Thoughts on the broader situation

I know a lot of people are upset and confused about the current state of the stock price. Markets are often unpredictable. 

Just where is MicroVision?

The goal MicroVision had was to get PicoP to the point where it can start generating money for MicroVision. Then they would support it, and start working on the other awesome IP that MicroVision has. PicoP is there now.

The installations, embedded uses and the revenue from it will not be instant.

It's ready to go, it is being implemented, and the implementation will take time - we're in that process. We're seeing embedded solutions popping up as prototypes - Sony Agent, a silly, but kind of cool R2D2 refrigerator, stand alone projectors, embedded in phones projectors, embedded in a little robot projector, over an interactive sandbox, probably in at least one augmented reality headset. 

R2D2 Refrigerator distracted people.  The big news is that a gigantic company like Haier is using embedded PicoP. Do you really think a company like Haier would use PicoP for a product like that and not be coming up with many other use cases for it? 

When there are many NDAs the news arrives indirectly.

A year ago the chatter on investor  boards was "we have to be embedded in a cell phone -- that's the ultimate." PicoP IS embedded in a cell phone. (which, for some reason looks almost identical to an iPhone5) Mass production, marketing and distribution are going to take a little time.

We had a hiccup last year in the supply chain. That shouldn't have been a surprise to anyone -- we were warned about that during the stockholders meeting -- "everything looks great -- but there can be bumps on the road." We had a bump. It set us back a few months. It didn't change the story.

Going from development, to manufacturing, to field testing, adjusting based on field testing, to mass production and integration all takes time. Look at ANY technology, they all do the same thing. 

MPCL1 and Celluon were the field testing. They now know the product works, and works in the wild. They are clearly ramping the production -- because they've been adding equipment to make more.

The saying "the watched pot never boils" is meaningful here. We have all seen other cool technological things pop up as science fiction, and then a decade later we see it in action and we perceive that it appeared suddenly. That's almost never the case.

We now have a very cool technology that is on the edge of being everywhere.

Regarding the 40-70% growth guidance? My own read on that is that it is an extremely conservative number, probably based only on the currently in place agreements. [I do not know this for certain, it is my opinion. You can form your own]

I sought some counseling on what might be happening with Sharp (two projector engines -- so they're going to use them on more than RoBoHon) and was told that Sharp can't announce anything -- they're in acquisition negotiations with Foxconn.

Stock price aside -- my optimism for the future of MicroVision and the future of its technology continues to grow. The stock price stumbled, but the future is very very bright. (with laser light, from really small laser diodes, creating beautiful imagery on all kinds of surfaces.)

Focused on Stock Price? You're Doing it Wrong.

If, at this point of this company's history you are terribly focused on the stock price, you're doing it wrong.

Sure, we're all here to make money on this company. We did however choose this company to make money on because it has fantastic disruptive technology. The demand for this technology could be staggering.

First: Owning the unknown. Volume & Stockholders
If you own Microvision now, you're owning an unknown company. If you've been doing due-diligence on it for a long time, you're surprised by the reaction to news. You wonder what it's going to take to move the stock price.

As I'm pretty sure that most of the dedicated holders of MVIS are fully invested, it's going to take word getting out about the company. A news release about a larger order from the Fortune 100 OEM (we know to be SONY) is not going to get word out about the company. It can make you feel a lot better about holding what you do though, because you know that they're going to do something. It worked, now they want more.

So, it's the day after news and the price is down what seems like a lot.  Less than 1/10th of 1% of the shares of the stock changed hands. Is the stock price meaningful? Does it changed what you invested in and why? I don't think so. It's not working that way for me. There are good reasons to own shares in this company, and it's not because of what the shares do on a day by day basis. They are the technology, enthusiasm for it, the market potential for it, and the brilliant business model for it.



Second: The technology and future enthusiasm
Check out the link below.

If you think the potential product looks cool you're not alone. (I'm sure this is part of some crowd funding scheme and I'm dubious even a prototype has been made, and I'm dubious it could work as shown.)

To me the interesting thing is the enthusiasm for it. 3.6 + Million views.

