Liquidmetal Pioneers the Materials Frontier
(Cont'd --- Reprinted courtesy of Forbes Nanotech Report -- www.forbesnanotech.com)
Real Products on the Market
Liquidmetal alloys are melted and molded into precision net-shaped parts like plastics. Low-cost thin plastic is the standard in most of today's mobile phones. Handset vendors would love to incorporate stronger metals into their phones, but they are costly and heavy. Liquidmetal offers superior benefits to other metals - 5 times stronger than titanium with a strength-to-weight ratio more than double that of steel - and yet also lightweight and not too expensive.
Liquidmetal is gaining traction in the $60 billion worldwide mobile handset market because its casing is light and sturdy enough to hold the large color displays flying off the shelves in Asia. This quarter, it supplied the casings for Samsung's new SCH-X199 phone as part of a $400 million order from China Unicorn [CHU]. Samsung, one of the world's fastest growing major handset manufacturers, has indicated that in 12 months, 50% of its phones will have color displays. This is a huge potential windfall for the company.
Depending upon the sales, the total order for the SCH-X199 could range from 1-12 million units. Liquidmetal expects more than 60% of 2003 revenues will come from the mobile handset market, with the
Samsung revenues recognized in Q4 '02.
The company has other markets in mind, particularly the defense industry. It has already gained momentum in this market, with $5.25 million from the 2003 Defense Appropriations bill to explore military and defense applications of its alloys and a $2 million DARPA grant to make stronger armor piercing ammunitions to penetrate tanks. A major hedge fund manager I talked to that owns LQMT thinks this
business alone could be worth $1 billion by 2005.
There are many other Liquidmetal products in development today including TAG Heuer watch cases, surgical instrument components for a Johnson & Johnson [JNJ] subsidiary and golf clubs. Ping and Cleveland Golf will introduce clubs made with Liquidmetal in the first half of 2003 that can outdrive titanium counterparts.
Lessons for Nanomaterials Companies
Liquidmetal made it to the public market without funding from venture backers, but it took years of development to create a commercial product. One of the hurdles for Liquidmetal and other new material producers is the substantial increase in cost to customers. With nanomaterials, the challenge is to make added performance economically viable. Liquidmetal was only able to break through commercially
after development partners saw that its high performance could be achieved at a reasonable cost. The company continues to try to drive down the cost of its materials through manufacturing efficiency.
As Liquidmetal creates more success, the amorphous metals arena is bound to get crowded. Several industrial leaders are already working on developing their own amorphous metals. Honeywell [HON] began its amorphous metal R&D efforts in 1970 and its Metglas Solutions division now produces thin amorphous metals used in electrical distribution transformers, high frequency magnetic components for power electronics, and material for anti-theft tags. GE [GE] is also developing iron-based amorphous materials for transformer cores and aircraft chassis. Boeing [BA] is funding research of aluminum-based amorphous alloys to reduce the weight of its planes. Alcoa [AA) is also committing R&D dollars to create a low-cost sheet making process for iron and aluminum-based amorphous alloys. Liquidmetal's main focus is
to maintain a dominant position as the industry grows. "There will be competition, but we want to make sure there are no competing standards," says Kang. "We want one standard, and we want to be it."
Liquidmetal has claimed all pieces of IP relating to amorphous metals and also partnered with more
than 25 universities. "We can't stop all discoveries, but we want to make sure that without us, their dis-
coveries are worthless." Says Joe Poon, a UVA physics professor working with Liquidmetal on developing amorphous steel alloys. "There are two important aspects to amorphous metals. The discovery and the
processing - Liquidmetal has cornered both.
1 | 2 | 3
go to top
| 
