The Future of eReaders


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Jenn Vail, Senior Marketing Manager, E Ink

E Ink is the world’s largest supplier of electronic paper displays (EPD) into the eReader market. Our low power, paper-like displays can be found in the Amazon Kindle, Barnes & Noble Nook, Kobo eReader and Sony eReader. As the eReader market has matured, we have worked with our customers to add new functionalities to the devices to make the user experience more robust. We continue to develop improvements in our core technology and in the ecosystem supporting eReaders to bring new features to users. In this session we will discuss future technologies that company is developing, and where we see the future of eReaders.

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  • Intro – from perspective of the future of eBooks & eReaders from a HW manufacturer – spend a lot of time looking at the market, trends and ecosystem as the success of both of those are critical to the success of our device. Similar to the iPod – it wasn’t the first mp3 player – it was just the first that integrated the content model successful. Without the content, the device couldn’t take off – without the device, the medium of electronic music couldn’t take off. I’ve started at E ink in 2000, so I’ve seen the company grow from dream, to reality. I went to school for communications / english – spent my high school working at the local library and wanted to be in publishing – and now I am, but from the other side 
  • So what do we do? We make electronic paper many of you are familiar with E Ink? how many are familiar with the kindle? Then you know who we are– we make the displays in the Kindle, Nook, Sony & Kobo – in fact, we make the displays is 90+% of the ereaders on the market today. the display industry classifies us as a reflective, high contrast display and they call it electronic paper displays, or EPD
  • To step back a little, we were founded in 1998 as a spin out of the MIT media labAnd I 2009 we were Acquired by largest customer PVI & the Company renamed “E Ink Holdings” - We now have a worldwide presence spanning EPD & LCD production – over 5k employees . Of those, about 300-350 are in the US, and all of our core technology - electronic ink is manufactured and coated in MA before being shipped to china for final assembly
  • But how did it all start? As they always do – from a dream – in this case, our founder’s dream was information anytime / anywhere – beach story- how can I bring the library to my beach chair?And Don’t forget – prior to tablets & smartphonesDream of content anywhere, anytime - Don’t need plugs, can read outside
  • And how was he going to realize this dream? By improving on something that had already come out of the xerox labs – elecgtronic ink – ink that contains a charge and therefore can be manipulated and updated - he had novel ideas on how to manufacture it to address the known issues; worked in his labs to improve upon it, worked to develop a business plan around it – describe how it works
  • Great thing about this is that we can coat it in a a roll, and leverage existing manufacturing processes; Theoretically no barrier to size of display; limitations are due to electronics, or TFTs
  • There are 4 core attributes of our technology which made it ideal for ereaders.First – paper-like. It leverages what your eyes already link – the appearance of paper.Ink and paper pigments similar; contrast ratio similar to newsprint, or paperback book;
  • Loves the sunReflective display – means it leverages the ambient light around you – the brighter it is, the better the display looks
  • This reflectivity also gives us another key benefit – a wide viewing angle. Like paper – extremely useful for sigange, and for reading. It’s not angle dependant, like an LCD that you twist around to find the best angle – it has a near 180 range.
  • iPadvs KindleThis enables designers to create lighter weight devices as the battery can be that much smallerBistability & backlighting
  • So again, these atributes were key for taking ereaders from imagination to reality
  • To step back, when we were founded, the ereader market didn’t exist. Some people were reading ebooks on computers, but there were no tablets, laptops were heavy, low on battery life, with lower color saturation and contrast ratio than the LCDs of today. Some early adopters were using the very first LCD based ereaders, but This was prior to drastic drop in LCD pricing, so devices were not cheap, had mostly green and black displays, were very heavy and had low battery life. As we worked on the technology, one of our first customers, sony, also had our vision of information anywhere anytime, and they worked closely with us on the first EPD ereader.