Check the comments, and you get two major themes: First "This is awesome" and Second "this is impossible"

If you're paying attention to Microvision, you know that better than this is not only possible but being manufactured now. -- and it's being manufactured by SONY (a company that makes the best video equipment on earth) and at least one more company.

Cicret Bracelet

BIGGER SCREENS -- Mobile Companies MUST use them -- and PicoP is the ultimate bigger screen  They will have to use Microvision



Third: Market Potential

Consumer electronic products can be delivered in STAGGERING quantities.

iPhone Sales (Forbes) Apple iPhone 6 --- 20 million phones in a month - goal of delivering 70-80 million iPhones between the launch in September and the end of the year!

First run of the Apple Watch? They're talking 10 million units.

Xaiomi plans to sell 100 million smartphones next year. (Tech in Asia)

All the devices that all these companies want to sell -- all want BIGGER SCREENS.



Fourth: License business model

The license business model is a great thing.

Increasing production costs Microvision little in additional capital outlays, 

"The operating expenses are in a place where we expect to be able to ramp the business for a while with them. We're using contract manufacturers so as things ramp up, the investments that we have to make are not that large."

Microvision is virtually guaranteed a profit on each unit sold.


Don't own it for what the price does today... own it for what it will do soon.  Review the Conference call, we're very close. If you are holding, you are holding a still unknown company that is about to burst onto the scene with a significantly disruptive and very popular new device that will deliver information and entertainment to millions.

Conference Call Highlights

There was a great deal of good news in the conference call today. 

While there was an absence of specific product announcements, there's plenty there to let us know that it will be soon, and some good hints about what at least one of the products will be.

I have taken the liberty of adjusting the words for flow (If anyone thinks I've inadvertently changed the meaning, please comment and I will adjust it as required.)

Conference call highlights.

SEEKING ALPHA

Annual goal progress:

• First, we announced in September that we completed the display module development phase with our partner. 
• Second, we began supporting them with the display module commercialization efforts in the third quarter under the $1.5 million support agreement that we announced in October. 
• And finally, we received purchase orders in September for MicroVision-specific components totaling approximately $1.9 million. And in fact, we commenced shipments of these components this quarter.    .....The multiyear commercial agreement negotiations are in progress and we are targeting completion later this year.

Multiyear commercial agreement negotiations?! -- this should be good news for stockholders!!

******

OEMS and Retailers interested in Multiple PicoP Products

Now what about additional opportunities? As we stated in our past quarterly calls, our business development efforts are focused on 4 main go-to-market coalitions that involve all the necessary stakeholders to enable a new market. In our case, this coalition includes display engine manufacturers, consumer-electronic OEMs and major retailers.

In Q3, we made significant strides on several go-to market paths in this area involving OEMs and major retailers that are interested in a variety of consumer electronic products that use PicoP display technology.

*******

Orders Shipping

In the third quarter, we began qualification cycle of production processes of MicroVision-specific components and our engineering quality and operations teams have been focused on production readiness activities to establish the baseline production capabilities. These activities are continuing in the fourth quarter as we ship and fulfill in customer orders.

*******

Multiple supply chains

These products will be built by OEMs, who make private label, or brand these products for retailers. Then the engine will come from one of our partners to go inside these products. Right now, we have multiple paths in works and they're at different stages........

The most important part from our side is to be ready with our MicroVision-specific component and enable the engine manufacturers, one of them who you already know and we announced, to be ready to provide their solutions to the product guys so they can basically start populating the retail channels.

Stable cash burn -- even during ramp up.  

This is excellent news! one of the worries of company followers is that the company might have to raise money to increase production. This appears to indicate that this will NOT be necessary.

Q: (Uerkwitz).... should we expect OpEx to stay about where it's at or will we start to see that ramp up a little bit?

A...(Holt) The operating expenses are in a place where we expect to be able to ramp the business for a while with them. We're using contract manufacturers so as things ramp up, the investments that we have to make are not that large.

Contract in place with FG100 customer 

Smaller scale because we are contributing less -- this does NOT mean that it is a small deal and that it will not lead to significant licensing and royalty revenue.

Q (Fitzgerald) ... is there a contract in place for that opportunity?

