Memorandum 127
Submission from Logystyx UK Ltd
EXECUTIVE SUMMARY
Plastic Electronics embraces inorganic as well
as organic electronics and is a new approach to assembly and device
architecture offering greater manufacturing flexibility. It is
also known as Organic Electronics or Flexible Electronics, a reference
to the substrate, ie not glass or circuit board, as well as the
production process.
(i) Current and future roles of engineers
in the field of Plastic Electronics
(a) Currently the majority of professionals involved
in Plastic Electronic industry are from the disciplines of chemistry,
physics and materials science as there are still many basic science
problems to overcome.
(b) The early adopters are currently moving to
pilot production. There is a need for: process engineers; production
engineers; device designers; equipment designers; printers; packaging
engineers. There needs to be training for engineers in management
of the supply chain and production disciplines.
(ii) Potential for Plastic Electronics in
the UK/global economy
(a) UK is global leader in Plastic Electronics.
To maintain its position, resources are needed to compete against
the large international organizations that will inevitably move
into the field.
(b) PE will not replace all traditional electronic
markets but will generate new markets eg Third World, and replace
parts of other markets eg e-print.
(c) Incentives are necessary to encourage large
UK companies that stand to lose their historic business to the
new technology such as: colour graphic printers; printer manufacturers.
Plastic Electronics offers expansion for chemistry-based industries
such as pharma who are used to dealing with nano-materials and
have management structures already in place.
(iii) How Universities, VCs, Industry and
Government are involved in the development
(a) The future success of Plastic Electronics
hinges on the coordination and collaboration of Government, VCs,
Universities and Industry.
(b) Government, through the Technology Strategy
Board, has been instrumental in facilitating Collaborative Research
and Development. So far there has been support of £48M. This
needs to continue as a Managed Programme to guarantee funds are
available to address technological hurdles at the optimal time.
(c) Many of the companies involved with Plastic
Electronics have initial UK VC or Business Angel investment. Where
there is dependence on co-development, it can be difficult to
leverage additional investment and pressure from those investors
for short-term profitability can cause SMEs to drop out of the
sector and their expertise is lost.
(d) Universities are heavily involved in materials
development for Plastic Electronics. However, their role could
be increased and their excellence further exploited if the RAE
could be adapted to include accreditation for scientific solutions
to commercial problems. The current system acts as a disincentive.
(e) To ease the burden for capital expenditure
for SMEs, Open Access laboratories for sample analysis, prototyping
and pilot production are a boon.
(f) To retain manufacturing in the UK, thought
needs to be given to incentives. Companies that will not be profitable
for several years look to maximize grants eg Dresden and other
EU priority areas. Established companies look for tax holidays
eg Singapore and other Far East countries.
(iv) Whether the UK engineering & manufacturing
sectors are set up to handle the growth in this area or others
like it
(a) The talent is certainly available in the
UK but the difficulty has been in raising additional funds in
the UK for growth over the "dip" period moving from
Small to Medium or Medium to Large Enterprises as the infrastructure
has to be in place for a while before profits can be realised
eg both CDT and Plastic Logic had second round financing from
USA VCs.
(b) There needs to be some retraining of corporate
teams to understand new disciplines and new market behaviour.
Mechanisms need to be in place to reduce the pain of overheads
during the transition to the new technology.
(c) UK has expertise in: roll-to-roll manufacturing
and machine design; plastics; colour graphic printing; newsprint;
small scale manufacture of electronic billboards; stringent packaging
requirements eg food and medical industries; printer design including
ink jet.
CASE STUDY:
PLASTIC ELECTRONICS
ENGINEERING
1. Current and future roles of engineers in
the field of Plastic Electronics
1.1 The various disciplines of Engineering
(electrical, electronic, RF & microwave, mechanical etc) will
become increasingly important over the next five years as the
platform of technologies that form "Plastic Electronics"
moves towards volume production.
1.2 The bulk of the work in this sector
has been by physicists, chemists and material scientists. They
have developed the current materials and delivery processes etc,
and proven the principles of device architecture. Now the technologies
must move from laboratory and development onto the production
floor. Scaling up both the complexity of the devices and the volumes
required in manufacture is intimidating but not insuperable and
should be under the control of the Engineering sector in the UK.
