LED applications will become the driving force of the bulk GaN market, surpassing established laser diode (LD) and emerging power electronics segments. However, major changes could occur if 4” bulk GaN price gets below the breakeven price. In either a cautious or a more aggressive scenario, LED applications will certainly be the key drivers for the bulk GaN market There is no doubt that LED technology will take market share over the traditional lamp and tube business. The recent announcements from LED makers (> 150 lm/W now in production) are proving that the performance roadmap is in line with expectations: LED does as well and even better than traditional bulbs and tubes. Native bulk GaN emerges as an alternative to sapphire or silicon, allowing further improvement of LED performance. Despite potential performance benefits for UHB- LEDs, massive adoption of GaN wafers remains hypothetical. Taking into account the historical price reductions of bulk GaN substrates, a base scenario outlines where the GaN on GaN LEDs will be limited only to niche markets. If the GaN industry succeeds in replying to the cost pressure from LED makers and the price of 4” GaN wafers falls below the breakeven price, a more significant adoption could be forecast. We see an about three times difference in terms of market volume for LED manufacturing between the two scenarios. The demand of GaN substrates for LD applications will probably decrease below 20k TIE/yr threshold in the coming years Blu-ray applications now represent the largest market for blue LD applications. This market will increase in the short term with the arrival of the new generation game stations. However, we believe that this growth will not persist, as more and more people will play games and watch movies online instead. Despite the recent rapid development of blue and green laser diodes, we see two scenarios for the adoption of GaN based laser diodes for the emerging projector market. The price of LDs is the essential factor to consider. Combining all applications, the demand for 2” GaN substrates will be more than 2 times higher in the aggressive scenario than in the base scenario. In the best case, the demand would keep relatively stable until 2020. In R&D, non polar and semi polar substrates have been proposed for LD manufacturing. In principle, the semi polar approach seems to be the most promising in terms of device performance. In practice, c-plane based devices still have better performance. More than 85% commercial GaN wafers are produced by HV PE, dominated by Japanese companies Today, essentially all commercial GaN wafers are produced by HVPE, but the details of the growth process and separation techniques vary from company to company – for example, ammonothermal growth at Mitsubishi Chemical, and the new acidic ammonothermeral method at Soraa... http://www.i-micronews.com/reports/Free-Standing-Bulk-GaN-Substrates-Laser-Diode-LED-Power-Ele/3/398/

1. Bulk & Free-Standing GaN
Market analysis for free-standing bulk GaN substrates
in laser diode, LED and power electronics applications
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Soraa
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Ammono
Topgan

2. Targeted Applications
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Today, GaN substrates have three targeted applications: laser diode, LED and power electronics. In
the following three chapters, we will have a detailed discussion for each application.
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Bulk GaN substrates
Laser diode
Projection
BluRay
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HB-LED
Industry
& Medical
General lighting
car lighting
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Targeted Applications
Power Supply /
PFC
Power
Devices
EV / HEV
car
PV
inverter &
other
industry

3. Bulk or Free-Standing GaN Substrates
Power Electron.
Mass-market introduction in various applications
GaN/Silicon
GaN/bulk GaN
RF Electron.
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GaN/S.I. SiC
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Opto Laser
GaN/Silicon
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GaN/bulk GaN
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GaN/CVD Diamond
GaN/AlN
GaN/CVD Diamond
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GaN/Sapphire LOG
Opto LED
GaN/AlN
GaN/SiC
GaN/Ge
GaN/Silicon
GaN/Glass
GaN/Sapphire
GaN/bulk GaN
GaN/ZnO
Soraa
< 2009
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2010
2011
Executive Summary
2012
2013
> 2020