A (Tokman) .. That's correct. We have agreement in place. It's a smaller scale agreement than what we've done with Fortune Global 100 customer because we are contributing less.

Market Launch with Global 100 this year?

Q: (Fitzgerald) Do you see -- foresee a market launch this year with that customer? (F100 company)

A: these are our partners, we are restricted from what we can say. But our goal, remember, was to be ready with our components to be shipped to them in the fourth quarter and we are on track. And hopefully, more communication will come out. But at this point, we cannot comment on their product introduction time lines.

A number of Products

Q: (Szulist)...are we talking about how many different products, potentially, will have retail debuts in 2015?

A: (Tokman) ...we believe it's going to be a number of products.   ..... We're going to be ready with what we need to provide to everybody to be successful.  ...we collected and commissioned some direct consumer data that we, in fact, we have been using with them to educate them how to more effectively sell these products in these markets.

Rapid Ramp up not a problem

Q: (Szulist) ...Let's say you got a $5 million order, can you reach that? And how long will it take you?

A: (Tokman) ... if somebody comes into us and says, "Look, can you get to $5 million per year rate?" We would give them a date and say, "Look, we can get to this rate by this date to this rate, but yes, we can eventually get to $5 million. No problem."

No Bottlnecks

Q: (Szulist) ...So you really don't have any bottlenecks and you're very scalable in your current business model?

A: (Tokman) ...We don't see it at this point in time. You can never be absolutely sure. But at this point in time, we feel comfortable about setting up baseline to enable the initial launches and also ramping this capacity to enable higher volumes.

Questioner apparently worried about meeting demand

What I read from this is that the questioner has seen the product, anticipates significant demand and is concerned about any impediments to production. I'm worried (and pretty excited about ) crazy demand for this product once it hits the public as well. I've also seen it, and I know. 

(Szulist) "my only view is that I'm concerned that if we are successful with what we've been waiting for throughout these years is that we don't have any kind of bottlenecks that'll just let us flow because I've seen the products so I know." 

Green Lasers Not a problem

(Tokman)  If we had green laser situation in 2010 than we have today, we would all be smiling. Everyone would be smiling right now.... we're feeling pretty good about the green laser situation.

Environment for PicoP excellent

... A long very upbeat discussion about it -- too long to copy, check Seeking Alpha Here

(Tokman) Basically, just all you need to know is that there is a list of automotive and consumer companies we are working on. They're all recognizable names

.... there is more. All the questioners were very upbeat. The tone of the whole call was positive. Progress isn't as fast as any of us would like, but it's steady, and it appears we're getting very close to product announcements.

Thoughts on Apple TV

The following is entirely my opinion.

I've read a lot of other opinions about Apple, rumors about Apple & I've paid close attention to what Microvision is doing for some time. This is a summary of thoughts, with some more current links and rumors.

What would I really like to see coming from Apple & Microvision?

Combine the devices below.

Current Apple TV + PicoP + iPod Classic

What would it include?

"A bigscreen TV and DVR that fits in your pocket."

• A television tuner and access to streaming video feeds 
• Has its own "screen" (infinitely size adjustable to fit the surroundings and lighting conditions.)
• Storage of video for viewing on the go. (160 GB of storage in iPod classic would be more than 20 hours of high-definition video for playback) (your DVR too.)

The best reasons I think this is possible?

1. Most rumors about AppleTV talk about both the need for a screen to be part of the package and the reasons that Apple won't go for a conventional screen.
2. "We've cracked TV" - Steve Jobs
3. iPod Classic is going away. (Do we believe they "can't get parts?" as has been stated by Apple management recently?  "Can't get parts") I do believe that demand for the iPod classic itself is weak, but redirected to video with a larger screen the same storage infrastructure could be used.
4. They could do it. The technology is all in place.
5. They would think about it.
6. It makes sense

Why I think it may happen soon:

1. Access to content was regarded as a major stumbling block. Those blockages are going away at a rapid pace: SA - Apple's new Television Opportunity / Cable Free HBO / 
2. The technology timeline for inclusion of PicoP into other OEM's products is right for something very soon. (as highlighted in this link, manufacturing timelines:  Mfg Timeline Macbook

Why I think it would be a success:

1. It would cost less and offer more functionality than a traditional screen TV
2. iTunes. I was very dubious of the iPod when it appeared. The iPod's success wasn't caused by the brilliance of the device as much as it was because of the content management and delivery system available with iTunes. They can leverage this talent with video as well.
3. People would LOVE this.

