October 8, 2014: Apple says it is “surprised” after GT Advanced Technologies, the supplier rumored to be manufacturing ultra-strong sapphire glass displays for the new iPhone 6, says it will file for bankruptcy.
The announcement appears to mark the end of the road for sapphire glass iPhone screens, a highly anticipated upgrade that promised to make devices more durable.
GT Advanced Technologies, the company that was supposed to make sapphire screens for the iPhone early this decade, has been charged with misleading investors by the SEC.
The SEC’s investigation found that GT and its CEO violated antifraud provisions of the federal securities laws as part of its deal to supply Apple with sapphire. After failing to meet certain performance requirements, GT caused “significant investor harm” by reclassifying over $300 million in debt to Apple. Sadly, the company’s punishment is pretty much just a slap on the wrist.
Apple is very secretive about its data centers. For good reason: They’re at risk from criminals, foreign spy agencies, terrorists and more. But the company gave a local newspaper a look inside its Arizona server farm.
This 1.3 million-square-foot facility in Mesa houses Apple’s global data command center.
We may not yet have sapphire glass on our iPhone screens, but Apple has been claiming to use the ultra-hard material for its iPhone camera lens since 2013’s iPhone 5s.
However, those claims are being called into question by a new durability test carried out by YouTuber JerryRigEverything, who compares the hardness of the iPhone 7 camera lens with the sapphire display of a Tissot sapphire watch — and finds that the iPhone camera lens scratches far more easily.
GT Advanced Technologies — a.k.a. the disastrous sapphire supplier which was hired by Apple to build iPhone displays, before collapsing into bankruptcy — has announced that it has reemerged from Chapter 11 as a newly-reorganized company with a “solid balance sheet,” and “renewed strategy focused on growth in the solar and sapphire industries.”
In the lead-up to the iPhone 6, everyone expected Apple to give it a sapphire glass display. Sapphire glass, it was said, would lead to nigh-indestructible screens: Scratched and shattered iPhone displays would become a thing of the past.
Of course, we all know what happened from there. Apple’s sapphire partner, GT Advanced Technologies, completely collapsed, and the iPhone 6 shipped with plain old Gorilla Glass. Yet even if it hadn’t, Apple might not have used sapphire glass, which was much more reflective and harder to read in ambient light than Gorilla Glass.
But here’s the key word: was. A new technology has emerged that might make sapphire glass every bit as good when it comes to viewability as Gorilla Glass.
The fate of GT Advanced Technologies’ failed sapphire plant in Mesa, Arizona, has been decided. After committing to repurposing the 1.3-million-square-foot facility, Apple revealed today that it will invest $2 billion in making it a global command center for all of its cloud networks.
The company plans to have 150 full-time employees based in Mesa to operate the center once it’s built, and there will be an accompanying solar farm to power the facility with 100% renewable energy.
GT Advanced Technologies’ attempts to make sapphire iPhone screens for Apple may have ended in disaster, but that’s not stopping GT senior execs from asking for millions to be paid out in bonuses.
Because the company filed for bankruptcy protection back in October, any bonus program needs to have the signature of a judge in order to be legally binding. GT is requesting a hearing in January, although it admits there is likely to be opposition.
The bonus program would cover 9 unidentified senior executives, and could add up to $2.275 million if all the necessary targets are hit. A second bonus proposal would pay a total of $1.4 million to an additional 28 people.
Corning’s relationship with Apple looked doomed earlier this year. Having manufactured the touchscreens for every iPhone since 2007, the Gorilla Glass bosses were all but sure they were being ditched in favor of synthetic sapphire crystal, set to be supplied by Apple’s hot new partner, GT Advanced Technologies.
But while Apple’s affair with GT has imploded spectacularly, Corning is back on Cupertino’s crush list after stepping in at the eleventh hour to create super-sized displays for the iPhone 6 and 6 Plus. Now Corning is convinced its latest technological advance — Gorilla Glass 4, its toughest version yet — will banish sapphire suitors for the immediate future.
“Sapphire is a really, really nice material that’s very good for reducing scratches,” Dave Velasquez, Corning’s director of marketing and commercial ops, told Cult of Mac. “However, we feel very strongly that glass is the best material for touch panel cover glass. When you weigh up everything from cost to drop-testing, to the amount of energy that’s needed to make it, in our opinion Gorilla Glass is clearly the best material to use.”
Now photos published by the Wall Street Journal show some of GTAT’s sapphire errors, made just days before Apple signed a deal for the company to produce sapphire displays to be used in next generation iPhones. The 578 pound sapphire cylinders — known as boules — featured multiple flaws, which rendered the majority unusable.
While Apple certainly pushes its manufacturers hard to seemingly achieve the impossible on tighter and tighter profit margins, the picture that emerges from the WSJ article is of GT as a chaotic company, struggling from the very start to fulfil Apple’s expectations.
Apple’s sapphire ambitions with GT Advanced Technology have been a complete disaster. But even though the plan to turn Mesa, Arizona, into the Sapphire Capital of the West failed, Apple executives are still looking for a way to repurpose GT’s new factory.
The city of Mesa and Arizona Gov. Jan Brewer bent over backward to bring Apple to the Grand Canyon State, but now that GTAT plans to shut down operations, Apple says it’s still committed to helping the area.
The start of any innovative business should be identifying a service that the current market leader in the sector is not supplying.
With Apple’s failure to provide sapphire displays for its latest iPhones — thanks to the spectacular collapse of now-bankrupt supplier GT Advanced Technologies — you’d think that other smartphone makers would be climbing over one another to bring sapphire-enhanced smartphones to market; demonstrating that they can do what Tim Cook and his billions of dollars weren’t able to.
