Apple grants Finisar $390M for research & production on laser tech used in iPhone X

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in iPhone
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.
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Comments

  • Reply 1 of 22
    Grants?

    I’m pretty sure this is an investment, not a grant. 
    SpamSandwichwatto_cobra
  • Reply 2 of 22
    I don't think Apple would just give the money away. This money is a loan and Finisar would have to pay back, I assume. The word "grant" feels like a gift that doesn't need to be returned. So, the title is a bit confusing for me :p
    watto_cobra
  • Reply 3 of 22
    Looks like Apple is investing heavily in the new tech for Face ID. It'll only get better from here.
    StrangeDaysstarwarswatto_cobra
  • Reply 4 of 22
    cincymac said:
    I don't think Apple would just give the money away. This money is a loan and Finisar would have to pay back, I assume. The word "grant" feels like a gift that doesn't need to be returned. So, the title is a bit confusing for me :p
    I thought this was part of that $1B investment fund Apple announced?
  • Reply 5 of 22
    Looks like Apple is investing heavily in the new tech for Face ID. It'll only get better from here.
    Bingo. I scratch my head at people who make the questionable assumption that Face ID is static and done and will never been changed or improved. As if that has ever happened in tech.
    watto_cobra
  • Reply 6 of 22
    tzeshantzeshan Posts: 1,931member
    Does this money make Apple exclusive ? Could Finisar supply Android copycats? 
    watto_cobra
  • Reply 7 of 22
    Rayz2016Rayz2016 Posts: 4,561member
    tzeshan said:
    Does this money make Apple exclusive ? Could Finisar supply Android copycats? 
    Not from this facility they won’t. 
    watto_cobra
  • Reply 9 of 22
    Potentially, future AR glasses would include some variant on FaceID that would further increase demand for VCSELs.
    watto_cobra
  • Reply 10 of 22
    Looks like Apple is investing heavily in the new tech for Face ID. It'll only get better from here.
    This is definitely happening as a direct result of Pres. Trump’s push for American manufacturing and making it politically uncomfortable for overseas overdependence.
  • Reply 11 of 22
    tzeshantzeshan Posts: 1,931member
    Rayz2016 said:
    tzeshan said:
    Does this money make Apple exclusive ? Could Finisar supply Android copycats? 
    Not from this facility they won’t. 
    So Apple is spending $390 million so this facility can produce more chips to supply Android copycats.  This is a very smart move by Tim. 
  • Reply 12 of 22
    How this probably works...

    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.

    edited December 2017 watto_cobra
  • Reply 13 of 22
    Looks like Apple is investing heavily in the new tech for Face ID. It'll only get better from here.
    This is definitely happening as a direct result of Pres. Trump’s push for American manufacturing and making it politically uncomfortable for overseas overdependence.
    No, no and no.

    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/
    watto_cobra
  • Reply 14 of 22
    tzeshantzeshan Posts: 1,931member
    How this probably works...

    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.
    4. In 2019 Apple introduces it's new line-up of iPad Pros which all have the TrueDepth camera.
    5. 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
    2. 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.

    Finsar quarterly revenue is already over $350 million. This expanded production will enable Finsar to sell to Android copycats more easily.
  • Reply 15 of 22
    Looks like Apple is investing heavily in the new tech for Face ID. It'll only get better from here.
    This is definitely happening as a direct result of Pres. Trump’s push for American manufacturing and making it politically uncomfortable for overseas overdependence.
    Forgive me if I don't take your word for it. Prove it, please. 

    For your own reference, here's a list Trump stuff made overseas:

    https://www.huffingtonpost.com/entry/trump-made-in-america_us_596f9be6e4b01696c6a24918
    edited December 2017
  • Reply 16 of 22
    tzeshan said:
    How this probably works...

    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.
    4. In 2019 Apple introduces it's new line-up of iPad Pros which all have the TrueDepth camera.
    5. 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
    2. 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.

    Finsar quarterly revenue is already over $350 million. This expanded production will enable Finsar to sell to Android copycats more easily.
    Just like how Apple's A-series CPUs manufactured by Samsung are showing up in Android phones?
    SpamSandwichwatto_cobramuthuk_vanalingam
  • Reply 17 of 22
    Looks like Apple is investing heavily in the new tech for Face ID. It'll only get better from here.
    This is definitely happening as a direct result of Pres. Trump’s push for American manufacturing and making it politically uncomfortable for overseas overdependence.
    No, no and no.

    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/
    Yes, Trump has shifted the focus back to American manufacturing and employment, something both Republicans and Democrats have ignored for years and that political pressure has forced companies to consider moving some or all of their operations back to the US. Tax reform will make that even more attractive.

    Also, it's interesting that this investment was being characterized on the radio today as "Apple buys Finisar", which is apparently completely untrue.
    edited December 2017
  • Reply 18 of 22
    This is definitely happening as a direct result of Pres. Trump’s push for American manufacturing and making it politically uncomfortable for overseas overdependence.
    Apple sources components and invests in R&D worldwide (i.e. $500M investment into flash controllers from Anobit in Israel, etc.). 

    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? 
    edited December 2017 muthuk_vanalingam
  • Reply 19 of 22
    Apple should keep secret its TrueDepth technologies in Face ID.
  • Reply 20 of 22
    Grants?

    I’m pretty sure this is an investment, not a grant. 
    9to5Mac is claiming Finisar clarified this wasn’t an investment from Apple but basically an advance. I didn’t see a statement in their story so not sure where they got it from.
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