Microvision's product
I have seen the most recently demonstrated prototype of the Microvision PicoP in action at the most recent Microvision stockholder meeting. They demonstrated a big screen television that you can slip into your shirt pocket. It is not an exaggeration. It connected easily with a WiFi connection and played content from a cell phone. In a room with medium light it made a bright, clear, excellent picture on the wall that was about 40-50 inch diagonal. "Speckle" was not an issue and wasn't observable unless a deliberate effort was made to find it. The picture is ALWAYS in focus, which is perfect for portable applications. 

Below is the most recent "in the wild" video I know of with PicoP in action. (it's the picture on the ceiling.) The newer version was brighter and better. In person you can't see the scan lines at all.

I suspect Microvision and Apple are working together. For reasons that have been stated here before.  Apple - Sony Timeline 

MEMS pricing and Sony Announcement

I'm stepping out on a limb here, but I think in understanding Microvision's current situation this is an important consideration.

(If anyone thinks I got anything wrong in here, please send me a challenge!) 

Last week, Microvision announced a deal with Microvision for $1.9 Million in components from it's Global 100 customer. (Which we know is Sony, but they are still unable to say this.)

The key word is "components."

Microvision has stated in no uncertain terms that they will have three separate revenue streams:

• Components
• Licensing
• Royalties

It is my analysis, that the reason the components are part of this picture is to insure that Microvision can retain rather tight control over its technology. In which case there isn't a business reason to price the components at a high price -- which would mean that the component sale is a very small part of the revenue in this deal with the global fortune 100 company.

EVERYTHING BELOW is based on a SWAG

I expect that the component order is for the MEMS (or "secret sauce") of Microvision's PicoP. This $1.9 Million in components very likely represents significantly more in ultimate revenue to Microvision.

I do NOT know how much MEMS components would be sold for. As a licensing deal, I would assume that Microvision isn't going to be trying to make as much as possible on each MEMS unit,
but more on the licensing portion & hopefully something on the royalty portion.

It is very difficult to know what MEMS prices may be. There are many many vagaries and unknowns. I have perused a number of meme manufacturer sites for pricing the target is huge, and again, there is a lot of unknown.

I have seen prices for MEMs as low as $0.14 each to up to $5.00. The $5 numbers were on smaller quantities of more complex MEMS. After reviewing a number of those sites a $1 price tag for MEMS seems like both a reasonable and somewhat conservative price. The link just below opens a site that I've used as my "middle." (if you have better information, please share.)

Given that a million units was quoted as the break-even point for Microvision. (Stockholder meeting June 2014)  We can expect that the income per PicoP will be at least $12 when all is said and done.

If the mems are $1. I expect that conservatively, the Global Fortune 100 order was for at least 1.9 million PicoP units. Which should mean approximately $23 million in total revenue to Microvision.

Price of Specialty MEMS   -- $1each

Press Release @ Micro vision

Apple - Sony - Microvision Timeline -- Apple World Wide Developer Conference - WWDC - Foxconn -- UPDATE 9/1/2014

connecting some dots....

FEBRUARY 11, 2014

"Sony could double the number of 'sensors' it supplies to apple...."
Sensors from CNET


FEBRUARY 20, 2014

"Sony Develops Pico Projector Module with High-Definition Resolution and Focus-free Image Projection" - "incorporates the PicoP technology developed by MicroVision, Inc."

Article collection from this blog
Sony Press Release

MARCH 3, 2014

2014 Green laser demand according to Sony: 10,000,000
Reference Here

April, 2014

Apple Advertisement...




Concept video released...


MAY, 2014

May 1

From Mashtable among others
"Although Apple CEO Tim Cook has remained mum on whether the company will release a wearable device of any kind, his statements in recent months have consistently been peppered with comments about an exciting "new category" of product the company plans to release later this year."