4. Different Type of “GaN wafers”
Low Defect GaN
templates (ELO)
GaN Templates
Freestanding
GaN
Engineered
Substrate
GaN boule
(“Bulk GaN”)
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Carrier substrate
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10- 250 µm thick GaN
layer on hetero
substrate with low
dislocation density
areas obtained by ELO
Description
10- 250 µm thick
GaN layer on a
hetero substrate
(sapphire, Si)
< 1x10x in low defect
areas
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300-500 µm thick
GaN layer separated
from a mother
substrate.
Thin GaN layer from
GaN wafer bonded
onto a carrier
substrate
1x10x to 5x10x
Depending on
method
Depends on original
GaN wafer
1x10x to 5x10x
Depending on
method
Low TD,
homogenous with
some techniques. Up
to 4-6” available
Low cost: one GaN
wafer can lead to xxyy engineered
wafers.
Very low TD
Cost, dimensions
Availability
High performance
devices: LD, UHBLED, Power
TD density
7x10x to 6x10x
Benefits
Relatively low cost,
large diameter
available (4”)
Drawback
TD density too high
for LD and UHBLED, wafer bow
TD not homogeneous
across surface, wafer
bow
Cost
Thermo-mechanical
performance driven
by carrier
Possible
Applications
R&D, possible future
in HB-LED*
LD, R&D
LD, UHB-LED, HB
LED, Power
LD, UHB-LED, HB
LED, Power, RF
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LD manufacturing
possible in low TD
areas
GaN single crystals
sliced into wafers
State-of-the-art of GaN substrates

5. Bulk/FS GaN Substrates Market Price Trend up to 2020
•
Interviews with multiple industry players indicate strong uncertainties regarding GaN LED grade
substrates price roadmaps. This leads to two scenarios for price reduction.
– A base scenario derived from historical price trends and our analysis of technology status and
manufacturing costs.
– An aggressive price scenario, derived from the expectation of LED makers and some GaN
wafer makers roadmaps.
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Executive Summary

6. 2013-2020 Overall GaN Substrates Volume
Base Scenario
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In base scenario, GaN substrates will not penetrate to power electronics market.
LED applications represents initial X1% of GaN substrates volume (2 inch equivalent)
and would increase to X3% in 2020.
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Executive Summary

7. 2013-2020 Overall GaN Substrates Market Size
Aggressive Scenario
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For LED and Power Electronics applications, the estimation of market size is based on the aggressive price scenario.
In aggressive scenario, LED applications presents XX% of the overall market size in 2013 and would
be X1.5% in 2020, while LD and power electronics applications would be XX% and X0.5% respectively.
The total maker size is estimated to be $XX7M in 2020.
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Executive Summary

8. Growth Methods Summary
HVPE (FS)
HVPE (Bulk)
Ammonothermal
Na-Flux LPE
High Pressure
Solution Growth
Growth Rate
~ 100 µm /h
Up to 450 µm /h
~ 4 µm /h
~ 20 - 30 µm /h
1 µm /h
Temperature
600 to 1150 °C
600 to 950 °C
400 to 600 °C
800 °C
1600 °C
Pressure
~ 1 Atm
~ 1 Atm
1000 – 4000 Atm
Seed Type
Sapphire, templates,
GaAs…
Sapphire, templates.
Seed Cost
$
$
Max
Thickness
X00 µm (wafer)
X0 mm
Max Diameter
4” available
6” demonstrated
2”
TD denisity
1x10x to 1x10x
As low as 1x10x if
combined with ELO
1x10x to 1x10x
Benefits
Fast growth, Cost efficient
Main
Challenges
NT
50 Atm
10,000 – 20,000 Atm
HVPE FS
Spontaneous or
HVPE FS (MFS)
$$$
0 - $$$
Up to X5 mm
X-X mm
< X mm
2” available in 2013 (Ammono)
Up to 4” demonstrated
<2“
< 5 x10x
~ 1x10x
~ 1x10x
Multi wafer boule,
non polar possible
Low DD, Multi wafer boule
Low curvature
Good compromise growth
speed/DD, low curvature
High quality, low
curvature
Stress, curvature.
Stress, curvature,
TD density varies
along the boule
Slow, purity, transparency*.
Expensive seeds
Yields, scalability,
expensive HVPE FS seed
Cost, small
dimension, scaling
Status
Commercial, mainstream.
Commercial,
Ramping up
Commercial, ramping up. High
level of R&D (Soraa,
Mitsubishi, Ammono)
To be commercialized
soon by Company A, R&D
by various institutes
R&D for high
performance LD
Leaders
Company A, Company B,
Company C + Company
D (R&D)
Company A
Company A (commercial)
Soraa, Mitsubishi,UCSB,
Sixpoint…. (R&D)
Company A (with OSAKA
University), Company B
Company A
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Spontaneous or HVPE FS
$$$
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State-of-the-art of GaN substrates

