Rakon gets smaller and weaker (but in a good way)

Weak signals are key to success in GPS market, company says

Auckland engineering firm Rakon may have cornered the market in providing quartz crystals for everything from radios to GPS locator beacons, but its new product is designed to take on the cellphone market in a whole new way.

Rakon is moving up the food chain, says managing director Brent Robinson, by building a full radio/GPS module in a single unit that’s small enough for cellphone manufacturers to easily drop it into their products.

“That’s a 650 million unit market today,” Robinson says.

But that’s just the tip of the iceberg, he says, and there are two other markets that are “equally as big, if not bigger”. He declined to go into detail about them, however.

Rakon began life in 1967 when it was founded by Robinson’s father as a marine radio equipment maker. Today the company is run by two brothers — Darren Robinson is marketing director — and employs around 300 staff at its Auckland office.

Rakon buys quartz crystal in bulk and slices and refines each block into around 100,000 wafers per kilogram. Rakon is the world leader in providing raw crystals, although it is also branching out into the units that house each wafer, whether it’s a chip or an oscillator.

“Each crystal has a certain frequency and that’s directly proportional to the thickness of the wafer itself,” says Robinson. Quartz is very stable and will vary only a fraction — parts per million is the measure — depending on environmental issues like pressure, temperature or electrical current. Each wafer is tested exhaustively at the factory to ensure it oscillates on the correct frequency.

Robinson says while Rakon has built most of the equipment it uses itself, from the ovens used to bake the crystals to the cutting and testing gear, it hasn’t tried to patent its intellectual property in any way.

“We don’t want to put that out there in the public domain because it’s basically a business process. You can’t reverse engineer a crystal — there’s no way to tell from any one crystal what our process is, so it’s very difficult for our competitors to tell just what we’ve done.”

The company has applied for some patent protection, however, with regard to gravity sensitivity. Darren Robinson says the crystals needed for GPS units are so sensitive that simply turning the device over will create enough pressure to distort the frequency.

“In cellphones we talk about sensitivity in the parts per million. In GPS that’s down to parts per billion.” The specifications get even tighter in the consumer GPS space and working indoors in urban areas requires increased “weak signal performance”, says Robinson. Rakon’s research team is working on delivering a threefold increase in sensitivity, to 0.1 parts per million, in the next generation of chips.

Today the company has the capacity to turn out 3 million units a month, but the Robinsons are investing in new equipment that will boost turnover to 10 million units a month by mid-2006.

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