www.sfchronicle.com – June 14, 2017
The sight of a person clad head-to-toe in a bunny suit holding a freshly printed sheet of silicon electronics used to be a ho-hum occurrence in Silicon Valley. But a host of semiconductor fabrication plants closed in recent years, leaving the area nearly bereft of the industry that gave the valley its name.
Thinfilm, a Norwegian company, hopes to rejuvenate that heritage. On Thursday, it is hosting opening ceremonies for its 93,000-square-foot chip fab in north San Jose, with scheduled guests including Mayor Sam Liccardo. The building includes a 22,000-square-foot clean room — a production area kept clear of dust, microbes and other particles that could contaminate the chips — built by former occupant Qualcomm, which left last year.
“We are bringing back silicon to the Silicon Valley,” Thinfilm CEO Davor Sutija said after emerging from the clean room, where he wore a bunny suit to keep the environment sterile.
Thinfilm, which is officially named Thin Film Electronics ASA, signed a 12-year lease on the building. It will produce flexible electronic tags and sensors.
These aren’t the same types of computer chips produced by plants like Intel’s last local fabrication plant in Santa Clara, which closed in 2009. Thinfilm’s technology prints components on flexible, hair-thin sheets of silicon and other material. That makes it possible to cheaply mass produce near-field communication tags that can be used for such things as marketing beer, or smart sensors that attach to expensive electronics or apparel to deter shoplifters.
Last week, Thinfilm announced a deal with Caliva, a San Jose medical marijuana and cultivation company, to produce the NFC tags that Caliva will use on its products to dispense electronic educational and advertising materials.
Ultimately, Thinfilm is banking on the rise of the Internet of Things — ordinary objects embedded with technology to become smart, online-connected devices.
The new plant “will enable Thinfilm to further drive down the cost of this technology to just a few cents a tag,” said Mark Hung, lead Internet of Things analyst for Gartner Research. “At this price point, more and more products will be wirelessly connected.”
Sutija said Thinfilm has about 300 competitors, including Plastic Logic Germany, which makes flexible displays.
Thinfilm is using technology it bought in 2014 when it acquired Kovio, a San Jose printed electronics company. The new plant has 110 employees and replaces Kovio’s smaller facility about a half-mile away.
One customer is Coronado Brewing, a San Diego County craft brewer that distributed smart coasters with an embedded Thinfilm NFC chip to market the release of a new IPA. Customers can tap the coaster with their smartphone to launch a video about the beer and the brewery’s collaboration with an coastal environmental protection group, said spokeswoman Melody Crisp.
“The nice thing about Thinfilm is its seamlessness, no downloading an app or scanning a QR code,” Crisp said in an email. “The video automatically popped up and told the story in a new way.”
The plant’s first tags are printed on a foot-square sheet of steel with a layer of silicon, although the combination is still about as thick as two strands of hair, Sutjia said.
The plant this year will start installing equipment that can print NFC chips on long rolls of that material, similar to the way newspapers and magazines are printed on rolls of paper. Officials hope to be producing NFC tags that are the thickness of one strand of hair by next fall, Sutjia said.
More planned equipment will let Thinfilm print tiny, low-power electrochromic displays on thin rolls of metal foil and plastic. Those could be used as disposable temperature sensors that could, for example, show that perishable food or drugs have been safely shipped, Sutjia said.
The company spent about $32 million outfitting the factory, although one main selling point was that the clean room Qualcomm left behind “was already in fantastic shape,” he said.
“We can scale to billions of units of volume at a capital expense that is only 1 or 2 percent what you’d spend on a normal silicon fab,” he said.
Tim Bajarin, president of the research firm Creative Strategies, said he knew of no other plants like Thinfilm’s in the works in Silicon Valley.
“They are unique in what they do and will provide important technology” for the Internet of Things, he said in an email.