Wrong, says Matt Thomas.
The CEO of Austin, Texas-based Illumitex says his company's light emitting diodes aren't just energy-efficient -- they're optically efficient, too, thanks to a company focus on using product design to direct the light for optimal "light extraction."
According to Thomas, Illumitex bulbs are better, brighter and one step ahead of the competition. I spoke to him last month.
SmartPlanet: Let's start at the beginning: how did Illumitex come to be?
MT: We're based in Austin, Texas because my co-founders and I have spent our entire careers here in the high-tech industry. It's a fantastic environment to start a business -- we're often called the "Central Coast." In particular, there are a lot of cleantech and venture-backed companies.
This was a true garage startup -- we were literally building parts in [vice president of engineering] Paul [Winberg]'s garage. We thought, we have some breakthrough LED technology that can change the world as we know it.
SmartPlanet: So what's your value proposition? There are a lot of LED companies out there.
MT: We take a unique approach to LEDs. We look at them differently than any other LED company on the planet. We don't look at it as a chip -- we're really creating light. That means all of the optics and light extraction mechanisms that go into that package that turns into beautiful light for fixture manufacturers. We focus on the technology behind the bulb.
We focus on all general lighting -- light delivered through a specific work plane. For indoor lighting, commercial lighting is a perfect example. In most applications, it's a work surface -- your desk. It's also racks of goods, inventory, assembly areas -- all types of high-bay lighting.
For outdoor lighting, it is definitely about street lighting, outdoor signage -- billboards on the side of the road need uniform light but [by law] can't reflect light off the edges -- and retail. When you walk into a high-end food store, they want to highlight their product.
No one else in the world can produce the lights we produce.
SmartPlanet: So where do you fit into the food chain? Quality? Value? Is savings even possible, from a marketing standpoint, over other LEDs?
MT: Actually, we end up saving people money by increasing the efficiency of the delivered light by 20 to 50 percent.
What's the end goal? To provide better quality light at a lower total cost to the end user. We do that in several ways, through energy-efficient savings that have a two- or one-year payback period. We're delivering more light when you want it so you need less electricity at that fixture, plus lower maintenance costs and replacement costs.
Most people don't think what goes into their light fixture in their house. When it comes to designing one, there's the LED, the driver, the mechanical and thermal, and the fourth part -- 20 to 25 percent of materials -- is secondary optics. It can be a lens, a reflector...we eliminate the need for those secondary optics altogether. That's a direct savings for our customers. We do that because we basically incorporate those optical elements -- a 10-degree beam angle, or eliminating dark spots -- we build all that into the package of the LED itself with no additional delivered cost.
What manufacturers can actually do now is make their fixtures smaller.
We just launched our first product in April, and we've already got eight to 10 customers right now, with installations in the field, and more designs on the way.
SmartPlanet: If it's so obvious, why aren't established light companies simply building better lights?
MT: Why aren't our customers doing something different? Because they don't have the tools in their toolkits to do something yet.
When you look across the LED space, you have to remember that it's only an $8 billion industry worldwide, but it's growing at 30 to 80 percent a year. That's an incredible growth rate, and most companies are only focused on the established companies, who are increased at improving efficiency at the chip level.
My co-founders and I, none of us come from the LED world. But all of us have optics in common. We rethought the LED itself.
SmartPlanet: Do technologists control too much in the LED industry? Too much focus on chips, not enough on light?
MT: LEDs are just now starting to penetrate the softer side of life: general lighting. LEDs last year were less than 1 percent penetration into the $100 billion general lighting industry.
Historically, LEDs have been behind the scenes, where it was really about technology performance: backlighting for cell phones, computer displays, traffic lights. That's really all changing now, and you're starting to see more focus put on, what is the quality of this light?
SmartPlanet: So who's buying all these LED lights?
MT: The lighting industry in general, the big three -- Sylvania, Philips, GE -- historically, they only control 15 percent of the lighting market. There are a whole host of small to mid-size players across the world. In the U.S., you'll find BetaLED, or Lighting Science Group in Florida, who are at the forefront of lighting technology in LEDs.
Across the board, there are 500 new LED lighting companies in the U.S. created in the last two years. Same thing is true in China. I think it was 55 percent of all LED purchases by dollar volume were in China last year. They're going only with green technologies, nothing else.
Most of the companies are concentrated in Asia and the U.S.
In China, because there is such as lack of built-out infrastructure, as the country is expanding and growing, its economy...there is a need for a very rapid construction of infrastructure. What that means that China has recognized that it has a pollution issue. Therefore all their technologies they're aiming at are green. That's good news for us, because truly, every new building or road or rail or ship will use LED lighting. It's really across all of Asia. It's the technology of the future, but it's here today.
In the U.S., it's more of a replacement [technology]. They'll take off when the economics make sense here.
One of the great things about being an LED company is that we're making a difference in the world at the same time we're making money for investors. You don't often find that. It's a unique situation to be in.
SmartPlanet: Are you worried about LEDs becoming a commodity, like any piece of hardware? Or is it too early for that?
MT: Today, there is so much opportunity for innovation. Innovation always prevents things from becoming a pure commodity play. The theoretical efficiency for an LED is 400 lumens per watt. Today we're only at 100. That means that we have a long way to go -- decades -- before we max out the technology innovation.
While you're increasing efficiency, you have to decrease cost. Haitz's Law emulates Moore's Law on the LED side. We're not in this business to be a commodity supplier.
SmartPlanet: How do you tackle the big three? Bridgelux CEO Bill Watkins told us that it's a cyclical thing: nimble startups overturn slow-footed, established corporations.
MT: I started my career at 3M, which is primarily known for innovation -- they're always looking to stay ahead. There are examples out there of companies that can innovate, set aside their concerns about margins and really move ahead.
Kodak is an example of the opposite side of things: they had been making incredible margins on film and development paper for 100 years and frankly didn't want to adapt to the digital revolution that was clearly coming. They failed. There are examples on both sides.
Absolutely what we bring to the table is an ability to move very quickly, to meet customer demands and continue innovating and push the envelope. What is it really that the general lighting industry needs from its LEDs? We want to be the supplier of choice so that our technology is driving the LED revolution that is now taking place.
SmartPlanet: You innovate at the LED bulb level. Are you making the job too easy for the manufacturer of the fixtures that house your bulbs?
MT: You can never make a customer's job too easy.
This post was originally published on Smartplanet.com