  • and in 2004, sony launched the first EPD ereader, the librie, in japanAnd while it wasn’t a huge success, it did spark the imagination of other device makers
  • And in ‘07, the kindle came along – it offered 3G, with a robust content store, and Customers were familiar with storeTrusted amazon to deliver what they wanted, when they wanted - FREE wirelessFirst gen sold slowly – but 2nd gen came out and was featured on oprah, and the market exploded
  • eReaders defined as dedicated reading devices (as opposed to Tablet, with varying programs)90% market share
  • Talk online about “death of eink” – I’ll get to more on that later, but customers have launched several new products this year, including new devices from the leading 4; continue to expand into new markets; Tetr released Oct; Amazon in Sept; Kobo in Sept; Nook and Sony in May
  • 2 Key Market drivers for growth- increase in large channel distribution markets – the products are truly going mainstreamRecognized value of epaper – companies are tier-ing products based on funtionalityChairman Yingjian Liu during a keynote speech at Computex 2010,  discussed the increasing popularity and evolution of the e-book reader. He proclaimed the strengths of the e-ink format and how his company was leading the way in his home country of China.  Then, his declarations got very bold. He called the e-book reader the “fourth screen,” referring to TV, PC, and cell phone as the other three screens.Note Border’s apparent strategy: Best: Sony Readers (pocket and touch versions) à $170 to $250 Better: Kobo à $150 Good: LCD à $120 consumer reports     “Buy the iPad for e-books only if you’re willing to compromise to get a multifunction device”
  • What are the reasons for this?These slides are from Kristineparcell of pew research “Books or Nooks? How Americans’ reading habits are shifting in a digital worldInteresting thing – computers have been around for decades, and this is the established technology for many early adopters of ebooks– ereaders have been out for about 6-7 years, and they’ve already caught upIn constrast, although tablets have the same numbers in the market, people do not ready on them nearly as much as they do a dedicated device
  • In addition, of those who own of each devices, (so some overlap) peopleread on their ereader the greatest percentage of time, with tablets coming in second; we don’t know what kinds of ebooks people are reading on the respective devices, but based upon our own learnings, I suspect most of the tablets are being used for business reading
  • Those using an ereader read MORE than any those who use other devices; 61% of ereader users read every day, or a few times a week, vs 44% on a tablet, 19% on a computer and 11% on a cellphone
  • So what are the key learnings? We know people read for a variety of reasons; this is the theme cloud Pew Research put together on that theme. We can see from the research, that the market for the device is growing, people are reading more with dedicated devices, and they are more likely to be a purchaser of content as opposed to a borrower. Pew did an excellent study of ebooks and the library and I encourage you to take a read – there is some facinating information in it.
  • So what’s next? How do we take these learnings about increased reading habits, and the preference for a dedicated device?
  • The education market - Its huge, and growing – especially outside the ‘industrialized’ nations.
  • We see huge opporunities for etextbooks… why? Well, we know that people prefer to use these devices for reading & users actually read more. Aside from the enticement, imagine the benefits 1 single device can bring to the weight of a students backpack - now that student can carry all of their classbooks in one hand. eReaders using our technology in this size are significantly lighter weight than their tablet counterparts; Teachers can customize plans to take advantage of real time updates to information - Most importantly, distractions in the class room can be limited – unlike a tablet, where students can play games, surf the net, spend time on social media, a dedicated tablet device can cut off from those distractions
  • But this isn’t just an issue about the weight of a bag – this is also an issue about access to information – and in developing countries, where textbooks are in short supply (mention Sri in his class sharing 1 engineering book); worldreader is already in the field, providing Kindles to students – and it is making a differenceThere is a cost to the device, but licenses for digital material are cheaper than paper books, and more importantly, you don’t need to worry about the logistics of getting the book to the classroom – it can be a wireless transaction – immediate and without the need for heavy trucking
  • So, to test out what we have been learning about the market, and test our own theories, we reviewed studies of school using eReaders in the classroom, and then we did our own small test in a local school, comprised of about 300 5 & 7 graders over 2.5 months with nooks and kindles. Students were using the devices for their reading assignments, but not using actual extextbooks – they were allowed to use them for pleasure reading as well. So what did we learn?
  • Did a study in a school near our factory - Study isn’t released yet, but there are a couple interesting points that I thought I would shareWe are undergoing a longer test with that school
  • Did a study in a school near our factory - Study isn’t released yet, but there are a couple interesting points that I thought I would shareWe are undergoing a longer test with that school This enforced our belief that a dedicated devices, with a robust support ecosystem would be exrtremely valuable
  • Just a word on content accessibility – as this was the #1 complaint of students and teachers.
  • This is the process for borrowing anebook from the library – again, the book, not the device.This is the same process the students needed to use at their school with the ereaders we provided, since they were only “borrowing” content
  • There are many other studies out there – these are just a few. But the information is very interesting to read.