May 6

MVIS Conference call
"PicoP display technology as many of you know can enable an end user experience with features such as high definition, always in focus images, display it on a gigantic screen with laser brightness that are not attainable from other PicoP projectors..."  -- Alexander Tokman, May 6, 2014

This was the first time we'd heard "gigantic screen" as a descriptor of the experience with PicoP.  Is this a coincidence or deliberate?

May 21

New Hardware to be announced at Apple World Wide Developer Conference

From NewYork Post

WWDC Schedule

TUESDAY MAY 27
Foxconn Technology Group Buys Stake in Asia Pacific Telecom
(Reuters) - Apple Inc supplier Foxconn Technology Group will buy a stake in Taiwanese mobile telecoms operator Asia Pacific Telecom for T$11.6 billion ($390 million) in a deal that would expand its presence in Taiwan's fledgling 4G telecoms market.

Foxconn could stand to reap significant rewards from this deal, if the amount of bandwidth consumed by mobile customers in Taiwan increases significantly. The ability to view large amounts of media easily while mobile would 

Apple TV business to "evolve"

Commentary(questions):

• A PicoP engine could easily be referred to as a "sensor" if you were concealing actual intent.
• If your first application for your new technology were going to be to put it in your own product, why would you announce that you were making a module?
• Were the Sony announcements in February coincidental?
• We know that making actual video game controllers for iPhones is NOT a fantasy. So, the iPhone video game projector video might not be entirely fantasy. Apple Teams up with Logitec
• The video featuring the "gigantic" song is interesting. Featuring gigantic screen projections working in concert with Apple products. Apple doesn't waste their money, so they're making us think about this for a reason.
• For me, "gigantic" was a key word I was listening for during the conference call. Heard it. Never heard it before in context with a PicoP before. Always heard "big screen," "large screen," "full screen" but never "gigantic screen." Accident? Maybe.
• Apple increases buzz about "totally new class of hardware" to be released. As several kinds of smart watches have been released, can it be a smart watch?
• Apples WWDC schedule is full of "I can't tell you yet." Schedule will be filled in on June 2.
• Foxconn buys a stake in Asia Pacific Telecom. They can't buy Apple stock, they know to much, same with Microvision or Sony. But -if they're confident that consumption of mobile video is going to soar, this is something to buy, and not "insider trading." It's a significant bite.
• This year, Microvision's Annual Stockholder Meeting is a week or two earlier than normal, on a Tuesday, not a Thursday -- and just a day after the Apple Developer Conference.

We will see next week.

Conference call Transcript (partial)

I transcribed this myself. I did not get any part of the transcription from any source other than listening to the conference call. I made efforts to be accurate while still removing extra words that made it difficult to understand.

A couple of questions (and the financial portion of the call) were omitted. (One will be included at a later date.)

If I got something wrong, I'm sorry.

If I got something wrong and you were speaking, please send me a correction and I will update the text as soon as I am able (and include a notation to that effect if you wish.)

After listening, copying and re-listening to this call, I find that while it wasn't an exciting call with new and eagerly anticipated news, it is very positive, shows Microvision to be on track and doing the hard work that it takes to bring a new technology to market. Those of us who appreciate what it takes and have the patience to hold shares in this company until the exciting news happens will be well rewarded.

---

THE CALL

Tokman: In the second quarter, we continued to make tangible progress on our three primary operating goals for the year.

Outside of major announcements with the Fortune Global 500 company which we communicated in June, Q2 was about completing less visible but essential blocking and tackling milestones associated with completing design and development phases and beginning the transition into the production phase.

Let’s start with the first goal, which entails three elements:

·         First completing the display module development phase with the Fortune Global 100 customer.

·         Second, supporting them with their productization and commercialization efforts.

·         And finally, supplying them with key Microvision components.

Now many of you know, our customer announced in January that it aims to bring a high-performance high definition image quality display module to market to use in picoprojectors and other devices with projection functionality.

We have been closely supporting the development of this module which incorporates Microvision’s patented PicoP laser scan beam display technology. We are currently focusing on production planning and support phase with our partner, now that the design and development phases are nearly complete. We also made progress on the negotiations related to the commercial agreements which we are targeting to complete later this year. (probably will be announced.)

