Apple grants Finisar $390M for research & production on laser tech used in iPhone X
Apple on Wednesday announced plans to pay U.S. firm Finisar -- which manufactures the VCSELs (vertical-cavity surface-emitting lasers) used in the iPhone X's TrueDepth camera -- $390 million out of its $1 billion Advanced Manufacturing Fund.
The sum should let Finisar "exponentially increase its R&D spending and high-volume production," Apple said. The company also confirmed that Finisar's acquisition of a 700,000-square foot manufacturing plant in Sherman, Tex. is directly related to Apple.
That facility will be dedicated to VCSELs, and is expected to create over 500 jobs including engineers, technicians, and maintenance staff. It should begin shipping components in the second half of 2018, and along those lines, Apple said that hiring, upgrades, and capital equipment planning are currently in progress.
The company further noted that all of the VCSELs it buys from Finisar will be made in Texas, and that it's working to secure enough renewable energy to cover all U.S. manufacturing efforts.
The Advanced Manufacturing Fund is geared toward support U.S. manufacturing. Apple's first investment took place in May, when it spent $200 million on Corning -- the company that makes the Gorilla Glass used in many Apple devices.
The large sum directed to Finisar likely supports the view that Apple intends to expand its use of TrueDepth cameras, for instance putting it on every 2018 iPhone. The company is expected to launch three new phones next year: 5.8- and 6.5-inch OLED models, and a 6.1-inch LCD design.
The sum should let Finisar "exponentially increase its R&D spending and high-volume production," Apple said. The company also confirmed that Finisar's acquisition of a 700,000-square foot manufacturing plant in Sherman, Tex. is directly related to Apple.
That facility will be dedicated to VCSELs, and is expected to create over 500 jobs including engineers, technicians, and maintenance staff. It should begin shipping components in the second half of 2018, and along those lines, Apple said that hiring, upgrades, and capital equipment planning are currently in progress.
The company further noted that all of the VCSELs it buys from Finisar will be made in Texas, and that it's working to secure enough renewable energy to cover all U.S. manufacturing efforts.
The Advanced Manufacturing Fund is geared toward support U.S. manufacturing. Apple's first investment took place in May, when it spent $200 million on Corning -- the company that makes the Gorilla Glass used in many Apple devices.
The large sum directed to Finisar likely supports the view that Apple intends to expand its use of TrueDepth cameras, for instance putting it on every 2018 iPhone. The company is expected to launch three new phones next year: 5.8- and 6.5-inch OLED models, and a 6.1-inch LCD design.
Comments
I’m pretty sure this is an investment, not a grant.
Never mind, here’s the press release: https://www.apple.com/newsroom/2017/12/apple-awards-finisar-390-million-from-its-advanced-manufacturing-fund/
And Apple’s video on this: https://www.apple.com/newsroom/2017/12/apple-awards-finisar-390-million-from-its-advanced-manufacturing-fund/?videoid=1513150241029
1. In 2017 Apple lends Finisar $390,000,000
2. Finisar uses the money to increase their U.S. manufacturing capacity to build more dot projectors.
3. In 2018 Finsar builds 40 million dot projectors and sells them to Apple for $10 a piece...$400,000,000.
4. In September of 2018 Apple introduces it's new line-up of iPhones which all have the TrueDepth camera.
5. In 2019 Finsar builds 100 million dot projectors and sells them to Apple for $7 a piece...$700,000,000.
6. In 2019 Apple introduces it's new line-up of iPad Pros which all have the TrueDepth camera.
7. In 2020 Finsar builds 200 million dot projectors and sells them to Apple for $5 a piece...$1,000,000,000.
Let's assume it costs Finisar $4 to make a dot-projector...
1. In 2018 Finsar sells 40 million dot projectors with $6 of profit per unit...$240,000,000 profit
2. In 2019 Finsar sells 100 million dot projectors with $3 of profit per unit...$300,000,000 profit
3. In 2020 Finsar sells 200 million dot projectors with $1 of profit per unit...$200,000,000 profit
Apple currently sells about 200,000,000 iPhones and 40,000,000 iPads a year.
The investment in Finisar will ensure that Apple gets enough components to expand their use of TrueDepth in the iPhone and iPad lines.
Apple will make their investment back through lower component costs.
Apple touted their American manufacturing and suppliers long before Trump was president.
March 2012: Apple Touts Itself as Big Job Creator in the U.S.
December of 2013: Apple is Manufacturing its New Mac Pro in Austin
Increased American manufacturing has been a long-term strategic goal for Apple and not because of Trump.
https://www.technologyreview.com/s/601491/the-all-american-iphone/
For your own reference, here's a list Trump stuff made overseas:
https://www.huffingtonpost.com/entry/trump-made-in-america_us_596f9be6e4b01696c6a24918
Also, it's interesting that this investment was being characterized on the radio today as "Apple buys Finisar", which is apparently completely untrue.
Apple partnered with Corning to be the first consumer of their special Ion hardened glass all the way back in 2007 to release the iPhone.
If it makes the president happy to tick off a few checkboxes, sure, Apple will just continue its investments into high tech like it has always done, and make sure they qualify for the president’s checklist - get him off their backs. So now they can categorize a continued investment in Corning of $200M and in exchange Corning can give them VIP pricing on glass.
Apple has always asked its suppliers to make things better than the status quo, which always requires... drumroll... R&D!
If a politician wants to take credit and get bragging rights for Apple doing what it always does, who will stop said politician? Which voters are actually astute enough to credit the people or companies that made good decisions or investments?