  • So now we can talk a bit about the differences between tablets and dedicated ereaders – some talk of tablets vseaeaders - Go through points We are able to supply LCD or EPD depending on the application, we believe that LCD is best suited for tablets, laptops, mobile phones and TV whereas EPD is suited for reading applications – evaluate your useage, and then mamke a decision – and with pricing today, we find that many people have both – different devices for different purposes – tell story of airplane
  • But, 1 crfitisim of our displays vs LCD is the color saturation… To lower the gap between the 2 types of devices, we are continuing to make improvementsOne of those areas is color – we do have a product in the market, and are continuing to make improvements in color saturation, and contrast ratioAgain – reflective display – reason LCDs look better is due to strong backlight; even when apply a front light, we are still lower power due to driving methods
  • Working on higher res screens to support detailed charts, schematics, maps
  • We feel all of these new features combined could take the eTextbook to the next level.Good news is that there are a few companies exploring thie area of dedicated EPDeTextbooks – our customer Ectaco is one of them, who has the first color E Ink eTextbook on the market – they have a lot of education experience through other products
  • I’d like to mention that e ink is not just in ereaders, but can be found in a variety of other applications, such as cell phones, watches, smartcards – apps that require low power, small display areas
  • The Future of eReaders

    1. 1. The Future of eReadersJenn VailSenior Marketing Manager
    2. 2. Safe Harbor StatementStatements in this presentation that are not strictly historical, including the statements regarding themarket, economy, the Company’s ePaper, LCD and other business, the Company’s future product launches, theCompany’s positioning and expectations for 2012 and future periods, and any other statements regarding eventsor developments that we believe or anticipate will or may occur in the future, may be "forward-looking"statements within the meaning of the securities laws in Taiwan. There are a number of important factors thatcould cause actual events to differ materially from those suggested or indicated by such forward-lookingstatements and you should not place undue reliance on any such forward-looking statements. These factorsinclude, among other things, the uncertainty in the economy, contractions or growth rates and cyclicality ofmarkets we serve, competition, our ability to develop and successfully market new products and technologies andexpand into new markets, our ability to successfully identify, consummate and integrate appropriateacquisitions, contingent liabilities relating to acquisitions, risks relating to potential impairment of goodwill andother long-lived assets, currency exchange rates, our compliance with applicable laws and regulations andchanges in applicable laws and regulations, tax audits and changes in our tax rate and income taxliabilities, litigation and other contingent liabilities including intellectual property and environmentalmatters, risks relating to product defects and recalls, the impact of our debt obligations on our operations, rawmaterial costs, our ability to adjust purchases and manufacturing capacity to reflect market conditions, legislativereforms and other changes in industry, labor matters, our relationships with and the performance of ourcustomers and partners, risks relating to man-made and natural disasters, our ability to achieve projected costreductions and growth, and international economic, political, legal and business factors. These forward-lookingstatements speak only as of the date of this presentation and the Company does not assume any obligation toupdate or revise any forward-looking statement, whether as a result of new information, future events anddevelopments or otherwise.
    3. 3. Electronic Paper Displays
    4. 4. Founded 1998, MIT Media Lab Acquired by largest customer, PVI, in 2009 Company renamed to E Ink Holdings
    5. 5. The Vision
    6. 6. Roll to Roll Manufacturing
    7. 7. 2 Product Lines
    8. 8. Paper Like– Made from bits of ink and paper
    9. 9. Sunlight Readable– No shade required
    10. 10. Wide Viewing Angle– See it fast from every angle
    11. 11. Low Power12” LCD for 20 hrs = 36 E Ink = 1 2.5 pounds 1 ounce! – Leave the power cord behind
    12. 12. E Ink & eReaders1935 Everyday Science & Mechanics 2012 – My Deck
