Neonode (NEON-OTC.BB) is Changing Your Touchscreen

Posted by Laura Swartz

March 8, 2012 at 10:43 AM

Neonode Inc. (NEON.OBis set to report fourth quarter and year-end 2011 financials on Tuesday, March 13, 2012. In anticipation of those results, now is a good time to take a closer look at the Company and its prospects. Crystal Research has initiated coverage on Neonode with the publication of a 52-page Executive Informational Overview® providing a comprehensive discussion of the Company, its technology, markets, and competitors. The report is complimentary to our readers.

What does Neonode do?

Neonode provides infrared touchscreen solutions that make electronic devices touch sensitive. Its applications include handhelds, midsized consumer, and industrial products. The company operates under a resource-efficient technology licensing model, and receives revenues from non-exclusive, royalty-based licenses to original equipment manufacturers (OEMs), original design manufacturers (ODMs), and component suppliers. The Company’s technology, branded zForce®, holds multiple patents and could rival low-cost resistive touch technologies while outperforming today’s advanced capacitive touch solutions.

The zForce® (an abbreviation for “zero force necessary”) touch technology was designed to overcome many of the limitations of today’s touchscreens. The premise of the Company’s approach entails the projection of an infrared grid across an electronic display. As users tap, swipe, or write on the screen, zForce® detects the location of the touch based on the interruption in infrared light projecting across the screen, which translates to coordinates on the grid. The zForce® architecture and input method is believed to be unique to Neonode.

Where can I find a zForce® Display?

Since 2009, Neonode reports that it has entered into license agreements for the zForce® touch technology with 14 customers. The zForce® is employed in the Kindle Touch eReader from Amazon.com, Inc. and the Nook eReader from Barnes & Noble, Inc., as well as in eReaders from Sony Corp., Kobo Inc., and Koobe Inc. The Company has also licensed its display technology to ASUSTeK Computer Inc. and L&I Electronic Technology Co., Ltd (a joint venture between LG Display Co., Ltd and IRIVER Ltd), among other companies in the tablet PC, mobile phone, and automotive sectors.

 In support of the widespread potential of the zForce® touchscreen to revolutionize the display industry, Neonode received mention on CNBC yesterday as a prospective supplier to Apple Inc. (AAPL-NASDAQ), noting that Neonode is not currently a supplier to Apple. The capacitive display on Apple’s iPhone is activated by conductive material rather than applied pressure. Electrodes in the display recognize contact with an electrical conductor, such as a finger. Such capacitive devices perform multi-touch but cannot be activated by standard pointers or gloves as these are non-conductive. As a result, many users find that their touchscreen can recognize taps from their fingers but not fingernails. In contrast, the zForce® screens offer full finger touch capabilities (e.g., gestures like “pinching” the screen to zoom in or out) as well as high-resolution pen/stylus support in the same solution.

Is there room for Neonode to grow in this market?

The global touchscreen market was estimated at $13.4 billion in 2011, forecast to reach nearly $24 billion by 2017. Neonode believes that it holds approximately 80% of the market for touchscreen interfaces in black-and-white eReaders—a sector expected to ship between 34 million and 38 million units during 2012 (Sources: Forbes and The New York Times). Product launches during 2012 are expected to demonstrate the zForce® technology for a number of new applications, including on a seven-inch color Android tablet from Oregon Scientific, Inc. 

 

Growth of the Touchscreen Market

Topics: Crystal Research Associates, Neonode Inc., infrared touchscreen, touch technology, zForce, New Research

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