1.3 To date, there has been little engagement
with the "conventional" electronics community during
the development of Plastic Electronics. The material sets and
production processes are so radically different that there is
little commonality or compatibility with the design rules for
conventional electronics. New rules must be learnt. It is suggested
that PE technology today is equivalent to early stage development
of the silicon industry in the 1950's. The rate of advancement
of PE technology and growth of the industry will potentially be
much faster than silicon, as it operates in a much more multi-disciplinary
world. Where there has been engagement at University or Company
between the chemists, physicists and traditional engineering disciplines,
the contribution is significant.
1.4 The prototype devices made at various
companies and university laboratories around the UK now need to
be integrated into "real" systems, where the plastic
electronics devices form part of a wider electronic system. This
will require traditional electronic engineering skills to be developed
so that standard electronic components (silicon-based) can be
integrated with Plastic Electronics devices to affect this interoperability.
Over time the percentage usage of Plastic Electronic and Silicon
Electronic devices within any particular application will shift
towards plastic as the performance characteristics of Plastic
Electronic circuit elements improves.
2. Potential for Plastic Electronics in the
UK/global economy
2.1 Plastic Electronics will disruptively
impact every aspect of conventional living across the globe over
the next decade. It will allow completely new technology-centric
solutions. There are a number of third-party Market Research forecasts
available that predict rapid growth of value of the PE marketplace
to multiple billions of US Dollars globally within the next decade.
2.2 A "reality check" on the validity
of these claims is simply provided by comparing the current global
value of the Electronic Displays market (~$120 billion) and the
global Lighting market (~$100 billion) with the value of the European
paper and card market (~$400 billion). The ability of PE to make
significant inroads into many areas of the conventional paper
products suggests that market take-up and growth may be even faster
than initially predicted.
2.3 During the next five years, we will
see the emergence of:
- Intelligent food packaging: plastic or
paper with printed gas or chemical sensors linked to printed circuitry
and display elements on the food packaging container or wrapping
material to indicate if the contents has started to go "off".
A real time indicator of actual food quality could cut food wastage
costs and reduce food poisoning through incorrect storage.
- Smart tags printed on paper or plastic
substrates will be remotely addressable to track location and
ownership. This enables RFID to become more widely used than at
present.
- Intelligent ticketing printed on low-cost
biodegradable substrates will reduce the costs of implementing
ticketing systems like Oyster, and allow mass roll-out of the
technology to a wider application base. Importantly, it will allow
added value functionality to be integrated into tickets similar
to conventional tickets encouraging use of the technology without
alienation of the existing users.
- Electronic newspapers and e-books will
radically change the face of publishing and content delivery.
By creating electronic reading devices on truly flexible substrates,
the current multiple printed page publications that dominate our
reading habits will be changed beyond all recognition. Books and
newspapers will be changed to allow readers to buy one or more
electronic readers of different sizes (we speculate A5 will be
used for typical electronic "book" applications and
A4 for electronic newspaper variants.) As content may be delivered
wirelessly to these devices, we speculate that there will be additional
competition between content providers on device price and airtime
subscription packages. The cost model would be similar to conventional
mobile phone "packages" that "sell" a phone
handset to the consumer at a fraction of its actual production
cost, with profit coming from the airtime deals.
- Plastic Electronic retail signage will
continue to develop from today's small volume usage, where colour
graphic posters are overlaid with printed electronic elements,
to become sophisticated devices printed on large area biodegradable
substrates.
- Printable lighting will facilitate a radical
change to room design. Within large units (houses, offices, etc)
the emergence of printable lighting technologies using Inorganic
or Organic Electroluminescent material will allow "lighting
tiles" to be printed using modified conventional roll-to-roll
volume printing techniques. These tiles may then be expanded upon
to allow "printed electronic wallpaper" to be created,
whereby individual light sources are replaced by the ability to
light complete walls within any room. This will allow mood lighting
and lighting for health to be implemented in a wider range of
applications.
