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  1 Or, more formally, Royal Philips Electronics NV. Dutch companies of sufficient preeminence and seniority are awarded the honorific Koninklijk, literally “Kingly”; NV stands for Naamloze Vennootschap, “nameless partnership,” meaning publicly owned. For simplicity’s sake, this book uses the abbreviated form, Philips.

  In his new role at Philips Lighting one of the first items that caught Begemann’s eye was an advertisement in a trade journal for a new, “fourth-generation” light emitting diode, a device that emitted bright amber light. And this was of interest because, as Begemann knew well, one of Philips best-selling products also emitted bright amber light: highpressure sodium-vapor street lamps. City planners favored sodium lamps because, in the wake of the oil shocks of the 1970s, they were more energyefficient - hence much cheaper to run - than the conventional mercuryvapor technology. But many residents disliked the sulphurous yellow glare the lamps gave off. It obliterated other colors, turning streets into stalags, like scenes out of Dante’s Inferno. Nonetheless, though ugly, highpressure sodium-vapor lamps were ubiquitous. In the UK, for example, they accounted for around 85 percent of street lighting.

  Begemann saw that street lights based on LEDs would consume much less energy than sodium-vapor lights. He also recognized that light emitting diodes would have another advantage over conventional sources. Unlike bulbs, which waste a lot of their output shining upwards and sideways, LEDs were directional, shining only where pointed, in this case, downwards. This meant that, in order to achieve the required illumination at street level, you would not need to produce so much light. Begemann ordered some of the new bright orange LEDs. He got the engineers at his lab to rig up a demo. They soldered a couple of hundred of the devices onto a circuit board then hooked them up to an electric current. The tiny lights shone brightly. Not nearly enough to compete with sodium to be sure, but doubtless they would get brighter. LEDs were, after all, semiconductors. The more of them you made, the better (and cheaper) they became.

  2 LEDs, like most other light sources, are lambertian, meaning they shine equally in all directions. However, unlike bulbs, which emit light more or less spherically, LEDs emit only hemispherically.

  In 1993, seeking to share his findings with colleagues Begemann staged a strategic directions workshop. He understood from the outset that LED lighting was not going to be an easy sell. Only a few years previously, believing the technology a dead-end, Philips had disbanded its LED group and ignominiously exited the field. In 1992, a working group at the company investigating “unconventional light sources” had concluded that LEDs were not suited for general illumination. But in the interim the efficiency of LEDs had doubled, then doubled again. Perhaps it was time for another look? Begemann began his presentation with a cautionary tale. Imaging had long been dominated by Kodak, with its photochemical film. But the recent advent of digital cameras meant that the writing was on the wall for the venerable US firm. Light emitting diodes, he asserted, represented the same kind of existential threat in the lighting market. Admittedly, LEDs were as yet not capable of producing white light. But that was not the issue, Begemann argued, he fully expected that they would eventually acquire this capacity. (He was, as we shall see, absolutely right.) In the long term LEDs had the potential to radically change illumination. If Philips wanted to maintain its status as world leader in the lighting market, innovation was essential. For the moment, the important thing was to get cracking with the amber, then continue with the white when it became available. “LED lighting is something we need to look at,” he concluded.

  His message fell on deaf ears. “They didn’t really believe it,” Begemann told me. “Nobody said, Yes — that is something.” Fortunately, he still enjoyed the backing of his boss. Kloster had been disturbed by the presentation and its implications for the future of Philips Lighting. Perhaps Begemann had a point: in which case, what to do next? It was imperative to find out how much brighter amber LEDs would become. The best ones were made by Hewlett Packard. As it happened, one of Kloster’s close friends, a fellow Philips board member called Frank Carubba, had formerly been a senior manager at Hewlett Packard. Phone calls were made. It was arranged that in January 1994 Begemann would travel to San Jose in Silicon Valley to meet with executives at HP’s Optoelectronics Division, the source of the little orange lights.