Now, moving on to the second operating goal which encompasses building a pipeline of consumer and automotive opportunities for Microvision’s go to market partners. In June we announced a collaboration with a second consumer electronic company, on the Fortune Global 500 list, to develop a display engine for an innovative smartphone product to be offered by this company. The new partner has communicated to us that it targets market introduction of the new product in the second half of 2015.

Shifting to the automotive segment, we previously announced we are working with a global tier one supplier and a major vehicle OEM. Microvision delivered multiple prototype HUD systems to the Tier1 supplier in the second quarter. The prototype head up display system for the vehicle OEM is slated for delivery this quarter. Third quarter. These programs are in the evaluation and test phases as we mentioned earlier which are critical steps to having a new technology adopted and embedded in automotive applications.

Next topic is UPS, we are currently on track to deliver custom PicoP display modules in the third quarter to UPS which is another Fortune Global 500 customer. The modules are part of a new package guidance  application targeted at increasing processing efficiency in real time package sorting and routing. UPS has informed us that it plans to deploy the system in a facility in the United States.

Our business development efforts are focused on forming go to market coalitions that involve all the key stake holders needed to enable a new market. In our case, the coalition involves display engine manufacturers, consumer electronics OEMS, and major retailers. In Q2 we continue to make important progress on several go to market paths involving some of these OEMs and major retailers that are interested in a variety of consumer electronic products utilizing PicoP display technology.

The final goal for the year is to ramp supply chain for high volume production of Microvision components in the second half of 2014. Recall that in 2013 we began development of supply sources for MEMs and other key components with some of the world’s leaders in their respective areas. In the second quarter of this year we began qualification cycles of production processes for Microvision specific components and we expect volume production capacity for our components to be in place in the fourth quarter of this year.

Stephen Holt’s financial presentation. ---

Questions and answers:

Andrew Uerkwitz Oppenheimer:

Q: Thanks, congratulations on the progress you’ve been making. Alex, question for you. As you enter the production phase and several of these potential customers are trying out the products, what are some of the milestones that you need to accomplish and what are some of the potential hurdles you could face to get there?

Tokman: There are several different milestones we need to complete on our own, and then with our partners. If you look at our own deliverables we need to complete qualification phases of Microvision specific components with our specific suppliers and have it ready for mass production in the 4^th quarter. We feel comfortable that we can achieve this.

The other milestones include supporting our fortune global 100 and several other customers in development of their engines because we still are part of the cycle and we’re enlisted to support them with both technical and market support, in preparation for their own commercialization efforts.

Finally, product OEMS who are developing products based on our technology utilizing the engines of our partners also need marketing and technical support to help them to deliver products to market.

So we are working three fronts right now: our own deliverables, and then supporting our partners, both on the engine and the product side, to help them to introduce the best possible products as soon as they are ready.

Andrew: Opex Question….

Q: Mike Latimore, Northland Capital Management: You mention that the design and development is nearly complete with your fortune 100, when do you think that will be complete.

Tokman: We’ve basically completed 95% of the all the deliverables. The 5% that remains we submitted the final deliverables and right now it’s going through acceptance and evaluation phases --so for all practical purposes we expect it to be completed very shortly, and it’s not hindering any other progress on the production support nor on commercial agreement negotiations.

Mike Latimore: Does that have to be complete before the commercial agreement is complete?

Tokman: We expect yes and we expect that this will be done prior to the commercial agreement being completed, yes.

Mike Latimore: On the new smartphone opportunity if they want products for the second half of next year, would that suggest you would see revenue during the first half of next year related to that.

Tokman: You’re right Mike, typically there’s a lead time on a component before they convert it into engines before the product, so if they target the second half of 2015, you would need -back probably three months, this is when we would start receiving something from them from the engine manufacturers who will be receiving orders from the product OEMS, that’s correct.

Mike Latimore: What’s in the 1.1 million of backlog?

Holt: UPS is a large part of that, and some additional development work for the Fortune Global 100. Those are the two main pieces.