    13. 13. Birth of the eReader 1948“Electronic book” Space Cadet A. Heinlein 1971 Project Gutenberg Michael Hart Kindle Spotlight Proposed Dynabook Jeff Bezos and Oprah notebook computer October 29, 2008 1980 1990 1998 2004 2007 2008 2012 TRS80 III (1980) $2495 12” B/W CRT 48k max RAM Dual 5.25” 178k floppies DOS 2012 Nook GlowLight 2004 1951 > 7 oz Sony LibriéFirst computers 1998 Laptop 30 day battery life 10 MB memorysold commercially 4 hr battery life 60 days w/out light Japan 1000 book memory SD card slot 2007 Amazon Kindle Compaq Portable PC (1985) 7 days battery life >$3000 1999 10.3 oz 12” monochrome CRT (green/black) Franklin Rocket eBook 200 book memory 20mb hard drive (card) 5.5 in LCD106 dpi Free connectivity Dual 5.25” 360k floppies 20 hr battery life Access to 800k books DOS
    14. 14. First eReader Launched 2004 Sony Librie • Japan launch • Publishing consortium • Low volumes • Content availability issues
    15. 15. Next Generation - 2007 Amazon Kindle • 1st device launched by Amazon • Content model worked • 3G service
    16. 16. 2012 - World’s Leader in EPD for eReaders
    17. 17. New Releases
    18. 18. Total ePaper Display Market Forecast• EPD displays are continuing to grow at a significant rate• E Ink is shipping >97% of all production ePaper displays 2000 12000 10000 1500 8000 Revenue Units 1000 6000 4000 500 2000 0 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Total Units(M) 19 22 59 115 211 366 583 782 1039 1378 1833 Total Revenue($M) 129 431 1095 1710 2395 3623 4854 5945 7082 8251 9616 Source: DisplaySearch 2009 E-Paper Displays Report
    19. 19. Rise of eReading Devices – Pew Research
    20. 20. 2012 Pew Research
    21. 21. 2012 Pew Research
    22. 22. 2012 Pew Research eReaders = 61% Tablet = 44% Cell phone = 13% Desktop/laptop = 18%
    23. 23. 2012 Pew Research
    24. 24. What’s Next?
    25. 25. WW Secondary & Post Secondary Student Population 54.7M 241M 43.6M 43.9M 70.6M 4M Source: UNESCO ISCED 2009 Estimates
    26. 26. eTextbooks: The Future of EducationCarry a library’s worth of textbooks in your hand.Teachers / students can customize learning experience.Distraction elements can be controlled.
    27. 27. Revolutionizing EducationSources: Room to Read,, David Risher
    28. 28. Students and eReaders
    29. 29. In School eReader Pilot• 1/4 of students stated their interest in reading increased.• 1/3 of parents believe their child’s interest in reading increased.• ½ of the students rated the E Ink screen better than standard LCD screens in terms of overall performance for all usage occasions, outdoors, indoors and on-the-go• More than ¾ of the parents felt that it was advantages that the eReader had no access to email, texting and browsing.• Close to ½ of the students felt that the E Ink experience was like reading a paper book.• Students, teachers & parents like the portability of the devices – made reading on the go easier
    30. 30. Issues• Device not optimized for school setting• Inability to register many devices on one account• Lack of hardware support for a school program• Teachers inexperienced with the technology• Complex download process *• Limited licenses for content• Few textbooks, mostly literatureLeisure reading devices have challenges in class setting
    31. 31. Purchasing an eBook from Online BookstoreSearch Download viaStore Purchase title WiFi Customer owns the title.
    32. 32. Accessing an eBook from a Public Library Checked out – place hold KindleSearch Download UnlesseBook via WiFi Penguin, via USBCatalog Available – checkout in EPUB,PDF eReader Open in Adobe Kindle, PDF, EPU download to Digital Editions Transfer to B computer device via USB Download to Tablet Open app tablet Library leases the title & allows users to read through Digital Rights Management.
    33. 33. Additional Studies• Clearwater Schools• Brooklyn Tech• Miami Dade County• Southern Onondaga & Madison County, NY• Worldreader
    34. 34. Consider the Use-Case Casual Tablet User Education: Student Use• Web browsing and email • Content “always on”• Video entertainment • Rough handled like a book or notepad• Gaming • Month between charging• Edu-tainment • Readable in high ambient • Moderate interactivity• Light reading – i.e. note taking, navigation, typing• Heavy interactivity • Focused activity: Single-tasking• Multi-tasking
    35. 35. E Ink Triton Color ePaper
    36. 36. Flexible Displays
    37. 37. Higher Resolution • High resolution (300dpi) for in depth charts & drawings • Touch / Pen input • Fast response
    38. 38. Animation Now !E Ink Pearl Display; Thank you Freescale!
    39. 39. eTextbooks – a Reference Library in Your Hand • Ectaco JetBook • Dedicated eTextbook device • Pilot study at Brooklyn Tech • Color EPD • Ability to “lock” access to email, web, social
    40. 40. Non-eReader Products
    41. 41. Thank Source: NYT