Tuesday, March 31, 2009

LDK Scale - Speculation.

In the next 5 years or so, research will continue at Universities and Companies around the world, and some of that research will involve wafers. There will be technologies to benefit the manufacturing process, and there will be some to benefit the capabilities of the wafers themselves.

Ok, so say you're a leader in one of those companies or one of those programs. You will want to make money off of your investments in time and money.

Depending on the details of the technology, of course, you might be looking to license it out, or else you might make use of it yourself.

If you make use of it yourself, you'd better realize that there are tremendous costs in time and money involved in making your own wafers, and if you want to avoid the volatility of the poly market, then that's an even greater cost. Maybe this is still your decision. So be it, you have wafer tech, and you start a massive ramp up to support that tech and keep it to yourself.

But what about if you want to license that technology? You have the design, but you don't want to try to control the entire implementation and operations. Instead, you find partners in the industry that will pay you for their ability to use that technology to enhance their own products and technology.

So, who are you going to go to? Are you going to go to the company that is going to implement your ideas on 50MW worth of wafers per year? 100MW? 1000MW?

Who do you think?

Really, it's like Walmart. Walmart has a constant stream of "entrepeneurs" trying to sell them their products. If Walmart decides to sell your product, then you're set.

LDK will have many opportunities to leverage their volume with any number of technology partners over the next years. To their mutual benefit.

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