MTI Micro Fuel Cell said Thursday it has signed a $1-million deal with Samsung Electronics to develop fuel cell prototypes for mobile phones and accessories.
The fuel cell startup said it's the first such deal for micro fuel cells in cell phones. “The vote of confidence from Samsung is very, very significant,” said MTI Micro CEO Peng Lim. “We are very excited about it.”
The deal is also a “significant” step toward commercialization for the much-anticipated and much-delayed technology, said Sara Bradford, research director for the power systems group for market research firm Frost & Sullivan (see Fuel Cell Follies, Top 10 Trends: Micro Energy, Finally?).
Top 10 Trends: Micro Energy, Finally?“As today’s consumer electronic devices are becoming increasingly power-hungry and multifunctional, conventional rechargeable batteries are challenged to provide the required runtime consumers demand,” she said. “Micro fuel cells are expected to provide the solution to this challenge.”
Samsung, the third-largest mobile phone maker, sees the move to develop fuel cells as a push to overcome “one of the most challenging issues of the mobile industry,” said Young Woo Lee, a vice president at Samsung Electronics. “By allying with MTI Micro, Samsung is empowered to go beyond the established boundaries of what is currently possible with mobile phone design and functionality.”
The Deal
According to the deal, Samsung and MTI Micro will work together for 15 months to develop the prototypes.
During that time, Samsung won’t work with any other fuel cell company to develop fuel cells for phones, and MTI Micro won’t work with any other company’s mobile phone segment, said Alan Soucy, chief corporate strategist for MTI Micro.
“Samsung Electronics is one of the largest consumer-electronics companies out there, and they are committed to us,” Mr. Lim said. “Remember they also put an exclusive on their side. And, on top of that, they are giving us $1 million to work with them.
“In general, on the [original equipment manufacturers] side, they don’t pay people. In fact, the component people have to beg them to put their component into their product,” he added.
Mr. Lim emphasized that the prototype work will not be a matter of proving the micro fuel cell technology works, but of conforming it to Samsung’s products.
“Being a brand-new, high-energy technology, this is a natural phase we have to go through to produce a prototype that matches their product direction and a road map for commercialization,” he said. “It’s a test to prove how well the two companies can work together and how well our products work together.”
At the end of the 15 months, MTI Micro expects to have a prototype that meets Samsung’s specifications, Mr. Lim said. If the prototype is successful, the intent—specified in the strategic alliance deal—is to commercialize MTI Micro’s technology in Samsung phones, he said.
Fuel Cell Background
Fuel cells produce power by mixing fuel with air and water between a thin, reactive film membrane in an electrochemical reaction. Most micro fuel cell technologies use methanol as the fuel, and often, platinum is used as the catalyst to create the reaction.
Eventually, fuel cells are expected to be smaller, lighter, and up to 10 times more powerful than existing batteries. The market demand for these fuel cells is tantalizing.
Frost & Sullivan expects the market for micro fuel cells for consumer electronics devices to reach approximately 80 million units by 2012. While that’s a large market, the forecast has been lowered from Frost & Sullivan’s earlier expectation of 126 million units on the market by 2010.
Market research firm Clean Edge says the fuel cell market will grow to $15.1 billion in 2015 from $1.2 billion in 2005.
But challenges have caused many companies to miss their promises, delaying product launches and keeping micro fuel cells from consumers.
Technical challenges include heat and waste management, size and weight issues, and low efficiency. Business challenges include a lack of standards, an absent supply chain and cartridge distribution system, and high costs.
MTI Micro’s Technology
MTI Micro said its Mobion technology overcomes many of the technical challenges with patented water management technology. While most fuel cells have systems to collect and recirculate water from one side of the battery, where it’s produced as a byproduct, to the other side, where it is used, MTI’s design simplifies the process and removes the need for micro plumbing.
That means that more of the space in the fuel cell can be filled with methane, giving the cell higher energy density than its competitors’ cells, Mr. Soucy said.
Laws that prohibit methanol in airplane passenger cabins had also previously been a concern, but the International Civil Aviation Organization changed the law, allowing methanol fuel cells on international flights.
Methanol-based fuel-cell companies are also waiting for the U.S. Department of Transportation to apply new standards, expected to happen in 2007, Mr. Lim said.