9. Engineered Substrates Via Smart Cut™
Detailed estimation of manufacturing cost
•
Details of the process are unknown. Our hypothesis are presented in
the table on the right:
Our cost simulation indicates that a ~$XXX cost for a 4” LED quality
engineered is achievable under reasonable hypothesis.
Even with more conservative hypothesis, we believe that if
technologically successful, the engineered substrate approach has the
potential to be extremely cost competitive for the LED market.
Hypothesis
•
Wafer Process Flow
Implantation
Exfoliated layer
Carrier wafer
Bonding
Smartcut
N side CMP
N side cleaning + etching
Ga Side finishing #1
Ga side finishing #2
Ga side cleaning
Ga Side RIE
Ga side final cleaning
Total
1:
2:
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Ion implantation depth
X0 µm
Polishing thickness / cycle
X µm (X µm /side)
Stop thickness1
X00 µm
 # of cycle per donor
XX
$XXXX
Carrier wafer cost2
US$XXX
Ion implanter cost
US$ Xm
Ion implanter throughput
xxx wafer per hour
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Cost (US$)
$
XX
$
XXX
$
YYY
$
ZZ
$
X
$
XX
$
Y
$
ZZ
$
XX
$
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$
Y
$
X
$
XXX
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Donor wafer cost
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Initial donor thickness
4’’ Engineered wafer cost
No more layer transfer possible when donor wafer reaches this thickness.
Assume transparent polycrystaline AlN ceramic but no information publically available regarding actual material.
© 2013•
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State-of-the-art of GaN substrates

10. Main Specifications of Established Players (1/4)
Company
Company A
Company B
Company C
Country
A
B
C
Product
Bulk substrates, Gallium nitride on AmmonoGaN epi-wafers
FS wafers
FS wafers
Growth
Technology
XXXX
XXXX
Seed
XXXX
XXXX
Separation
Slicing
Pro
Low DD, non and semipolar orientations, flat
crystal lattice, multi seeds (up to 150)
Con
High pressure and lower growth rate
compared to HVPE,
Status
In production
Diameter
1". 2" available in 2013
TD density
Lattice Radius
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XXXX
XXXX
Self separation (TiC/Low T GaN buffer)
Self Separation (voids in the vicinity
of the TiN nanonet)
2D growth, self separation
2D growth, self separation
Lower crystal lattice flatness compared
to “true” bulk substrate
Lower crystal lattice flatness
compared to “true” bulk substrate
In production
In production
2", 4"
2“ in production. 4” R&D
5 x 104 homogeneous over the whole wafer,
7x103 in R&D
3 x 106
< 5 x 106
100 to 1000 m
> 5m
< 10 m
Non Polar
Available
Yes
No ? Did some by growing thick
HVPE boules according to USCB
paper review on non polar.
No
Estimated
Capacity (TIE)
Scaling-up with the X000/m target
~ X00 / m
X00 / m now, XX00 /m at the end
of 2013
Comments
Founded in 1999, 2" wafer in 2013.
Company D owns 25%
JV with Company E
Offering both Laser grade and LED
grade. Major supplier of laser
grade.
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State-of-the-art of GaN substrates

11. Bulk & Free-Standing GaN Wafers
Estimated Monthly Production Capacity: 2013
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2013 total production capacity: X730 x 2” wafers/month  XX,760 w/year
Japan companies: XX%
Current leaders: Company A, Company B, Company C
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State-of-the-art of GaN substrates

