Agreed 100% FJ, you hit the nail on the head.

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People must realise that if you're engaging foundries into producing proprietary GaAs-Epi, there's someone lined up for those chips. No foundry would ever agree to this added product line and costs associated with it just because, IMO. At the moment PTI buys standard GaAs wafers and processes them with a Molecular Beam Epitaxy machine with their proprietary process, then they send those wafers to BAE. This process is needed for BAE to use these wafers in their fabs. These machines are "cheap", costing around 1 million dollars, however, Geoff told me very few fabs have them, it's a very niche machine in the way they use it. But the process of layer depositing itself is unique to POET. Without the recipe to input in the MBE machine, one can't produce PET or POET chips even if they had the PET recipe for example.

We should be able to process enough wafers at the moment for R&D in my mind. So what does this all mean? Our MBE machines can no longer process enough wafers to meet demand. This is leading me to think that customers are seriously asking to manufacture chips using the POET process and we need a higher volume of POET GaAs-Epi wafers, either for high volume R&D or actually manufacturing of chips under the POET process. Either way, we should be seeing NRE revenue in Sept-Nov in my mind. With the VCSEL announcement today, I'd venture to guess someone wants to make VCSEL chips with these wafers. Much less time to market for a fibre optic data transmission chip, 3D imaging or gesture recognition VCSEL chip, then say a 40nm Iphone chip.. Way less IP going into a VCSEL chip.

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"The Company already has a large inventory of key and ancillary patents protecting its unique platform for monolithic fabrication of integrated circuit devices containing both electronic and optical elements on a single semiconductor wafer."

fairchij1

https://www.youtube.com/watch?v=vt5g9bxypMM

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Upgraded Molecular Beam Epitaxy (MBE)

The MBE system is a key piece of process equipment on the POET pilot line. Earlier this year, the Company announced that there was a requirement for the MBE system to be taken off-line for maintenance, as well as for source material replenishment and a major upgrade. In anticipation of this, we had used the MBE to produce all material required for the 100-nm initiative, ahead of the scheduled outage.

As anticipated, the upgrade work required a total of two months of off-line work. This scheduled work is now completed, and the MBE system is back in service, growing wafers for use in further POET device work.

Dr. Geoff Taylor, Chief Scientist of the Company, noted, “With the old MBE system, we had demonstrated the short wavelength optical capabilities of our process, mainly for datacenter applications. With our newlyupgraded MBE system, our capabilities have expanded to fabricating optical devices with long wavelengths. This is critical for our POET offerings in the long-haul, networking and optical equipment market.”

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In accordance with its planned maintenance scheduled for the POET facility, the Company has completed its most recent wafer growth cycle.

In association with this, POET is upgrading its molecular beam epitaxy (MBE) system to make critical additions and replenish source materials. One critical addition is a high-volume indium (In) source to enable metamorphic growth on a gallium arsenide (GaAs) substrate of the POET epitaxy with a natural wavelength of 1550-nm. This is expected to enable the production of long-wavelength lasers combined with high In-content field-effect transistor (FET) channels for superior high-speed transistor performance.