Apple strikes sapphire supply deal with GT Advanced

Apple has struck a sapphire furnace/supply deal with GT Advanced,” Seeking Alpha reports.

“The deal, announced within GT Advanced’s (GTAT) Q3 report, calls on GT to supply Apple (AAPL) with sapphire via furnaces the former company will own/operate at an Arizona facility owned by the latter,” SA reports. “GT plans to employ 700+ people at the facility, and Apple will be providing GT with a $578M prepayment to assist with the efforts. GT will reimburse Apple for the prepayment over five years, starting in 2015.”

SA reports, “The magnitude of the initiative suggests Apple plans to use sapphire cover glass to protect the displays used in future iOS hardware (perhaps including 2014 iPhones/iPads).”

Read more in the full article here.

MacDailyNews Take: As we wrote on October 23rd:

Hello, sapphire glass iOS device displays!

Related articles:
Gorilla glass maker Corning enters into strategic partnership with Samsung Display – October 23, 2013
Sapphire glass may be used in 2014 iPhone Retina display, sources say – September 18, 2013
Sapphire glass may be used in 2014 iPhone Retina display, sources say – September 18, 2013
Vertu COO: Apple investigated sapphire crystal displays, but found them infeasible at this time – June 13, 2013
Corning’s Gorilla Glass vs. sapphire for mobile touch displays – May 28, 2013
Apple’s next iPhone screen could be made of Sapphire – May 2, 2013

42 Comments

  1. Like i said just yesterday:

    Apple will eventually have secure control of their manufacturing and production, they need to kick the spaceship command and control center into realization.

    Reality strikes – go Apple!

    1. This isn’t about secure control of their manufacturing, it’s about an iWatch. MOST luxury watches use a Saphire crystal display because it’s scratch resistant. It’s not Shatter resistant though. However, the weight of a smart watch and the risk of dropping something strapped to your risk make that less of an issue.

  2. Is it not SJ that got Corning to commercialize and produce Gorilla Glass for consumer electronics devices, such as cell phones? Prior to that I thought they were just sitting on the technology, unsure of how it could be used.

      1. In reality, I think it is likely that an exclusive deal between Apple & Corning may have been discussed, but real world competition likely nixed such a deal.

        If Corning refused to quickly supply Gorilla Glass to the whole electronics industry and keep upgrading it, competitors like Samsung would have spent the time and money to develop workarounds and Corning would have been out that market share. Plus you know how Samsung competes.

        Corning knows they have to keep moving forward or die, just the opposite of what Studebaker, Kodak and Polaroid did.

        1. The exclusive deal for Gorilla Glass was short lived, and it did not include Gorilla Glass II.

          Samsung bought in. They now are in the preferred position to know what deals are going on between Corning and any competitors. (No need for lawyers to improperly, and potentially illegally, divulge documents to Samsung management. Samsung will get access to a lot of them directly.)

          It is wise for Apple to expand into other options.

          And, as an aside, Corning was in big trouble after the “doc com bubble burst”. They invested way too much in things like fiber optics. Corning even started outsourcing (to Spain no less) its famous and revered Steuben Glass business. (Waterford and the rest were poor competitors to the highest end Steuben.) Corning even shut down Steuben for a while.

          To so some extent Gorilla Glass and other recent products have saved Corning. But Corning needs to be careful with whom they bed down. Any close interaction with Samsung is extremely hazardous at best.

    1. That is true. Apple approached Corning for suitable touchscreen glass. Corning pulled out some previous R&D work and tagged it Gorilla Glass. Corning quickly saw the value of this new product, and developed Gorilla Glass 2. The process continues…

      Samsung is shipping a lot of devices and has undoubtedly become a very significant customer for Corning (thanks to Apple for working with Corning and for Google ripping off Apple IP). Apple is still a significant customer, and Corning has to honor its supplier contracts.

      But Apple has always been forward-looking with respect to the application and integration of new technologies. Some of those technologies have not (yet?) gained widespread use, such as liquid metal. Others appear to be expanding rapidly (Touch ID). Sapphire glass could be the scratch resistant touchscreen material that (once again) places Apple years ahead of the curve.

      1. Apple may trump everyone if they manage to get a clear tough material (Aluminum oxynitride?) other than glass and put a sapphire surface on it, which Samsung does not have.

        I would not put it past Apple to great a “non-glass” cover for touch LCDs.

  3. I don’t know if this is fact or fiction but I like the idea.

    Apple, with the concurrent releases of the 5c and the 5s, has bifurcated the iPhone line-up. The two lines, in my uninformed opinion, will continue to diverge over time. Sapphire glass may be one of the differentiators.

    We’ll see.

    1. I could see how you could come to that conclusion as it’s not uncommon for companies to do that. Apple on the other hand is all about non diverged tech. Yes they have some tech deficits on lower end products but that’s by design. Many of the lower end products don’t need all the bells and all the whistles. In fact for some it’s out of reach, what Apple has done so far was a wise and good compromise. Having said that the screen is key, the strength is paramount so I say if they go to sapphire glass they use use it everywhere. The difference here is Apple just wrote a BIG check and will want to leverage that onto all its goodies and give the non settlers the best design and best screen.

      1. … “BIG” for you or me, but that represents less than 1% of Apple’s Cash Pile.
        That said, I wasn’t aware that sapphire was something that could be manufactured! Like glass and diamonds. Is it stronger/less fragile? Stronger for a like weight/thickness? Is this the “reason” behind the broken-glass ads on TV?

        1. There are a number of plasma deposition processes in a vacuum lay down molecular layer thick anti-scratch surfaces like Sillicon Dioxide and others.

          A friend of mine worked on this for scratch resistant auto-windshields a decade back, but technical issues scotched the project.

    2. I don’t think so, Corning has entered into a “strategic partnership” agreement with samsung. After offloading some of corning’s production work, samsung will no doubt announce S-glass (a rip off of corning’s technology & manufacturing techniques)
      Apple is setting the ground work to steer clear of this train wreck.
      Unfortunately the only real looser here will be Corning. (but arrogance, stupidity and naiveté in business has real consequences for you and your shareholders, just ask anyone who worked or held stock at Nokia)

  4. Do not be fooled by the sequence of the Corning and Apple announcements. It is reasonable to assume that Apple notified Corning (or that Corning had a very good idea) that Apple would not be using their glass in future Apple products, and it is this which prompted Corning’s alliance with Samsung. The Apple announcement must have been made after lengthy evaluations and discussions, so it is not a reaction to the Corning-Samsung alliance.

    Note that Apple is continuing to return production to the US where it reasonably can. All the leaks from the China supply chain, apart from anything else, make this desirable.

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