Which is why it’s something of a surprise (or perhaps not!) to hear that Apple’s troubles with sapphire displays has pretty much discouraged other companies from trying the same thing.
Apple’s bankrupt sapphire supplier GT Advanced Technologies might have stayed quiet about its reasons for the bankruptcy, but a few details are nonetheless starting to emerge.
Two of the most intriguing tidbits concerning the case regard the cost of sapphire production for GT Advanced Technologies, and the financial penalties Apple imposes on any supplier who leaks information about future products.
With GT Advanced Technologies asking permission to close down its Arizona factory after less than a year, it’s a fair question to ask where exactly Apple plans to get the sapphire displays for its forthcoming Apple Watch.
Earlier this week, KGI analyst Ming-Chi Kuo said that the bankruptcy filing wouldn’t affect Apple’s forthcoming wearables debut. According to a new report from Digitimes, the reason for this is that Apple has a backup plan in the form of two other sapphire cover suppliers besides GT Advanced: the South Korea-based Hansol Technics and China-based Harbin Aurora Optoelectronics Technology.
GT Advanced Technologies is apparently getting out of the sapphire production game, after filing for Chapter 11 bankruptcy protection at the start of this week.
As reported by Re/code and the Wall Street Journal, the beleaguered company is asking the court’s permission to “wind down” operations at its sapphire manufacturing plant in Arizona — and, yes, for those keep track, that does come less than one year after the company first announced its game-changing deal with Apple.
How GT Advanced Technologies could have filed for bankruptcy, despite Apple’s best efforts to prop it up, is still something of a mystery — and it’ll stay like that if the company gets its way.
According to a Reuters report, GT Advanced has requested that the New Hampshire bankruptcy court currently overseeing its case put the kibosh on releasing key documents related to a “third party,” claiming that this would allow it avoid paying damages thanks to confidentiality agreements.
Apple’s plan to put sapphire glass in everything took a tumble this week when its exclusive supplier GT Advanced Technologies filed for bankruptcy, and according to Apple’s spokesman, they were just as shocked as all of us.
In a statement issued this morning to Reuters, the Apple spokesman Chris Gaither said the company was ‘surprised’ by GT’s decision to file for Chapter 11 bankruptcy, but they haven’t given up on its AZ plant yet.
New details have emerged about the surprise bankruptcy protection filing of GT Advanced Technologies, a.k.a. the company that was supplying Apple with its sapphire.
As per the Wall Street Journal, Apple agreed to lend GT Advanced a total of $578 million to help get its large sapphire factory in Arizona up and running, only for Cupertino to withhold the final $139 million payment it was due to make, for reasons which aren’t yet clear, but likely relate to the company’s failure to deliver sapphire to Apple’s satisfaction.
The idea that the iPhone 6 and 6 Plus would have a sapphire display was one of the most widely reported errors leading up to the unveiling of Apple’s next gen iPhones.
But while plenty of time was spent discussing the possibility, very few people made any money through the speculation — except for Tom Gutierrez, CEO of sapphire manufacturer GT Advanced Technologies, which just filed for bankruptcy protection.
According to the Wall Street Journal, one day before Apple revealed its new iPhones wouldn’t feature sapphire screens after all, the boss of the struggling company cashed in more than 9,000 shares of GT stock for an average price of $17.38 — bringing in a total of $160,000.
Since February this year, Gutierrez has sold close to 700,000 shares in his company, valued at more than $10 million.
GT Advanced Technologies, a sapphire supplier that works closely with Apple, today confirmed that it has filed for Chapter 11 bankruptcy court protection. Its share price has been falling since it was revealed that Apple opted for Gorilla Glass rather than sapphire for its iPhone 6 displays, but GT insists it’s not going out of business.
One of the biggest disappointments from Apple’s announcements yesterday was the lack of a sapphire screen for the iPhone 6. A seemingly-neverending string of part leaks and rumors indicated that 2014 would be the year the iPhone got a nearly indestructible sapphire display cover.
And while sapphire is used for the Apple Watch’s display, Apple made no mention of sapphire for the iPhone 6 or 6 Plus.
The uncertainty about iPhone 6 availability this fall is largely centered around one component: sapphire. The ultra-durable material is rumored to be in not only two new iPhone models this fall, but the iWatch as well.
Apple’s only sapphire partner is GT Advanced Technologies with a relatively small operation in Arizona. According to another report, GTAT’s sapphire production, particularly for the 5.5-inch iPhone 6, will he heavily constrained until 2015.
The official iPhone 6 unveiling is less than four weeks away, but according a Wall Street Journal report, Apple is still debating whether it should limit its new Sapphire crystal displays to only the high-end models.
Production of Sapphire screens at Apple’s factory in Mesa is nearly up and running, and will produce twice as much sapphire as the current global output, but the company is still struggling to get enough material for the fall launch of the 4.7-inch and 5.5-inch iPhone 6s this fall and might only add it to the most expensive models.
Apple has been struggling to produce enough sapphire displays in time for the iPhone 6, but after going straight to the source of the freakishly indestructible glass – GT Advanced Technologies – MIT has learned of the company’s plans to use a giant machine that may solve all of Apple’s sapphire production problems, one slice of sapphire at a time.
The problem with sapphire glass is that while amazingly durable, it’s also ridiculously hard to produce in thin smartphone sized sheets. Apple’s current production methods involve taking a large chunk of sapphire and sawing it down to just a few hundred micrometers thick. It’s time consuming and wasteful, but GT’s new Hyperion 4 Ion Implanter technology could allow it to make paper thin sheets of pure crystal sapphire glass just by bombarding it with hydrogen ions.