Organic light forms: Coming soon to a small screen near you

Henry J. Holcomb
The Philadelphia Inquirer
Universal Display Corp. engineers Sokhanno Mao, left, and Sokkom Suy use microscopes to examine a transparent and top-emitting Organic Light Emitting Device panels in the Class 100 clean Room, January 19, 2007 at UDC in Ewing, New Jersey. The company has emerged as a leading developer of technology that could improve cell phones, laptop computers and television sets. (David M. Warren/Philadelphia Inquirer/MCT)

PHILADELPHIA - After a dozen years of trial and error, a New Jersey company run by a couple of guys who live in the Philadelphia area has emerged as a leading developer of technology that could improve cell phones, laptop computers and television sets.

Later, this technology could be used to illuminate homes and offices, using less energy.

Universal Display Corp. also has developed methods to display text and moving pictures on a durable flexible material that in the future could be rolled up in a pocketsize tube with a tiny radio receiver. This could change the way people read newspapers or give soldiers in battle up-to-the-minute maps and intelligence photographs.

Flat liquid crystal display technology, or LCDs, have developed more rapidly and are now in use on laptop computers, telephones and television sets. Universal Display's organic light-emitting diode, or OLED, technology offers, its developers say, less costly, more beautiful, brighter and sharper images. And it uses much less energy, allowing tiny devices to run longer between battery charges.

The story of how the Ewing, N.J., company has developed ways to create light - by applying electricity through an active matrix to thinner-than-hair layers of molecules - offers a window into the high-risk world of turning ideas into commercial products.

For all its scientific advances, Universal Display, whose shares are traded on the Nasdaq Stock Market, has not turned a profit. It has lost about $125 million since its founding in 1994. Its shares have traded between $9.25 and $16.36 over the last 52 weeks, closing Tuesday at $13.98, up 52 cents.

Still, its top executives say they are full of confidence that the company is on the road to becoming the kind of success that might help sell the Philadelphia region as a place where 88 colleges and universities can work with entrepreneurs to create economic growth.

Sidney D. Rosenblatt, 59, the firm's executive vice president and chief financial officer, acknowledges that money raised from stock offerings and research grants and contracts have kept the company going while it has run up the big losses, but he believes financial rewards are just ahead: "When we start getting license fees, our margins will be 94 percent."

This year, South Korea's Samsung SDI Co. Ltd. will begin delivering large quantities of cell phones using Universal Display's technology worldwide. Sony Corp., which has been working with Universal Display for five years, introduced a 27-inch high-definition OLED television set last month at the Consumer Electronics Show.

Universal Display got its start when chairman Sherwin I. Seligsohn, now 71, a veteran entrepreneur, envisioned the tiny display screens of today's cell phones - long before the technology existed to make them possible.

Seligsohn and his key executives were part of an earlier wireless company, now called InterDigital Communications Corp., which developed promising patented technology.

In the early 1990s, Seligsohn visited Princeton University looking for research projects that might make tiny durable displays possible.

"Sherwin started funding research in my lab," professor Mark R. Thompson recalled recently. Thompson has moved to the University of Southern California, but continues to work actively with Universal Display.

Stephen R. Forrest, a colleague at Princeton who has since moved to the University of Michigan, joined the project. An electrical engineer, he had been working since 1982 on the electronic properties of organic materials, as he put it last week, "trying to understand the fundamental physics of organic material."

Eastman Kodak Co. first reported work on OLEDs in a 1987 paper and is now a rival to Universal Display. At the time Kodak's initial paper was published, the work of Thompson and Forrest was in its infancy. They had developed ways to produce light by applying electricity to organic material. But the material was soon destroyed.

Still, Forrest said, "Sherwin liked our ideas. He took a big risk. He spent a lot of money and told us to do more research and make this happen."

After several years and many failures, Universal Display focused on phosphorescent compounds, which it says are two to four times more efficient than rival OLED technologies.

The technology, the company Web site explains, "typically consists of a series of organic thin films sandwiched between two thin-film conductive electrodes."

Universal Display now employs 65 people, most with advanced degrees, and provides funding for 45 researchers at universities. In 1999, it built its own laboratories and, in 2005, added a small manufacturing facility to prove that its inventions work. It has no plans to manufacture products. Instead it will license its technology to companies around the world.

So Universal Display, said its president, Steven V. Abramson, 55, will remain focused on innovation, a place where everybody works together, each looking at a problem from a different viewpoint and willing to challenge the others. "We don't use titles or have reserved parking spaces. ... We have people from 15 different countries," Abramson said.

While most companies locate where the CEO wants to live, Universal Display chose Ewing, where its staff preferred. Abramson makes the long commute from Lower Merion; Rosenblatt from Haverford.

It "takes care to hire people who fit the culture, who understand that it is not a failure to fail. We have to be able to turn failure into opportunity and be a very inquisitive group. When something doesn't work, we want to know why," said vice president Janice K. Mahon, a chemical engineer with a master's of business administration from Harvard University.

The Philadelphia region has worked well for Universal Display. But despite its concentration of colleges, the region has not approached technology centers like San Francisco, San Diego, Boston and Raleigh-Durham, N.C., in making academe an engine of economic growth.

Catching up has become a top priority for the CEO Council for Growth, a unit of the Greater Philadelphia Chamber of Commerce, said Russel E. Kaufman, chief executive officer of the Wistar Institute and a council leader.

Kaufman and others are listening to companies like Universal Display, identifying prospects and putting together resources to convince them that they, too, can grow here.

Meanwhile, "this is a very important year" for Universal Display, its CFO Rosenblatt said. It has customers and patents in the world's major countries, and the first consumer products using its technology are coming to market.

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