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GT Advanced Technologies Officially Announces Sapphire Settlement With Apple
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I think its safe to say GT won't be giving anyone a competitive advantage anytime soon. If that were a concern of Apple they easily could have bought GT. For whatever reason, we must conclude that GT's equipment and IP are worthless in any industry that Apple cares about. Ouch.
SO,
WHO
is going to make all the Sapphire Glass Apple needs today, for camera and Touch ID glass, Plus for some of the iWatch models, that will need it this spring???
I was thinking Apple would license the techology and simply do it themsleves? Not sure if this is possible, but great question. (And by themselves, I mean Foxconn or another partner.)
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Apple took a risk, invested, and it bit them in the end. Happens to traders/stock holders every day on Wallstreet.
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Or license out the technology, patents, equipment, and source it out to Foxconn as part of Apple's manufacturing process?
I think this mess all comes down to Apple deciding, late in the game, that sapphire was not a possible/practical/affordable solution for mobile device screens.
From this decision Apple then decided to cover it's ass for making an impossible/impractical/unaffordable decision in the first place.
The most powerful organizations in the world can get away with this type of stuff.
From this decision Apple then decided to cover it's ass for making an impossible/impractical/unaffordable decision in the first place.
The most powerful organizations in the world can get away with this type of stuff.
So I thought to buy some speculative stock some weeks ago (the GTAT ones) only to find out today that there is new stock GTATQ that rises like crazy while the GTAT is delisted.
How does that work when this whole exercise is winded down? Is the 'final' GTAT stock price also what will be paid to shareholders?
How does that work when this whole exercise is winded down? Is the 'final' GTAT stock price also what will be paid to shareholders?
Looks like GTAT were recently forced to return $24 million to a Taiwanese manufacturer for selling them faulty Sapphire furnaces.
So yeah, Apple weren't the only ones screwed by GTAT's furnace of fail. If they were selling faulty furnaces, it's a good bet that their own furnaces had the same faults which caused them to miss the technical milestones demanded by Apple.
So yeah, Apple weren't the only ones screwed by GTAT's furnace of fail. If they were selling faulty furnaces, it's a good bet that their own furnaces had the same faults which caused them to miss the technical milestones demanded by Apple.
I'm still not so sure that sapphire would make that great of a phone screen anyway. Those who have tested it are saying that it is far more brittle than even regular glass. Sure, it may resist scratching better, but apparently if you drop your phone sapphire is a lot more likely to shatter.
Considering the number of broken screens on iPhones, I'm not sure customers would be very happy if this number was to skyrocket after switching to sapphire. Maybe a sapphire coating on Gorilla Glass would be the best combination, if such a thing can be done.
Considering the number of broken screens on iPhones, I'm not sure customers would be very happy if this number was to skyrocket after switching to sapphire. Maybe a sapphire coating on Gorilla Glass would be the best combination, if such a thing can be done.
Whaaaaa?!?! No such equipment existed? Please tell me you're either joking or genuinely unaware. Apple gave GTAT a loan to purchase furnaces. Furnaces that were currently on the market. Furnaces that are used by other sapphire manufacturers as well. What GTAT had that was unique was Hyperion ion implanter technology (purchased from Twin Creek before dealing with Apple), or a way to slice sapphire thinner and more cost efficiently (didn't work quite as expected for high volume yield, which is why we're here).
They have the furnaces because of Apple. They had the tech prior. That's why Apple partnered with them. Ton of money is relative. For Apple it wasn't that significant of an investment, soon to be mitigated further by liquidation of the furnaces. What competitive advantage? Any company attempting to work with GTAT's IP is going to face the same problems that Apple faced: volume yield. Even if they get it to work the cost will be substantially more since I doubt GTAT will ever be dumb enough to sign another contract like the one with Apple. Bolded: Relativity seems to be the bane of your argument. Your life savings and Apple investing $500 million are orders of magnitude apart. A man losing $100K when he only has $150K is screwed. A company losing $500 mil - payback when they have $150+ billion in cash is not screwed by any stretch. It amounts to a write off.
