When Google picked Himax as the supplier for its Google Glass device, it was clear that the market success of Google Glass would increase the demand for LCOS displays. To ensure the supply capacity for the displays, Google made an investment into Himax. This led to the 6.3% stake Google acquired in 2013. Part of this deal was the option to buy an additional 8% stake in 2014.
Google has chosen not to take the option and will not make an additional investment in Himax at this time. Google and Himax issued the following statement: “Google continues to work closely with Himax as a strategic partner on future technologies and products and will remain a board observer”.
As a consequence, the Himax stock price plunged from an $8 level to $6.80 after the announcement but has since recovered to a $7.50 value. – Norbert Hildebrand
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This decision has also raised the question of “if and how” Google will proceed with Google Glass. For many, Google Glass is the cornerstone of the consumer segment of the augmented reality market. While Google has been investing heavily in an augmented reality software company, this move could mean either a more cautious approach to the augmented reality market, a possible a revaluation of the display options, or a change in business direction toward the software and content side versus the device side. It’s hard to say at this point. And don’t forget, Google still holds a 6.3% ownership stake in Himax’s display operations.
While Himax’s shareholders may be suffering from such speculations in the short term, this may also strongly affect the market view on Google Glass and the augmented reality market in total. If Google sees the display supply capacity at Himax as sufficient for its plans, the question is … what changed over the course of the last year? Were the market forecasts for Google Glass too high a year ago and Google has now a more subdued outlook for this technology? Was the capacity ramp-up by Himax enough to satisfy the market plans of Google already? We know that Himax can make more displays today than it can sell, as it has expanded capacity over the past year without major market growth.
Whatever the reasons for the investment decision, without a major market launch of Google Glass in the near future, speculation about the future plans of Google in AR will run wild. (NH)