Mike Latimore: Do you think you’ll see revenue from the Fortune Global 100 first or the smartphone manufacturer first?

Tokman: Most likely it will be from the Fortune Global 100.

Dennis: I wanted to know the commercial agreement with the first customer, the Fortune Global 100, can you shed any light on how sizeable that deal will be and how close that gets us to the breakeven point, and not needing to raise more funds.

Tokman: I’m going to try to stay within the framework of not disclosing something we’re not allowed to at this time and still give you hopefully enough information. The agreements we’re pursuing right now with the Fortune Global 100 include several. First, there is the supply agreement, second  there is the product support agreement which is independent, third the licensing agreement for the royalties of  incorporating our technology inside their offerings. There are several agreements ongoing, each with different terms and conditions and we have to cross each one to complete this. In terms of what is the size. The size is going to be determined by the size of the demand that this customer will generate for their own products, and for the products from other  customers they will pursue to incorporate their engines. So it’s their target plans, and we’re not at liberty to discuss what their target volumes are.  But we’re excited about this opportunity, this is the largest opportunity has had in the history of Microvision. So we want to see It come to fruition, and we’re doing our part to ensure that it will happen.

Dennis – Cash raising question.. response by Holt

David Morgan: As far as the UPS system is concerned, the deployment that you discussed, is that going to be in this calendar year?

Tokman: We’re delivering our modules this quarter and they will deploy it in the US. We cannot specify the timing, because it’s something they are sensitive about, but -you do your own math.

David: Originally you said this was pilot development, is it still in the pilot stage? Or will this be beyond that at this point?

Tokman: It’s a real implementation in one of their flagship sites. The goal – remember what the goal is, the goal for UPS is to quantify the potential performance improvements of their processes in terms of increase of throughput and reduction of error rate. So they need to quantify this information and they selected the site to implement this.

Unanswerable question – can’t comment..

David: You also discussed a large volume capacity by the end of the year, now is there two components, are some of your partners going to supply all of the pieces on their own, or will you be a supplier in every case of at least part of the module?

Tokman: We will be a supplier in most of the cases. It’s case to case specific. In some cases we will provide more, and others we will provide less. We should be a part of every endeavor, whether it’s engine manufacture, and We expect to be in every module.

David: You say large volumes by the end of the year,  any kind of  an idea what large means? Is that a million units, or more than a million units?

Tokman: It’s a sensitive question because it would guide the demand from some of our partners who ask us not to discuss this publicly. Our goal, as I mentioned -as Steve mentioned, our goal is to have volume capacity ready in the fourth quarter to enable whatever the needs are. We feel that what we have put in place  will satisfy the initial demand, and we have a plan to ramp that as necessary as we see the demand increase subject to lead times that everyone knows they need to provide to us to allow for higher demand.

David: And the commercial agreement that’s in progress, when that’s negotiated and final is that something you’re going to be able to announce?

Tokman: We believe so.

Closing remarks:

Let me start closing remarks by saying that a lot of work has been done by Microvision and our partners and we’re excited at the prospects in front of us. As we’re moving into commercialization stages for our own components, in the second half of this year. We’re concurrently providing both technical and market support to our go to market partners to facilitate their efforts in launching their solutions be it engines or products. PicoP display technology as you know can enable end user experiences that are not attainable by other picoprojection solutions; and that are well-suited for the mobile video consumption that consumers are now making part of their daily routine. We believe the rapidly expanding consumer behavior of watching video on mobile devices creates a perfect opportunity for picoprojection. According to Adobe, for example, online video views on a mobile device has experienced a 57% increase year over year. With smart phones leading the charge, followed by tablets. No matter how great your smartphone or tablet is, the screen is still too small to share information with others. And you have to admit it, watching a 1 and a half hour movie from your smart phone on a 100 inch screen is much more pleasurable than watching it on a 5 inch screen. That’s why having a device or a feature that works in tandem with your primary device and offers an immersive experience could be very valuable, we believe. Hence, if anyone wants to have an immersive experience from their mobile device of choice – experience that is characterized by enormous high-definition image that is always in focus and obtained from a low-power very slim and light device, then Microvision’s PicoP technology is for you. We are very excited about the business partnerships that we have developed and built and are developing and building with the leading industry players who are bullish on this emerging market. Who enlisted our support to bring their solutions to market. At this point we’ll conclude this call.