12. Blue Laser Diodes for Projector Application Market
Two scenarios
•
We see 2 scenarios for the adoption of blue LDs for projection applications:
– Base scenario:
• GaN based blue LDs have not reached that price target yet despite their technical
maturity. The market share for lasers should be limited to high end products.
– Aggressive scenario:
• The price of GaN based blue LDs decrease quickly to $XX, being able to compete with
LED based projection applications.
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* Note that the vertical scales are different in two graphs.
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13. GaN on GaN LEDs
Potential applications (General Lighting)
MR16,
Spot
A19, Bulbs
Downlight
Small form
factor, high
density of
light, focused
beam
High volume
Challenge
Thermal
Management
Omni
directional
beam pattern,
low glare
Comment
Ideal
application
for GaN.
Currently no
satisfying
solutions for
50W MR16
Opportunity for
GaN
High
© 2013•
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High Bay
Decorative
High flux
required,
controlled beam
shape
Design
flexibility
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Illustration
Requirements
Troppher,
Linear
fluorescent
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Directional beam
pattern
NA
High flux
required,
Controlled
beam shape for
roadway lighting
NA
Very large
surface, diffused
light, requires low
glare
Priority is often
to maximize
energy
efficiency rather
than initial cost
Energy efficiency
is important for
total cost of
ownership
Low glow
usually
preferred over
high flux
NA
Low
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Glare and cost
of ownership
are limiting
Can also be build
with cost efficient
Chip On Board
(COB) LEDs
More suited for
low/mid power
LEDs
GaN could
compete when
initial cost is key
Solutions based
on COB or
standard power
package already
exist
Low
Medium
Low
Medium
Medium
LED Applications

14. GaN Penetration % Hypothesis per Lamp Type
Aggressive Scenario
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Note: MR16 are currently the only General Lighting applications having adopted GaN.
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LED Applications

15. Relationships between GaN-on-GaN LED players
$XXXk Endowment for
J.Speck SSC chair
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Makes 50W equivalent MR16
with SSC nPola LEDs
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Makes 30-65W
MR16
equivalent
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LED Applications
Co-Founder:
J. Speck,
S.Nakamura
Sells “nPola” GaN on
GaN LEDs made on
Mitsubishi substrates
Sells GaN substrate
S.Nakamura,
advisor to SSC
Compete!

16. 2013-2020 Bulk GaN Market for Power Electronics
applications: Aggressive Scenario
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• Penetration rate with respect to GaN on Si substrates (GaN on Si substrates volume: source Yole Développement)
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Power Electronics Applications

17. Compound Semiconductors reports from YOLE
Status of the LED
Industry
Sapphire for
Display, Defense,
Consumer…
SiC Market
New!
New!
III-V Epitaxy Substrates
& Equipment Market
LED Packaging
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UV LED MARKET
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New!
LED Front End
Manufacturing
Technologies
Sapphire
CoSim+
Sapphire for LED
GaAs Wafer Market
& Applications

18. Yole Activities
MEDIA
REPORTS
CONSULTING
News portal/Technology magazines/
Webcasts/Communication services
Market & technology/Patent
Investigation/Reverse costing
Market research/Technology
& Strategy/Patent Investigation/
Reverse costing
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www.yole.fr
YOLE FINANCE
M&A/ Due Diligence/ Fundraising/
Technology brokerage
Y
www.yolefinance.fr
SISTER COMPANY
Reverse engineering & costing/
Cost simulation tools
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19. For More Information…
Please take a look at our websites:
www.yole.fr
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Yole Développement corporate website
www.i-micronews.com
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Our Offices & Contact
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Sister company; expert E teardown & reverse costing analysis
D in
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YYole business unit dedicated to financial services
Separate
News Portal - free online registration to our publications
Follow us on
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20. Our Offices & Contact Information
Europe Office
• Yves Devigne, Europe Business Development Manager,
Cell: 33 6 75 80 08 25 - Email: devigne@yole.fr
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• David Jourdan, Headquarter Sales Coordination & Customer Service,
Tel: 33 472 83 01 90, Email: jourdan@yole.fr
USA Office
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• Michael McLaughlin, Business Development Manager,
Phone: (650) 931 2552 - Cell: (408) 839 7178 - Email: mclaughlin@yole.fr
• Jeff Edwards, Sales Associate, Yole Inc., Cell: (972) 333 0986- Email: edwards@yole.fr
Japan Office
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• For custom research: Yutaka Katano, General Manager, Yole Japan & President, Yole K.K.
Phone: (81) 362 693 457 - Cell: (81) 80 3440 6466 - Fax: (81) 362 693 448 - Email: katano@yole.fr
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• For reports business: Takashi Onozawa, Sales Asia & General Manager, Yole K.K.
Email: onozawa@yole.fr
Korea Office
• Hailey Yang, Business Development Manager
Phone : (82) 2 2010 883 - Cell: (82) 10 4097 5810 - Fax: (82) 2 2010 8899 - Email: yang@yole.fr
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