  The visit did not go well. Begemann wanted to discuss the role that LEDs might play in lighting. What ensued was a failure to communicate: the HP guys simply didn’t get what he was talking about. For them, LEDs were indicators, not illuminators. But, though frustrated, Begemann stubbornly persisted. Back in Eindhoven, he kept pestering Hewlett Packard to send someone over to Holland so that he could show them what he meant. Eventually, in March 1994, keen to get the pesky Dutchman off his back, the division manager capitulated. Roland Haitz, the number-one technology guy, not just of the Optoelectronics Division but of HP’s entire Semiconductor Products Group, happened to be in Japan. Haitz was scheduled fly to his native Germany for a trade show. Would he mind dropping in on Philips in Holland on his way home? Reluctantly, Haitz agreed.

  To understand why Begemann had so much trouble convincing his colleagues, it helps to look back over the history of the LED. The visible light emitting diode was invented in 1962 by Nick Holonyak, a researcher then working at GE’s Advanced Semiconductor Laboratory in Syracuse, New York. It glowed a dull red. The tiny size of the device made the LED ideal for its first application, as an on/off indicator. With the advent of digital watches and calculators, LEDs were pressed into service as displays, to provide alphanumeric read-outs. Hewlett Packard got into LEDs because, as a major maker of test and measuring equipment like digital voltmeters and counters, read-outs were vital to its core business. The conventional display device was the Nixie. A gasfilled vacuum tube, it contained a stack of metal wires, bent into the shapes of the numbers from 0 to 9, which glowed when current was applied. Nixies were cumbersome, power hungry, hard to read, prone to breakdown and - worse still - an anachronistic embarrassment at a time when the rest of the electronics in HP’s products had shrunk into low-power transistors and chips. The capability of LEDs was thus closely aligned with HP’s corporate strategy. Roland Haitz had been responsible for many of the company’s early LED products. Among other innovations, he had helped develop a seven-segment single-digit LED display that was brighter and cheaper to manufacture than rival products.

  In 1970 Bill Hewlett committed his company to building a handheld scientific calculator, an electronic slide-rule that could fit in a shirt pocket. Since production was limited by how many displays HP could make, the company poured resources into the research, development, and manufacturing of LEDs. The calculator turned out to be a huge hit, selling in the millions, causing HP’s stock to double in value. “This was a big deal for HP,” Haitz recalled. “After that, Hewlett was so proud we had helped the company to get such a big success that we were the fair-haired boys for a long time to come.” HP continued to innovate in the materials from which LEDs are fabricated. In 1979 Haitz hired George Craford, a former student of Holonyak’s who had made the first yellow LED. The potential for LEDs to play a role in general illumination had been clear to Holonyak more or less from day one. “We believe there is a strong possibility of developing [the LED] as a practical white source,” he told an interviewer back in 1963. Holonyak and Craford continued bandy around the notion light emitting diodes as the shape of things to come in lighting. But most people simply laughed this off as utterly impractical. So long as LEDs could only glow dull red - back then no-one was much interested in Craford’s yellow - they would continue to be a niche market. LEDs were merely light to be seen, not light to see by, which is what Ton Begemann was proposing.

  Then, beginning in the mid eighties, the picture began to change. New light emitting compounds were investigated. For the first time an unfamiliar adjective began to be applied to describe the output of LEDs. At long last the tiny lights were becoming bright. From having been ha
rd to see, LEDs were becoming hard to look at. Serendipitously, a new application popped up for which bright red LEDs were a perfect fit. In 1985, to reduce rear-end collisions - one of the most common forms of road accident - the US National Highway Traffic Safety Administration required that thenceforth all automobiles must be equipped with a third brake light. This would be mounted at eye-level in the center of the rear windshield. Car companies initially responded with incandescent-bulb-based solutions. These were unsatisfactory. Bulbs were bulky and placed an extra burden on car batteries. Unlike LEDs they were not long-lived nor mechanically robust (resistant to shock and vibration). In addition, it turned out there was another, safety-related reason for adopting the new technology. LEDs were electronic: they lit up much faster than incandescents, giving the driver in the car behind precious extra milliseconds to brake.

