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Monday, March 22, 2010

What the LED Industry Can Learn From Semiconductors

I had the great opportunity to talk about SEMI and the LED industry at last week’s SEMICON China (see picture, standing room only). LEDs are the fastest growing semiconductor technology in the world right now (faster than PV). The market is projected to triple to $20 billion by 2013, and that’s just when the mega markets in lighting begin to open up. Currently, lighting consumes about 20% of the world’s electricity and solid state lighting (SSL) can reduce that by 50%. In other words, SSL is the most important energy conservation technology likely to make a big impact on our carbon footprint over the next decade.

The title of my talk was “Moore’s Law and Haitz’s Law and their Importance to Our Energy Future.” Everybody in the chip industry knows Moore’s Law, but Haitz Law is new to many semiconductor folks. Named after Dr. Roland Haitz, a now-retired scientist at Agilent Technologies, Haitz’s Law states that every decade, the cost per lumen falls by a factor of 10 and the amount of light generated per LED package increases by a factor of 20, for a given wavelength (color) of light.

Like Moore’s Law, Haitz's Law is an observation and prediction about the steady improvement over the years for LEDs. It is not based on physical science or natural law that can be observed in nature and proven by experiment, it a mere expectation of a learning curve or process optimization that will take place over time. It is my opinion that for Haitz Law to continue to be realized--like Moore’s Law in semiconductors--effective industry collaboration will be required.

I made my case by comparing semiconductor manufacturing technology of 1975 with LED manufacturing today. Both industries shared the following characteristics:

• Manufacturing was accomplished by highly proprietary processes using customized or highly modified equipment.
• Different wafer sizes and geometries were widespread (no standards)
• Throughput was only 50 wafers per hour
• Yields were low
• And Equipment Productivity was a challenge

In 1975, Moore’s Law had been realized for twenty years by individual companies, each working independently, without the benefit of technology roadmaps and industry standards. But by 1991, technology roadmaps and SEMI International Standards were essential to sustaining Moore’s Law.

The LED industry has been achieving the pace predicted by Haitz Law to the present time without any industry collaboration, such as technology roadmaps and standards. This is about to change. According to many experts, efficiency gains in lumens per watt will be slowing and limited to approximately 2x improvement before reaching their limit. Cost reduction goals according to the Department of Energy to reach large SSL markets, however, will require a 20X improvement. The performance of white LED devices depends on both the correlated color temperature (CCT) of the device and, to a lesser extent, on the color rendering index (CRI). We are beginning to approach what are perceived to be the practical limits of these parameters. Further cost reductions must come from manufacturing improvements in yield, productivity, throughput and other cost reductions.

The conclusion of my talk was that from what we know from the semiconductors and sustaining Moore’s Law, to continue to achieve cost reductions predicted by Haitz Law, highly developed forms of industry collaboration, such as technology roadmaps, industry forums and industry standards will be required.

Currently, no such industry collaboration activities are underway in the industry. Manufacturers of HB-LEDs are often vertically integrated and extremely protective of their intellectual property. Participating in standards activities, roadmaps and organized supplier dialogs are seen as a threat to the highly proprietary processes that enabled today’s market positions. In addition, everybody in the industry is dealing with enormous demand—including reported shortages in MOCVD tools—to meet today’s demand driven by LCD displays. No one has time.

The PV industry was similarly skeptical of organized industry collaboration 2 years ago, yet today discussions on industry roadmaps are beginning to take shape and standards activities are well underway (there are now 22 SEMI International Standards committees, working groups and task forces established with over 400 participants).

We are only at the beginning of a massive SSL market explosion expected to burst in around 4-5 years. To reach the cost reduction targets for commercial and residential lighting markets some of these issues will have to be addressed. And the social benefits and goals are hugely important and go beyond the interests of any one company. Large scale penetration of SSL in the US alone can replace up to 200 coal fired power plants, spewing tons of CO2 emissions.

To begin the process of industry collaboration and break down the walls of secrecy and suspicion, SEMI has organized a HB-LED Steering Committee to search for ways of achieving meaningful, effective collaboration. For more information on the Committee and what SEMI is doing in HB-LEDs, email me.

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