Institutional Investing and What are the shorts thinking?

Active institutional position are getting much larger.

But there are still a lot of short positions in the stock.

Active Positions

	HOLDERS	SHARES
Increased Positions	20	1,462,762
Decreased Positions	6	117,202
Held Positions	18	2,889,542
Total Institutional Shares	44	4,469,506

Read more: http://www.nasdaq.com/symbol/mvis/institutional-holdings#ixzz38gglPVdm

New and Sold Out Positions

	HOLDERS	SHARES
New Positions	9	369,466
Sold Out Positions	1	50,500

Read more: http://www.nasdaq.com/symbol/mvis/institutional-holdings#ixzz38ggoPhub


What are the shorts thinking?

There are only a few options for them right now that make any sense to me. I'd like to know what other people think is possible. 

1) They might think the MVIS tech will be a fail and will be shown to be a complete failure soon. (Even a short-term pop in the stock could force them to cover.) 

We know this isn't the case. We've seen the product in action, and for durability, we know that it has successfully performed while bouncing around in Japanese cars - in extreme heat and cold and humidity. It works, It won’t fail. 

2) They think that a product release will be disappointing. That instead of a huge release of a product, it will dribble out of Sony as an add-on to a video camera and little else. 

I must admit this is a concern, but not a significant one. It is possible that management at Sony will dribble the technology out instead of doing a massive release. I doubt it though. Even a fearful management team would not want to dilute their thunder. 

3) They don’t believe in the technology at all. Maybe they’ve seen the Texas Instruments DLP projector for which they claim 80 lumens, and thought that a Microvision PicoP projector rated at 35 lumens has to lose in comparison. 

I actually think this is high likelihood in the short camp. Gigantic Mistake. I have seen the DLP projector on the current Sony video projector — there are several, the one I saw in action is horrible. The throw ratio is poor, the picture is dim, and the focus is touchy. The ShowWx absolutely blows it away it is superior in every respect. And the current demo model shown at the ASM is very superior to the ShowWx. 

If they believe the comparisons — I could understand shorting the stock.



I would be absolutely astonished if ANYONE who has actually seen the technology in action could possibly be short the stock. 

4) They are trying to manipulate the stock lower, to make it cheaper. I’d say this is possible, but probably by trying to sucker other people into shorting the stock.

Market is Gigantic - and Growing

1.25 Billion Smartphones to ship in 2014

2 Billion Smartphones to ship in 2018

The market is Gigantic. Even if Microvision manages to sell to only a small portion of it, the income potential for Microvision is staggering. I'll have to adjust estimates here upward.

London, United Kingdom - 09 Jul 2014    Link

ABI Research expects 1.25 billion smartphones to ship in 2014 and forecasts smartphone shipments to pass the 2 billion mark in 2018. The compound annual growth rate (CAGR) over the forecast period from 2014 to 2019 is 12%.

“While smartphone growth is beginning to fall, plenty of growth remains, with smartphone penetration of mobile subscribers under 30% worldwide,” commented Nick Spencer, senior practice director, ABI Research. “Most advanced and affluent markets already have 60%+ penetration, so the growth is driven by developing markets and the reduction in smartphone ASPs.”

Smartphones will consolidate their lead as the largest computing category, more than doubling that of its nearest rival in 2017. Growth is being driven by Chinese and Indian smartphone manufacturers, creating low-cost Android or AOSP devices for markets in Africa, Asia, the Middle East and Latin America.

These findings are part of ABI Research’s Smartphones and Handsets Market Research, which includes Research Analyses, Market Data, Insights, and Competitive Assessments.

ABI Research provides in-depth analysis and quantitative forecasting of trends in global connectivity and other emerging technologies. From offices in North America, Europe and Asia, ABI Research’s worldwide team of experts advises thousands of decision makers through 70+ research and advisory services. Est. 1990. For more information visit www.abiresearch.com, or call +1.516.624.2500.