Apple, Inc. to Lead Another Revolution?

It's already clear that Apple's (NASDAQ: AAPL  ) early move to 64-bit architecture in its A7 processor for the iPhone 5s has given the tech giant a head start on rivals. In transitioning to 64-bit, Apple began laying out the groundwork for the inevitable shift to 64-bit mobile technology much earlier than its peers. And now its looking like Apple may benefit from a similar head start with its big bet on sapphire glass. When Apple financed the Arizona-based sapphire plant operated by GT Advanced Technologies (NASDAQOTH: GTATQ  ) , it wasn't clear if Apple was making a good move or not. But as Apple continues with its big bet, both Samsung and LG are now reportedly exploring the technology. Does Apple have its competitors scrambling to play catch-up again?

Apple already uses sapphire glass to protect the camera in its iPhones and on the home button of the iPhone 5s for Touch ID.

A revolution?
The current industry standard for mobile display is Corning's Gorilla Glass. Corning, of course, has defended its display material against sapphire on multiple occasions. Admitting that sapphire is superior when it comes to scratch resistance, the company has cited a long list of areas it feels sapphire is inferior, including cost, weight, environmental friendliness, energy needed, and resistance to breaking.

But there must be more to the story. Because not only is Apple already investing heavily in future sapphire production, but now LG and Samsung are considering joining the fray, according to GforGames.

[LG and Samsung] might be forced by the industry to reconsider their decision [to not use sapphire crystal in future displays]. With numerous other gadget manufacturers putting a lot of thought into making sapphire glass feasible, and with Apple already operating the sapphire glass processing plant in US, Arizona, LG and Samsung are supposedly going to jump on the sapphire display bandwagon sooner rather than later.

Earlier this month, The Verge related Apple's big bet on sapphire to the supply chain revolution Apple spurred in unibody aluminum design for laptops. Where the potential parallel development of these two supply chain stories differs, however, is that this time Apple owns the majority of the supply process used in this new manufacturing arm for the industry. This means Apple could be the sole beneficiary of the revolution, if it is one.

If sapphire crystal catches on, Apple's head start couldn't be overstated. "Most companies will be left behind as they do not have the financial reserves that allows a company like Apple to invest in a full-scale production facility dedicated to a single material used in their devices," said MacRumors' Kelly Hodgkins, commenting on the sapphire story from The Verge.

Apple's most undervalued advantage
Apple's combination of enormous size, negotiating power, and operational clout could be its most important asset. Apple has more operating clout among suppliers today than ever before. With its massive stream of earnings ($37 billion in the 12 trailing months) and the world's largest cash hoard for any publicly traded company, Tim Cook has some imposing tools at his disposal to stay at the innovative edge of manufacturing and supply.

Of course Apple's transition to sapphire displays also puts it at risk to the opportunity cost of innovation that exceeds Apple's expectations in Gorilla glass. But if sapphire glass works out the way Apple's move to aluminum unibody enclosures and 64-bit mobile processor architecture turned out, Apple may have just given itself yet another operating advantage. And yes, peers may be left scrambling once again.

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  • Report this Comment On May 25, 2014, at 3:03 PM, CsPPP wrote:

    Really, really, this is the next revolution from Apple you say? This is more like just a screen upgrade, and only slightly at that. Granted there are advantages to sapphire as far as looks go, but this isn't a revolution.

  • Report this Comment On May 26, 2014, at 1:26 PM, crca99 wrote:

    Very informative article and link. I'm finally understanding gorilla glass and sapphire and aluminum and titanium. Thank you.

  • Report this Comment On May 26, 2014, at 2:24 PM, DanP wrote:

    This reminds me of BETA versus VHS of the old days.(Apple versus Samsung).

    BETA with advanced tech, clearer video/audio, higher price. VHS with standard tech, acceptable video/audio, lower price.

    Market decided that BETA disappear into the oblivious...

  • Report this Comment On May 26, 2014, at 6:48 PM, johnestromjr wrote:

    Daniel, Sapphire screens will be a nice upgrade or evolution [rather than a revolution] but, upscale though it be, it's still a screen. An important one for Apple if it holds up well to daily use but....

    A revolutionary material that Apple should be investing heavily is is Graphene which will revolutionize not just tech companies but apparell and others as well. For those who aren't aware of this amazing material do a "Google" search [pains me to use that phrase] and learn about it. I sue hope Apple is looking into Graphene as it's truly going to change the world.

  • Report this Comment On May 26, 2014, at 7:36 PM, truthtrumpsfacts wrote:

    Beta disappeared because it's recording length was short. Apple will be always ahead of competition because they come up with the functionality that others like to copy. Sapphire is not just about being scratch proof, it is about the functionality that users will experience.

  • Report this Comment On May 27, 2014, at 2:44 AM, GaryDMN wrote:

    A case made of sapphire glass and Liquidmetal would be nearly indestructible. You wouldn't need a case for protection. I can imagine the commercials Apple may develop to show how rugged the phone would be.

  • Report this Comment On May 27, 2014, at 11:24 AM, CrazyDocAl wrote:

    First off Apple didn't invent sapphire glass, they just patented a way of putting an anti smudge coating on sapphire glass. They just signed a contract with a company that does make sapphire glass so people assume that it must mean that Apple is switching.

    The rumors I've read is that Apple takes sapphire glass, puts a coating of Gorilla glass on top of it, and then their anti smudge coating. The problem is sapphire glass will not bond well with the anti smudge coating directly. If this is true then I'm not seeing the advantages (other than PR) for using the sapphire since the anti smudge coating and the gorilla glass will still make up the two outer layers and will offer no better resistance to scratching. A second advantage, other than a new marketing name, would be that more displays will break allowing Apple to sell more replacement panels.

    Sapphire has been used on watches for some time now. Secondly while it's more resistant to scratches it's also more fragile. Watches get around this by using thicker glass. Does anyone really think that using a thicker glass panel is going to be an upgrade?

    So what's most likely going to happen is the glass that will be used will most likely be like Corning's Gorilla glass with a sapphire coating that will bond with a new type of anti smudge coating. Since no companies have patented a way of doing this I doubt it'll show up on any phone in the near future.

    Also but LG and Samsung have been looking into Sapphire glass. Since Apple made their move with GT (the real brains behind Apple's Sapphire glass) both Samsung and LG have been in talks with other manufacturers of sapphire glass. Sorry Apple fans, GT is not the only company that makes it.

    Even Apple admits that sapphire glass is weaker than Gorilla glass. They are trying to minimize the fact that it will be thicker and more costly.

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Daniel Sparks

Daniel is a senior technology specialist at The Motley Fool. To get the inside scoop on his coverage of technology companies, follow him on Twitter.

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