  The first attempt, by a Japanese car lamp maker, to implement center high-mount stop lights with LEDs simply lined up 76 low-power devices in a row. Roland Haitz took one look and snorted, “This is an unnatural act!” That was not how it was done in the power transistor business. For a one-watt device you didn’t take a hundred ten-milliwatt transistors and wire them up in parallel. No, you just made a bigger chip and stuck it in a package that could handle the heat. “We have to do the same thing for LEDs,” Haitz urged HP’s engineers, sketching what such a package might look like. By maximizing the efficiency and minimizing the cost of manufacture, this design would beat the Japanese. Marketed under the brand-name Piranha, power LEDs would take the lion’s share of the market for automobile center high-mount stop lights.

  By the early 1990s it was clear that bright red LEDs would prevail in the brake light market. Armed with its new bright orange lights, Hewlett Packard was eyeing a related niche — automotive turn-signals. Then, in December 1993, came a bombshell. An obscure, previouslyunknown Japanese firm named Nichia announced that it had done what many of the biggest firms in the electronics industry had been trying, and failing, to do for the past two decades: namely, a bright blue LED. This was a major breakthrough. Overnight, the game had changed. With red, green, and blue LEDs, it would now be possible to make white light — as just a few months earlier, with remarkable prescience, Ton Begemann had anticipated. Roland Haitz had long prided himself on never having spent a single dollar on blue light emitting diode research. It was, in his view, “a black hole.” Now, within a couple of the weeks of the Japanese announcement, Haitz told his boss that HP urgently needed to set up a crash blue LED development program staffed by a team of PhDs plus technicians. Haitz himself took off for Japan to meet with Nichia. Which is where he was when the request for him to visit Philips Lighting arrived.

  “It was the most nerve-wracking trip I ever did,” was how Haitz remembered his late-evening drive through the Ruhr from Hanover to Holland. After three horrendous hours negotiating heavy traffic amid torrential rain, windshield wipers swishing away at top speed throughout the journey, he finally reached Eindhoven. Next morning Ton Begemann gave him a guided tour of Philips Lighting’s laboratory. It was a revelation for Haitz who until that point, as Begemann recalled with a chuckle, had known nothing about lighting. Haitz himself described his tour as an introduction to a completely different world. “I learned so much on that day about what counts in lighting,” he told me, “what’s important, what are the potentials, what are the issues.”

  In return, Begemann badgered Haitz for answers to his questions.

  3 In fact, there had been a blue LED project at HP’s Optoelectronics Division, but “that was where you went to be punished,” Bob Gardner, an engineer in the division, recalled. “Because everyone knew there would never be a bright blue LED, that was where you wore the dunce cap, just before you were shown the door.”

  The ef ficiency of HP’s amber LEDs had doubled twice in recent months. How much improvement in their output could be expected by the year 2000? Haitz was the ideal person to ask. In his role as chief technologist he was, like Begemann, accustomed to peering into the future. HP’s customers in the automotive industry were always eager to find out what was in the product pipeline. “What will you have in five years?” they would demand. “We have to know because it takes us six years to develop a car.” LEDs like the ones that had caught Begemann's eye were based on technology Hewlett Packard had commercialized two years previously and developed three years before that. Between what Haitz knew was in HP’s labs back in Silicon Valley and what Philips had acquired there was thus a five-year lag. In addition to which, he was able extrapolate product development five years hence. Though Haitz kept his cards close to his chest - Philips had yet to sign a non-disclosure agreement with HP - some hasty, back-of-the-envelope calculations left both parties in no doubt by the end of the day that the future of LEDs lay in the lighting business.