- Plastic Electronics can reduce national
energy usage. One of the key benefits of this nascent technology
is that we can assemble different circuit functions on to a single
substrate material. Alternative power generation (photovoltaic)
can be printed and then coupled to a printed battery, which will
then drive printed circuitry. This will allow a new generation
of self-powered devices to be created that never need to be connected
to a mains-derived power supply.
2.4 The above examples illustrate some ways
in which PE will impact upon our daily lives in the UK. It is
not an exhaustive list, but it is important to note that the platform
technologies that comprise PE can be imported into existing manufacturing
processes within UK. The manufacturing processes for PE are low-temperature,
energy efficient processes that can segue into other industries
such as food packaging, colour graphics printing, pharmaceuticals,
life sciences, aerospace, automotive etc.
2.5 We predict that many of the early adopters
of PE will not be conventional electronic companies but will be
printers, packaging companies, materials handling companies and
similar who adopt PE to add value to their existing material sets/processes/products
etc. This offers an opportunity to industries facing threats from
low cost competition based in China and India, and adds value
to their existing product portfolios with access to new market
applications.
3. How Universities, VCs, Industry and Government
are involved in development
3.1 The majority of initial scientific discoveries
underpinning the PE industry have come from UK University laboratories.
The early exploiter companies commercialising these technologies
are also spin-outs from the same University Departments eg CDT,
Plastic Logic from Cavendish and Nano ePrint from Manchester University.
3.2 The pioneering research at Universities
has grown organically across the UK. We now have complementary
clusters of activity in Manchester, Cambridge, London, St Andrews,
Strathclyde, Bangor, Swansea, Oxford, Hull and elsewhere. This
activity covers developments in materials, manufacturing processes,
device architecture and device production.
3.3 Most of the activity continues to be
within physics and chemistry departments, but we are now beginning
to see substantive engagement with electrical/electronic engineering
and mathematics (for modelling). This trend needs to increase,
and we need proactive investment support from EPSRC to accelerate
this process.
3.4 EPSRC can supply this support through
existing funding mechanisms provided that it becomes a strategic
topic of support, and this support is supplied consistently through
their funding mechanisms eg EPSRC has funded a significant number
of responsive mode projects in this sector, but they have declined
to support UK Displays & Lighting KTN's request to be an agent
for Industrial CASE studentships. This is a serious failure to
ensure consistent support to a target sector.
3.5 There will be an increasing need for
skills training and retraining at undergraduate, postgraduate
and technician level to allow the available pool of manufacturing-quality
personnel to increase with market demand. This training is being
partly addressed by courses run by Liverpool, Swansea and the
multi-University DisplayMasters programme. There will be insufficient
capacity to meet predicted future demand, and the academic requirements
will need to be spread over a much wider University base. This
will require consistent support and co-operation between EPSRC
and Government through DIUS and the TSB to achieve timely implementation
of programmes that will result in the skilled labour pool being
available to match market demand.
3.6 Government has been significantly involved
in the nurturing and development of PE. Through DTI's support
for collaborative R&D through the LINK programme, and then
the Technology Programme, Government investment was consistently
applied to support the initial basic and applied research, and
latterly the move from applied research towards development for
production. The Technology Strategy Board has continued support
and aspects of funding for PE have been included in recent competitions
of their CRD programme.
3.7 However, this funding model is not consistent,
and there is no guarantee at present that the specific requirements
of the community would be met under the new thematic scheme of
project targeting that has been implemented by the TSB.
3.8 In 2006 DTI, in concert with UKDL KTN,
engaged with the UK PE community to develop a comprehensive analysis
of the sector's opportunities for growth, and to understand the
specific needs for targeted support. This resulted in a detailed
proposal for a Managed Programme that would ring fence £50
million funding exclusively for R&D investment into PE over
a period of up to five years. The proposal was centred on the
premise that the PE community is best positioned to assess its
own progress and to identify its own needs for short- and medium-term
research activities. It was planned that an investment panel comprising
a representative selection of companies and academics would identify
the particular technology hurdles that needed to be addressed
at any time, and would run a mini-competition to solicit project
proposals against those topics. The Panel, together with DTI would
agree projects to be selected for support, and the projects would
then be funded under the normal rules. This proposal was very
well received at but coincided with the split of DTI into DIUS
& BERR. The structural change prevented the proposal for a
Managed Programme being taken forward.
