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The iPhone's Next Victim: Water

Raise your hand if any of the following has happened to you.

  • Your iPhone is your workout companion that you strap to your arm for daily runs, and you've been known to perspire profusely on occasion and your excessive sweat has seeped into your gadget, ruining it.
  • Your cat has a mind-boggling fascination with knocking over cups, but only when full of water, and the most recent instance drenched your iPhone.
  • Your inebriated pals thought it was a dandy idea to overpower you and toss you into the pool at the last party without giving you a warning and a chance to empty out the contents of your pockets, which included your iPhone.

Sadly, such occurrences are all too common, and high-priced casualties result, which is why Apple (Nasdaq: AAPL  ) has multiple liquid-damage sensors built into the iPhone, since liquid damage escapes warranty coverage.

But according to a recent Pocket-lint report, water damage may soon be a thing of the past. Apple is supposedly in talks with small Utah-based company HzO, which has pioneered its WaterBlock technology to protect gadgets from H2O.


The technology uses a nano-scale film barrier that repels water and can be applied to the guts of gadgets. It would need to be applied during manufacturing, as opposed to aftermarket installation. WaterBlock was so impressive it also garnered the attention of other smartphone makers, including Samsung and Motorola Mobility (NYSE: MMI  ) , even though Motorola's new RAZR uses its own Splash Guard nanotechnology.

HzO was on display this month at the Consumer Electronics Show and even took home the CES Innovations Design and Engineering Award. Who stands to gain if HzO inks a contract? While HzO remains a small, privately held company, two of its investors are publicly traded.

Nanotechnology venture-capital company Harris & Harris (Nasdaq: TINY  ) counts HzO in its portfolio and was quick to point out the award its investment grabbed at CES. Gadget accessory maker ZAGG (Nasdaq: ZAGG  ) also forked over $7 million recently for an equity stake in the company and currently is the largest equity owner of HzO. There are other investors, but these are the only two that the average Joe can get his hands on. If HzO achieves certain milestones, investors will pony up another $4.5 million.

ZAGG will also do what it can to help with distribution and marketing, helping HzO roll out the first HzO-coated consumer devices.

If HzO's WaterBlock can take off, ZAGG and H&H will have a blockbuster on their hands, and consumers will have one less thing to worry about on theirs. The demos are definitely impressive enough to give this idea some credence, with one clip showing a demonstrator nonchalantly dumping a handful of gadgets into a fish tank, followed by dangling an iPod Touch into the same tank while continuing to pump out tunes to a connected portable speaker.

Watch out, water: The iPhone may be coming for you next.

Water's oppressive tyranny over electronic components may at long last be coming to an end. The timing is perfect, as component suppliers will be free to ride the waves of the mobile revolution without always having to stay high and dry. With the aquatic dictator soon to be out of commission, you'll need some investing ideas on which component suppliers are winning from the iPhone, iPad, and Android Revolution. Get access to this 100% free report that names 3 companies inside virtually all mobile devices. Check it out now -- it's free.

Fool contributor Evan Niu doesn't understand why his cat loves knocking over glasses only when filled, but luckily his iPhone has never been caught in the crossfire. He owns shares of Apple, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Apple. Motley Fool newsletter services have recommended buying shares of and creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (3) | Recommend This Article (17)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 21, 2012, at 3:47 PM, prginww wrote:

    Harris & Harris Group (TINY) Announces Investment in HzO, Inc today announced it has invested $1,666,667 million in HzO, Inc., as part of a $7 million Series B Preferred financing.

    So ZAGG did not invest 7 million.

    ZAGG executives, acquired the remaining interest in HzO still held by NMI, allowing the new HzO investors, ZAGG executives and ZAGG to own 100%. Since that time Harris & Harris Group, Li Ka-shing's Horizons Ventures Partners, Prudence Holdings and Pike Capital Partners watered down ZAGG's 100% to 40%.

  • Report this Comment On January 21, 2012, at 4:00 PM, prginww wrote:

    TINY's $1,666,667 million in HzO is well too TINY therefore ZAGG is the only way to play HzO. Also HzO address matches ZAGG's address. i.e

    Headquarters, ZAGG SQUARE, 3855 So. 500 W. Suite B is ZAGG address, correct?

    Headquarters, HzO ZAGG SQUARE, 3855 So. 3855 So. 500 West, Suite R, correct?

    HzO is Suite R and ZAGG is Suite B.

    For some reason reports about ZAGG have all been wrong or scams. They can't even report the HzO correctly here or in seekingalpha.

  • Report this Comment On January 23, 2012, at 3:32 AM, prginww wrote:

    Hzo is not scalable and is to expensive to apply as well as to difficult to work with. This company is just hyping stock. Other companies such as Liquipel are getting big contracts with their technology.. With liquipel would issue IPO 

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