  On the plane home to California Haitz wrote up his impressions in a trip report. LEDs would clearly be in lighting and lighting was a huge market. If Hewlett Packard wanted to remain a major player in the LED business, the company had no choice other than to participate. But HP could not go it alone because it didn’t understand the market. “If we are not tied up with a lighting company, we will make mistake after mistake, and we are going to get our ass kicked,” Haitz concluded with characteristic brusqueness. “We have to find a partner.” There were three possibilities: Osram-Sylvania, GE, and Philips. Osram already had its own internal LED business; GE was no longer interested in making investments in lighting technology. “So there was really only one girl to dance with,” Haitz said, “and that was Philips.”

  LEDs as light to see by required a leap of the imagination. Their output compared to that of conventional lamps was still puny. “When we first thought LED technology would have a big role to play in illumination in the mid nineties, we’d occasionally look at ourselves in the mirror and think, Are we kidding ourselves or what?” recalled Karen Owyeung, who was then the Optoelectronics Division’s general manager. HP’s top brass took a lot of persuading that there would be value in teaming up with Philips Lighting. But Haitz persevered; eventually, he succeeded in winning them over.

  For his part, Begemann reported back to Philips that Haitz had told him that by 2000 it would be possible to make LED street-lights that were as good as the most efficient conventional products. Most of his colleagues still thought he was crazy. But his boss gave him the go-ahead - and a million dollars - to set up a feasibility study with HP, to be followed by a demonstration project. Begemann and Kloster flew to California. They presented the Eindhoven work. A tentative joint agreement was drafted and signed. The two companies initiated their cooperation in late 1994. They began by hashing out potential markets for LEDs. These included lighting for growing plants in greenhouses, a big deal in Holland, where horticulture is huge. Also, lighting for rearing chickens — apparently hens are sensitive to flicker, ruling out the use of fluorescent lamps in their coops. Eventually, it was decided to focus initially on the development of a prototype street-light based on HP’s amber LEDs because that market was already accustomed to orange-colored illumination.

  “I got two guys from HP and two guys from Philips Lighting and they spent half a year locked up in our lab here in Holland,” Begemann recalled. Such a tight deadline was very different from the leisurely way that development programs usually proceeded at Philips. “This was a project where we were exposed to Bay Area dynamics and the semiconductor world, where things are three times faster if not more,” recalled Berry Kock, one of the two Philips representatives on the team. The engineers dreamed up a suitably rebellious-sounding name: they called themselves HELLS Angels, the initials standing for High Efficiency LED Lighting Systems. “It was the most secret development project we had ever had in lighting,” Begemann said. Team members were under strict instructions not to discuss their work with anyone. The benchmark had been defined: high-pressure sodium lights had an efficiency of about one hundred lumens per watt. LEDs could only manage half as many lumens, but by directi
ng the light more efficiently in a much tighter beam, the team showed it was possible to match the performance of conventional products.

  By October 1995, they were ready to unveil their work. Begemann made sure that all his colleagues in top management at Philips Lighting attended. Three prototype LED street lights were set up in a warehouselike building in Eindhoven that the applications people used for running tests. Inside it was like a movie set, complete with props, in this case traffic signals and lines painted on the floor to simulate an actual street. “We tried to make it as real as possible,” Kock said. For maximum effect, the curtains were tightly drawn to make it very dark inside. The element of surprise worked in their favour. “Everyone was completely flabbergasted that we were doing such a thing with LEDs which were thought to be tiny lights on your stereo set,” Kock said. “It was definitely a moment when people noticed something which they did not believe would ever exist.”

  Gerard Harbers, an optical designer from Philips Research, would never forget the thrill of seeing LED street lights for the first time. “It made a huge impression on me,” Harbers said. “Here you were in this big space and there’s this single lamp which illuminates the whole space, the whole street. It showed, for the first time, real solid-state lighting. And I think that everyone who saw the demo got that same feeling: this will be big, this will be huge — if you can do this already now, what will the future bring?” For Harbers, it was literally a life-changing experience. He has been working in LED lighting ever since.4