3.9 We strongly recommend that a similar
proposal for a Managed Programme to support the PE community with
ring fenced R&D funding be adopted.
3.10 Government has also been involved,
primarily through DTI/TSB and the RDAs and DAs in investing in
regional facilities to operate Open Access process development
and prototype production facilities supporting start-ups and SMEs
in their early stages. Two centres will form the initial support
for the UK:
(a) Welsh Centre for Printing and Coating (WCPC)
based at Swansea University. This facility has expertise in preparing
and characterizing functional electronic inks and pastes, and
a variety of sheet-fed and roll-to-roll printing processes. Support
is offered in material design and process development for "proof
of principle" demonstrators, early product prototypes and
small volume pilot line demonstrators.
(b) Plastic Electronics Technology Centre (PETeC)
based at Sedgefield and Centre for Process Innovation (CPI) based
at Wilton. The CPI facility is already open and trading, and its
sister facility PETeC is due to open later this year. PETeC will
offer a comprehensive range of materials technology and process
development support activities for start-up's, SMEs and OEM companies.
3.11 These two facilities are supplemented
by facilities primarily funded by EPSRC such as the Cambridge
Integrated Knowledge Centre (CIKC) and the University of Manchester
Organic Materials Innovation Centre (OMIC).
3.12 Together, the five centres form the
fledgling platform of support for early stage Plastic Electronics
activities, and it will be essential to ensure consistent funding
to them to allow their activities to be focused on UK-based activities
rather than have them search for additional offshore sources of
revenue. The funding conditions for each of these centres requires
that they seek to achieve self-sustainability in the relative
short-term (two to five years). This requires a focus on revenue
generation that seriously detracts from their primary aim of supporting
and encouraging UK entrepreneurial activity.
3.13 The engagement of the various types
of VC funding with PE is inconsistent at present. VCs such as
Amadeus are strongly involved with early stage developments (eg
CDT and Plastic Logic) but there are no general funds operating
in this area yet. It remains difficult for start-up or SME companies
operating in PE to access early stage funding. If it is practical
for Government to offer long-term tax incentives to VCs offering
financial support to this nascent market, it is likely that the
barriers to involvement in this sector would melt away.
4. Whether the UK engineering and manufacturing
sector are set up to handle growth in this area or others like
it
4.1 Many parts of the required infrastructure
for the UK to benefit from commercial exploitation of PE are already
in place.
4.2 We have manufacturers of inorganic and
organic materials in the UK who will be positioned to meet domestic
demand and supply into global markets. We have manufacturers of
substrate materials (metal foil, paper and plastic including fully
biodegradable plastic on which PE devices will be built) that
can readily meet UK, European and a significant percentage of
predicted global demand.
4.3 We have manufacturers of production
equipment (laser-based, conventional printing presses, ink jet
printing equipments and sub-assemblies, vacuum deposition equipment,
patterning process equipments etc.)
4.4 One strongly beneficial factor is that
many of the Companies that form the infrastructure for materials
and equipments have existing domestic and global markets for non-electronic
applications in areas that are likely to be early adopters of
the Plastic Electronics technology such as Colour Graphics Printing,
Food Packaging and processing, Pharmaceuticals, Retail packaging
etc.
ABOUT THE
AUTHORS
Logystyx UK Ltd is a two-person consultancy
specialising in Display Technology. The partners have been active
in this market sector for 32 years and 26 years. Since 2004, they
have monitored 33 Collaborative Research projects for DTI (LINK
and Technology Programme) and for TSB (Technology Programme) in
the fields of displays, solid state lighting and plastic electronics.
In 2003 they were instrumental in setting up Flexynet, a networking
group for organisations in the Plastic Electronics sector. They
are founders of the UK Displays and Lighting KTN through their
company UK Displays Network Ltd and Flexynet is now a major sub-group
within UKDL KTN.
March 2008
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