Let's agree to respectfully disagree. Apple got what they wanted now that the deal is dead. They wanted the details of the contract to remain secret and they will apparently remain secret. GTAT technically owns the equipment. But dormant furnaces don't make money AND you keep overlooking the fact that they can't keep the furnaces. They have to sell them and give the money to Apple. So the old saying. "Ownership has it's privileges" does not apply here. The IP that didn't work. GTAT brought it to the table and it seems Apple says they can take it away. If Apple thought it was viable in the foreseeable future, they would have mostly likely made it apart of the current deal.
I never said every problem. We were specifically talking about scaling problems in the context of sapphire. Sapphire is made in furnaces. If you have one working furnace, you can make as many as you need, it just takes time. If the furnaces aren't ready this year, or aren't a faithful enough copy of the original one that worked, well, you can easily fix both for next year. Doesn't explain this deal falling through.
P.S. If this was just a matter of GT not getting enough output, Apple would NEVER let them out of its clutches least they take the tech to a smaller competitor such at BB or HTC and give them an advantage Apple can't match.
That's only really right with well tuned processes. If you have to babysit something, or it requires the highest expertise to get right, it could well be very hard to scale.
Yes, I agree it was a loss for both, and unfortunately Apple really got it in the shorts!
Anybody that says "Apple has plenty of cash, it doesn't hurt them" is wrong!
Business is about making money, and Apple has earned their wealth. That's what business is all about!
If I ran my business with attitudes like that, all my profits would slowly dissipate. $439 million is a big deal to just throw away, because some CEO could not produce what was promised. To a small extent some of my employee's, at times, think this way, it's disheartening!
It appears the CEO of GTAT, new long before they could not produce what was promised! Then he sold his stock off, made a bundle for himself, and a couple others, leaving employee's & investors high and dry! The CEO deserves a good ass kicking!
I hope the SEC goes after this sht fck, clearly he knew they failed! Then sold his stock off, knowing, it was not worth ****!
Why should Apple not get interest over the 4 year period that GTAT has been given, to repay a portion of the loan??? Why does the CEO of GTAT get to keep the money he made from selling stock??? I know what some will say, "he didn't file personal BK". I get it, but it's just not right!
Someone (CEO and others) new long before they were not going meet the terms, and were still going to take the last $139 million from Apple? What was their plan, IMHO, I know what they were going to do, file BK after getting last payment on loan! Apple woke and put the brakes on, and the CEO of GTAT just moved up BK date!
Anybody that says "Apple has plenty of cash, it doesn't hurt them" is wrong!
Business is about making money, and Apple has earned their wealth. That's what business is all about!
If I ran my business with attitudes like that, all my profits would slowly dissipate. $439 million is a big deal to just throw away, because some CEO could not produce what was promised. To a small extent some of my employee's, at times, think this way, it's disheartening!
It appears the CEO of GTAT, new long before they could not produce what was promised! Then he sold his stock off, made a bundle for himself, and a couple others, leaving employee's & investors high and dry! The CEO deserves a good ass kicking!
I hope the SEC goes after this sht fck, clearly he knew they failed! Then sold his stock off, knowing, it was not worth ****!
Why should Apple not get interest over the 4 year period that GTAT has been given, to repay a portion of the loan??? Why does the CEO of GTAT get to keep the money he made from selling stock??? I know what some will say, "he didn't file personal BK". I get it, but it's just not right!
Someone (CEO and others) new long before they were not going meet the terms, and were still going to take the last $139 million from Apple? What was their plan, IMHO, I know what they were going to do, file BK after getting last payment on loan! Apple woke and put the brakes on, and the CEO of GTAT just moved up BK date!
Yes, I agree it was a loss for both, and unfortunately Apple really got it in the shorts!
Anybody that says "Apple has plenty of cash, it doesn't hurt them" is wrong!
Business is about making money, and Apple has earned their wealth. That's what business is all about!
If I ran my business with attitudes like that, all my profits would slowly dissipate. $439 million is a big deal to just throw away, because some CEO could not produce what was promised. To a small extent some of my employee's, at times, think this way, it's disheartening!
It appears the CEO of GTAT, new long before they could not produce what was promised! Then he sold his stock off, made a bundle for himself, and a couple others, leaving employee's & investors high and dry! The CEO deserves a good ass kicking!
