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Will an E Ink bottleneck stymie e-bookdom—or maybe help the iPhone and Nemoptic?
December 5, 2007 | 5:41 pm
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By David Rothman
Could an E Ink production bottleneck stymie e-bookdom? Or maybe benefit alternatives such as the LCD-based iPhone? E Ink gadgets, whether the latest crop or the older Librie, shown in the photo, have cost hundreds of dollars. And there’s a story behind that.
Read an informal TeleBlog comment from Michael Harris, associate professor of information systems at Indiana University-Southeast. In part—I’d encourage you to view the whole comment—he says:
“I am a big e-book fan, and I own a Bookeen reader from Cybook. However, before we get too excited about Kindle, Cybook or the iLiad, we should understand that these are all just experiments and that mass adoption is not only unlikely, but impossible at this stage.
“The problem is the limited capacity for E Ink display screens that all of these systems use. Currently, the only manufacturer of these screens is a company out of Taiwan called PVI. Do a search on the Net and you will find that as of this time last year they were quoted as having capacity for 60,000 per month with capacity expansion planned for 2007/08, I couldn’t find any hard figures on their current capacity, but as far as I know, PVI had a press release at some time where the company quoted a planned capacity from their plant of 1 million screens. Currently, the news from PVI is all about making flexible E Ink screens, not about capacity expansion.
“Anyway, the point is that this 1 million capacity is spread across all the products that use eInk, including Kindle, Cybook, iLiad, Jinke, and I’m sure others that I’ve forgotten about. 1 million worldwide is only a drop in the bucket. As a comparison, there are about 80 million smartphone’s sold per year. As a comparison, I would argue that smartphones are huge among business people, but they are a bit expensive (phone price plus data plan of at least $30 per month) for the average consumer. The bottom line is that the capacity of E Ink screens is one to two orders of magnitude below where it would have to be for mass market adoption.
“Because of this it is no wonder that current prices are so high. They can’t supply a mass market, so there is no reason to leave money on the table with mass market pricing. The Kindle is sold out; the Cybook is sold out; and this shouldn’t be a surprise…”
So, gang, what do you think? Might a lot of the enthusiasm drummed up for the Kindle actually end up benefiting manufacturers using technologies other than E Ink—and also providers of similar tech such as Nemoptic, which can piggyback on LCD factories? Or will cheap flexible e-paper quickly replace the current E Ink? Meanwhile thanks to Michael for writing such a provocative and thoughtful comment. Within his schedule he’s already agreed to be a TeleBlog contributor (remember, he was only commenting informally), and I’m tickled.
Detail: I quoted extensively for the convenience of our RSS readers. The TeleBlog gives full feeds.
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Comments:
Those are great points. If e-ink technologies get to a point where they can be placed anywhere on any device, then it is not an e-reader device that will revolutionize, but an already used to device that can be adapted. This will be very cool to watch.
First he says that the main manufacturer has expansion plans and then he says no one will spend millions expanding production if the tech is going to change.
What made absolutely no sense is the claim that this so (no interest in spending millions) because of the a) likelihood of change in product line and b) limited market. But there was a time when that same sort of problems applied to pretty much every tech. After all, that 80 million a year smartphone market didn’t simply rise up over night. Cell phones used to be extremely expensive, bulky, were changing constantly from year to year…who would ever invest in that market???
The bottom line is that if these folks are really selling every e-ink display they can produce, the money to build/upgrade facilities will follow.
But, Brian, keep in mind Michael’s qualifier–”at this stage.” He’s not saying E Ink is dead forever. BUT it could lose some momentum if, say, production lags and Nemoptic can fill the void. Just my take. Happy holidays. David
Brian,
You do make a good point that the strong sales should encourage increased production. Furthermore, I don’t want to pretend I really know what PVI’s inside plans are — I’m just speculating based on their public announcements.
However, the history with PVI doesn’t indicate they can instantly turn up the volume on production. Their past history has shown it takes them a year or two to ramp up a million or so units of capacity. To get to a higher number, say 50 million would probably take them at least as long.
Furthermore, proof that they can sell out a million units is completely different than selling out 50 to 100 million units. I agree with you that their current numbers should easily justify a capacity expansion. The problem is how big the expansion will be. Even a two-fold increase still leaves them far below mass market levels.
I suspect that if they had secured funding for a 10x or even 100x increase in capacity they would trumpet it from the rooftops — similar to their original announcements. We could then start timing product availability from that press release.
As I said originally, I own an e-Ink based unit (the Cybook) and I am a fan of the product. My post is not meant to bash e-books or e-Ink. My goal is to point out that the current products may still be at the experimental stage in terms of quantity available, and that the window is still open for the underlying technology to further evolve, and for potential competitors to emerge. Furthermore, given the limited supply I wouldn’t be surprised to see prices remain at early adopter levels for a bit longer.
Michael Harris
PVI just bought an LCD producer.
http://www.digitimes.com/displays/a20071121PD217.html
I guess it’ll take a while to convert the factories to E-Ink screens production, but I expect we should see some increase in the volume by the end of 2008.
E Ink is a proprietary technology, with all the disadvantages that entails. But as David points out, it’s not the only e-paper kid on the block. It never ceases to amaze (and indeed grieve) me how my fellow leftists seem to think that the working of markets is a myth instead of a fact. If the demand for e-paper raises sharply, there will be friction, but in the end production of some kind of e-paper will go up.
I read the original comment and found it fascinating and it provoked my thinking. Thanks for that.
>>>It never ceases to amaze (and indeed grieve) me how my fellow leftists seem to think that the working of markets is a myth instead of a fact.
Oh! This is teleread, so I will only say, boy, would I like to comment on *that* assertion!
>>>If the demand for e-paper raises sharply, there will be friction, but in the end production of some kind of e-paper will go up.
Well that was exactly a point made in the original comment: that the current eInk tech could easily be made obsolete within a year or two by a new screen tech that none of us have heard of that is probably in some lab right now nearing production-run ability. If color eInk is perfected, would there still be a market for monochrome? Would it even be offered for sale at all? (Good luck replacing that broken/worn Kindle/ Reader/ Cybook, etc, screen!)
At this link:
http://www.forbes.com/technology/2007/12/03/ebooks-kindle-digital-tech-personaltech-cx_ag_1203ebooks_slide.html
There is a mention of a screen technology Qualcomm is developing that could trump eInk in many ways.
Xerox was already working on e-paper in the late 1990s, and was known to be working on e-paper by that time. There are lots of technologies being developed, but I doubt this is happening with great secrecy. At the latest manufacturers must out themselves when they start applying for patents.
Yes, if color e-ink is developed there will still be a market for B&W, if it’s significantly cheaper at the same size/resolution, or higher resolution at the same size/cost. For most reading, I’d take monochrome at 1200×900 over color at 800×600, say.
But that’s just it: I doubt there will *be* a market for monochrome once color is out there. Show me a monochrome PDA you can buy today. A monochrome notebook (hey, David, leave the OLPC out of this for now). Color trumps. Screen makers will produce what sells.
And a color screen might in fact allow for true white backgrounds. That could speed up acceptance of ebooks.