someone needs them, unlike the large companies.” An additional component is Akron Polymer Training Center, specifically designed to educate technicians and engineers at the University of Akron campus. “Global Polymer Academy,” he said, “has an even a bigger vision that focuses on K-12 students and high school teachers. They also actually come to our campus for summer practices and interact with our graduate students.” The University of Akron has also invested matching funds in a new facility called the National Polymer Innovation Center, in partnership with Ohio State University and the University of Dayton, together with 85 companies. This center was part of an attempt to fill a specific technical need at commercial scale in roll-to roll-manufacturing. “We are literally providing this capability, which is called an electromagnetic processing line, to the industry and to anyone who would like to use our facilities. In this center science and engineering research R2R manufacturing is being carried out to enable these technologies through partnerships with regional institutions including NASA Glen and local industry. In closing, Dr. Cakmak reiterated that “our continuing priority in regional economic development through our academic institutions is work force development.” The university is changing its curricula to put more advanced elements, such as roll-to-roll manufacturing and photovoltaics, and flexible electronics, into advanced-level courses. A second priority is “to continue to identify and eliminate scientific and technological barriers to commercialization,” he said, “particularly for new material design, process design, and process modeling. Ultimately, what we need is hierarchical modeling from a molecular scale all the way to the end of the process. That’s an ultimate we are all striving for as academicians.” “This has all been a bottom-up approach,” he concluded. “We have just naturally reached out to each other and created these research and commercialization programs, led either by a company or a university.” ROLL-TO-ROLL MANUFACTURING OF FLEXIBLE DISPLAYS Albert Green Kent Displays Dr. Green, the chair of the FlexMatters steering committee, began by describing what may have been the most unusual product line discussed at the

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PROCEEDINGS 123 symposium, an LCD-based device called a “Boogie Board.” This is the first and best-known commercial product of Kent Displays, a company that was spun out of Kent State University’s Liquid Crystal Institute. The Boogie Board is an iPad-sized paperless writing tablet which lets the user make lists, draw doodles, or jot down thoughts using the included stylus, a fingernail, or any non-sharp object. It erases with the touch of a button, and the internal battery is rated at about 50,000 erasures. With virtually unlimited applications, it has appealed to users of every interest and is now inspiring a rush of sister products from Kent Displays. The Boogie Board was introduced in January 2010 and quickly became a hot seller around the world. Dr. Green said that Kent Displays would soon introduce a product line known as Reflex LCD Electronic Skins, which is also aimed at new markets. The electronic skins are ultra-thin, durable, single-pixel plastic displays that can be cut to a custom shape and conformed to a personal electronic device, such as an iPod, MP3 player, clothing, computers and peripherals, toys, and vehicles. No power is required from the host device to retain a displayed color image almost indefinitely. It is based on the company’s “Reflex” technology that allows for “no-power image retention.” According to the company, some Reflex displays have retained the same image without power for over 10 years with no degradation. New Products from Flex Electronics A new product introduced in the summer of 2011 is the Skin Flik LCD Color Changing Case, designed for the iPod Touch. Skin Flik changes the color and design of the case with a swipe of the finger. “We’re really excited about that and a roll-out of a few others in 2011 and then into 2012,” said Dr. Green. “This is a material that changes color depending on what you do to it electronically. That’s what all the Skin Flik and the e-skins products are able to do.” The company’s other products are equally high-tech, though aimed at more traditional existing markets. One is a color e-reader product, which is typically made under license to companies in Asia, and the other an e-card display used in credit cards. “It really has been an exciting year for us,” Dr. Green continued. “Within the next few weeks, we’re introducing three more products along these same lines. For anyone who thinks you can’t manufacture a consumer electronics product in northeast OH and sell it around the world, my response is: ‘Boogie Board.’ The U.S. is our largest market, and Japan is a close second. We have a lot of activities right now in Europe and all over.” The company is proud of its location in Kent, Ohio, where it now has about 100 employees. All of its products are based on RTR manufacturing, which, Dr. Green said, is fundamental to its success to date. “In many ways,” he said, “RTR manufacturing of displays is the holy grail of the display industry, and we’re happy to be a pioneer in that space, along with Bahman Taheri and