I hope the SEC goes after this sht fck, clearly he knew they failed! Then sold his stock off, knowing, it was not worth ****!
Why should Apple not get interest over the 4 year period that GTAT has been given, to repay a portion of the loan??? Why does the CEO of GTAT get to keep the money he made from selling stock??? I know what some will say, "he didn't file personal BK". I get it, but it's just not right!
Someone (CEO and others) new long before they were not going meet the terms, and were still going to take the last $139 million from Apple? What was their plan, IMHO, I know what they were going to do, file BK after getting last payment on loan! Apple woke and put the brakes on, and the CEO of GTAT just moved up BK date!
Sound analysis!! I guess we can look at this as one of the risks for taking on US manufacturer. A lot of unethical CEOs for short term gains only.
That sounds like youre saying Apple should be happy because they avoided blackmail.
GT got the ion canon patent and screwed over their own shareholders, their workers, and Apple.
Apple learned what happens when you try to have your manufacturing done in the US.
I can't claim any special technical knowledge about this process, and I suspect nobody else posting here can either. But the question was asked how Apple and GT could have gone this far down the road together without picking up on the problems they quite obviously encountered in mass production. Discounting for the highly remote possibility that they did not test the process adequately at a lesser scale, the only logical answer to this question that I can come up with is one of scaling. How or why, I have not a clue.
Thank you!
Yes, it's really disappointing regarding what you pointed out, bringing manufacturing back to the US. Apple brought the Mac Pro back here and, it looks like they were trying to do more.
Not at all. Apple didn't avoid blackmail. They avoided standard disclosure in bankruptcy proceedings. What I am saying is the resolution was a "best of a bad situation" for both parties. Nobody won anything except the execs who cashed out.
Apple got to keep their business dealings private and will get some money back in the future.
GTAT got to keep their suspect IP - which didn't work well for Twin Creek either. They get to try to find another investor. I doubt they will be successful given the actions of the execs and the results of their process.
In this debacle the employees got screwed royally. I don't feel one way or another about the shareholders because the stock market is a gamble anyway. People lose and gain money in the market everyday. The inherent risk of the market is a known variable.
Apple is planning to have sapphire only on the high end watches. Those I assume are going to be lower volume in terms of units sold, so yes, but the volume should be low enought that they can source the sapphire easily enough. But at the volume and size of a the iPhone's you really do need the bigger sapphire yields that GT's technology proved not to handle after all.
How is it against own country with the obvious repeated patterns of the same behavior? What is your magical solution?
Just being realistic, I suspect. Americans can't manufacture things because the executives are only in it for short term profits. They aren't willing to make the required investments or deal with early and costly setbacks. They don't have passion for the product, it's all just widgets like they were taught in MBA school, so they think managers are all interchangeable and don't need to know anything beyond how to manage a business.
Some like to blame unions but in Germany unions are far stronger than in the US and German business builds some of the best machines in the world. I don't know about GTAT but being based in AZ I'd wager they aren't dealing with a union, either.
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Not really. Obviously if it requires an operator with 5 years of experience, that's going to slow down scaling while more operators are trained. However, Apple's quite capable of taking the long view. Again, not the issue here.
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I don't disagree that that's an 'obvious' thing to consider, but it doesn't really add up, and it doesn't explain Apple and GT's conduct here, which seems to mostly close the door on this tech entirely (there is some blah blah blah language in the press release that muddies the water a bit). Another possibility is that GT was able to meet early quality control tests with a different more expensive manufacturing process, and actually misrepresented their ability to create sapphire in volume at low cost.
What's "a lot"? I've been in the materials business for a long time and I've very rarely seen unethical CEOs.
My guess (all it is) is this company was in over their heads and Apple didn't recognize it in time. It's not hard to believe considering no company has a track record in trying to do do what they ultimately failed at.
Hmm I guess it is subjective. You are right in some regard. I guess main focus would be banking and the out of line pay for CEO since they made it public in comparison to CEOs globally for their value to the company as a whole. I recall an article stating short term plays to get the stock up near term while ruining the business and they up and leave with their golden package and move to the next company and repeat.