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124 BUILDING THE OHIO INNOVATION ECONOMY AlphaMicron.” The bottom line, Dr. Green said, is that the technology keeps both production and set-up costs very low. While a traditional LCD manufacturing plant typically costs a billion dollars or more, the Kent Displays production facility was built with a capital investment of several million dollars. MANUFACTURING OF CURVED LIQUID CRYSTAL DEVICES Bahman Taheri AlphaMicron Dr. Taheri said that while AlphaMicron and Kent Displays have a “very, very close working relationship,” their products and business models were “basically on the other side of the spectrum,” He said that while AlphaMicron and Kent Displays both work with liquid crystals, their approach is different. Kent Displays works on reflective systems, with the product able to reflect what is written on it. AlphaMicron works with transmissive systems, which control the light as it passes through them. The product line of his company extended across the consumer market, and into medical, military, automotive, and other sectors. The company was founded by a few faculty members at Kent State “and initially was more of a way to let us play around with the LCD technology.” As the company evolved, it changed its business model toward an infrastructure that could support different kinds of scientific research. It now has facilities for performing chemistry, lasers science, and optical physics, as well as processing, manufacturing, and design, including fashion design. The manufacturing capability was essential to “move into the next level of our world,” he said. The company is not funded by VCs; “we continuously support ourselves through this program, probably because they wouldn’t fund a bunch of physicists doing goofy work, but partly because we wanted to be able to do what we wanted to do.” That made for a long path to market for their products. Doing its Own In-house Research Its program started for the benefit of Air Force pilots, whose vision was affected when they flew into and out of clouds. Traditional windows and other translucent structures are made of flat glass, which was the company’s starting point. The Air Force needed a way to electronically control ambient light on a curved plastic visors. This was not yet available in eyewear or any other commercial product, so AlphaMicron had to develop new liquid crystal based functional film that could be applied to an existing pilots’ visors. The company had to do its own in-house chemistry and materials development, design its roll- to-roll production, and finally develop the ability to thermoform a liquid crystal device. This technology is now patented, said Dr. Taheri, and likely to have many applications.

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PROCEEDINGS 125 “This is a pretty big thing,” Dr. Taheri said. “Nobody in the world can put liquid crystals on curved by thermoforming without going through our patents.” The company’s development was supported by SBIR grants and 6.1 and 6.2 funding from the military, followed by a transition to Third Frontier programs in Ohio. Now it is supported by commercial partners who want development, licensing or an aspect of the technology. The company is developing eyewear for the Special Forces, who need to go in and out of buildings without changing goggles, and Navy jets that go in and out of clouds. They have made ski goggles with the same ability, as well as a motorcycle helmet. They were negotiating a contract with an automobile manufacturer to develop auto-dimming mirrors for cars, and hoped to develop car windows and architectural windows. “The point here is that this type of development has been collaborative,” Dr. Taheri concluded. “Our employees all came from Kent State University, and if they do leave, which they don’t, they would go to Al Green’s company, and anyone who leaves Al’s company comes to us.” DISCUSSION Sujai Shivakumar of the National Academies asked what the U.S. needs to do— given the sizeable flexible electronics programs in countries such as Germany, Korea, and Japan—to grow this technology in the U.S. and to develop a large domestic manufacturing industry around it. Dr. West said that the size of investments in the technology is an indicator that the next brass ring will be important. “Manufacturing is going to be the key issue,” he said. “We do have a lead, but that doesn’t mean we can sit on it.” He noted significant investments through the Third Frontier and the Federal government for basic research and early product development, but emphasized the need to invest in manufacturing. “Who controls the RTR manufacturing,” he said, “is going to control flexible electronics.” Dr. Taheri said that early progress had been made from the bottom up, and now it was time for top-down creation of a system that will “connect the individual parts that are distributive. The distributive knowledge base needs to be networked, both academically and industrially.” This could be done by a regional organization with reasonable funding, he said, so that when somebody comes in with an idea to create a business, he can be guided through the maze of complexities: material development, process development, process design, and skills. Through NorTech and the other regional institutions, he noted, a sufficient knowledge base exists. ‘What We Don’t Have is Money’ Dr. Clayton said that other countries are moving rapidly toward the cluster approach, specifically Germany and Taiwan. “I just spent five days in

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126 BUILDING THE OHIO INNOVATION ECONOMY Taiwan going through exactly what they’re doing,” he said. “They were gracious enough at ITRI to lead me through their entire process. I had 15 different meetings, and what we’re doing is the right thing. What we don’t have is the money. They are putting $600 million a year into different things, one of which is flexible electronics.” Dr. Wessner asked Dr Albert Green of Kent Displays how the small firms here could hope to compete with East Asia, given the vigor of government investments. Dr. Green said that his company was in the process of negotiating a joint venture with Taiwan, and that he knew the flexible electronics leaders at ITRI very well. He said he had also negotiated many contracts in this technology with Samsung and LG in South Korea. He said that Taiwan was currently the more formidable competitor, with Korea somewhat “distracted by their own LCD industry.” He said that the innovation culture in northeast Ohio, being “particularly American, does not translate well elsewhere, and they really do look to the U.S., and amazingly, to northeast Ohio, for leadership in these areas. It’s really staggering. So I agree that the challenge for us is to realize it’s not just the innovation part, which we do really well, but to translate that innovation into manufacturing and the expertise that goes out into the marketplace.” Dr. Taheri added that nobody can truly control the ultimate disposition of industries. “All these companies are evolving,” he said, “and you don’t know. Oakley is now owned by an Italian company, but the notion is that they’re still located here.” The issue, he said, “is not so much whether a foreign firm can come and buy us. If you create certain parts of a firm, then logistically it doesn’t make sense for some of those to move.” He said that AlphaMicron was working with a German-Canadian mirror company which plans to situate its plant near Michigan to save the expense of sending materials to Germany and back to the American market. “Those are market issues,” he said. “Who knows what they will do. The notion is to create opportunities, and then allow the market to decide which way it goes.” ‘A Window of Opportunity is Open, and We Could Seize This Industry’ Dr. West referred to his second slide, which showed the LCD digital wristwatch when it was first made, and pre-LCD televisions. “Think about companies that made TVs at that point. You won’t buy them from those companies today. It is the companies that had the patience and the diligence to see a new technology and to stick with it long enough to walk up the manufacturing curve. When that tipping point came, it was too late. I think we have an opportunity in RTR manufacturing, particularly if we have a few more years, to be quite a way down that innovation curve. We are the first doing the manufacturing. Our companies are learning how to do yields, put the product out into the marketplace at a low cost, manufacturing know-how that will be the basis of this industry. A window of opportunity is open, and we could seize this industry.”

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PROCEEDINGS 127 Dr. Clayton agreed that the market for flexible electronics was still “pre-demand. The bulk of the demand has not hit yet. But when it hits, people will be looking for which companies have the knowledge to actually manufacture these products. We want them to end up here.” A questioner asked whether the flexible electronics companies represented on the panel were joint ventures with the universities, and how the growth of the companies had been financed. Dr. Green said that Kent Displays raised early funding from many sources, primarily Manning Ventures, a VC firm in Rochester, New York. The company is now owned primarily by Manning Ventures, with Kent State University a small minority owner. Dr. Taheri said that AlphaMicron was not a joint venture with the university, although it was affiliated with it, and it does not have venture capital funding. “We actually raise funding and sell products,” he said. A Need for ‘Patience and Continued Investment’ Dr. Harris asked Dr. West if any valuable lessons had been learned from the first time Ohio missed the “inflection point” of the information technology boom. And he asked the panel more generally how the U.S. could compete with, for example, Taiwan, where the government simply invests in a technology if it wants to capture a market. Dr. West said several lessons had been learned. He said he had worked in two different industries, learning two different lessons. The first was the compact disc industry, where “a revolution happened overnight,” and major companies took over the industry in a year or two. The second was the LCD industry, where there were many opportunities in small markets, niche markets, and unexpected applications developed over the course of 40 years.” He said he thought the flexible electronics industry would follow this second course, “and I think we have to have that patience and continued investment.” Dr. Taheri agreed, and said that what was holding the industry back now was “purely money. We’re bootstrapping our way to get there, starting with niche markets. If there were a concerted effort to say this is important, I think you’d be surprised at how fast you could grow and what you could dominate.”