Authentec

As Apple’s September 10th event iPhone event approaches, we’ve learned some additional details and have independently heard some of the already-floating around information regarding the upcoming announcements.

We’ve long been expecting Apple to launch an iPhone 5S at this upcoming event, an iPhone that looks almost identical to the iPhone 5 but with improved internals. For past iPhone “S” upgrades, like the iPhone 3GS and iPhone 4S, Apple has retained the same design and colors as the previous models. Black and white units in both of those cases.
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But, we’ve heard, 2013 will be a bit different. Color will be a differentiator. Much like the much-rumored plastic iPhone will see Apple expand its color palette for iPhones, the iPhone 5S will move beyond the black/slate and white/silver options offered for the iPhone 5…

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<a href="http://9to5mac.com/2013/08/10/new-mockups-claim-to-show-iphone-5s-and-iphone-5c-designs-gallery/">iPhone 5S/5C physical mockups</a>

Apple’s next two iPhone models will be named iPhone 5S and iPhone 5C, according to a report from Japan-based Macotakara. With repeated reports and rumors of the next-generation iPhone retaining the same design as the iPhone 5, the “iPhone 5S” name has long been claimed and regarded as the name of the new flagship iPhone. Apple’s iPhone 4S and iPhone 3GS retained the designs of the iPhone 4 and iPhone 3G, respectively.

However, because of Apple’s surprise naming scheme for the third-generation iPad (The new iPad), an outright claim of the name “iPhone 5S” may be important to some interested in the upcoming device.

As for the “iPhone 5C,” this name gained attention when purported packaging materials for the upcoming, lower-cost, plastic iPhone surfaced in photos online. It is unclear what the “C” in “5C” could stand for, but speculation and logic points to the “C” standing for “color.” Like recent iPod touch models, this plastic iPhone is rumored to come in a series of colors…

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We’ve previously noted KGI Securities’ Ming-Chi Kuo for his often accurate reports on upcoming Apple products in the past. Usually those reports revolve around features that have been somewhat expected. We’ve expected a fingerprint scanner for quite some time and even found code that seems to point to a biometric input for the new iPhone. We’ve also profiled possible fingerprint readers in the iPhone 5S just last week.

Today’s report is something a bit out of left field however. Kuo expects the iPhone 5S to have a sapphire fingerprint reader home button that will no longer be plastic and concave but actually protrude slightly from the iPhone in a convex manner. This isn’t the first we’ve heard of Sapphire home buttons but the first reputable source on the matter. Kuo

Convex home button creates space for fingerprint sensor; yield to improve. We think that a fingerprint sensor will be placed under the home button of iPhone 5S. However, assembling it could be difficult as the space under home button is limited as it already has to accommodate the Lightning connector, speaker and microphone. Thus, we think the shape of the home button could be changed from concave to convex to create more space for a fingerprint sensor.

Sapphire prevents home button from being scratched. A convex home button could be more easily scratched, so a harder material is required. We believe Apple will switch from plastic to sapphire, whose hardness is second only to diamond. Sapphire would protect the home button from being scratched and the fingerprint sensor from being damaged.

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<a href="http://9to5mac.com/2013/06/21/apple-patent-application-describes-fingerprint-sensor-tech-rumored-for-iphone-5s/">Apple fingerprint sensor patent</a>

Digitimes, which is notorious for its mixed track record, is out with a new report claiming that initial shipments of Apple’s next-generation iPhone will be in tight supply. The reason being low yield rates for the production of the sensor for the device’s rumored fingerprint scanning technology. That’s in addition to some chips required to power the new iPhone’s LCD.

Poor yields of fingerprint-recognition chips and LCD driver ICs will likely force Apple to reduce first-quarter shipments of the rumored iPhone 5S, which is slated for launch in September 2013, according to industry sources. Volume production of fingerprint-recognition and LCD driver chips for the iPhone 5S should have started at the end of June or early in July, but issues related to yield rates will delay commercial production of the two chips to the end of July, therefore affecting the initial supply of the iPhone 5S, the sources explained.

Furthermore, the site says that production of said device’s sensors should have begun late last month or earlier this month, but production won’t actually begin until later this month. This in turn will affect initial shipments of the new iPhone come September. Digitimes says this will result in 3 million delayed units…

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There have been no shortage of fingerprint sensor rumors surfacing since Apple acquired Authentec last year. According to several reports from analysts, including the often reliable Ming-Chi Kuo and the not as reliable Topeka Capital analyst Brian White, Apple’s next-generation iPhone is likely to include a fingerprint sensor. We’ve discussed how it could certainly make a stand out hardware feature for Apple’s expected “S” upgrade, and today the US Patent and Trademark Office published patent applications that show Apple could be experimenting with exactly that (via PatentlyApple).

According to one aspect of the present disclosure, a biometric sensor assembly, such as a fingerprint sensor, comprises a substrate to which is mounted a die containing sensor circuitry and at least one conductive bezel. As used in the description and claims that follow, “bezel” means a unitary, substantially uniformly composed structure, most typically metal or conductive plastic. The die and the bezel are encased in a unitary encapsulation structure to protect those elements from mechanical, electrical, and environmental damage, yet with a portion of a surface of the die and the bezel exposed or at most thinly covered by the encapsulation or other coating material structure

The patent describes a process of embedding a fingerprint sensor into the bezel of a device, which sounds a lot like the finger print sensors Validity was showing off embedded in Android devices at CES this year (pictured right). Apple notes in the patent application that the sensor would be “approximately the width of an average user’s fingertip, but only several pixels tall, typically between 1 and 8 pixels, and possibly as many as 16 pixels tall” when viewed from above.

Apple doesn’t get too into what functions for users the fingerprint sensor would provide, but does note that “the sensor captures a number of thin strips of the fingerprint as the finger is swiped, and the complete fingerprint is assembled in software for use in authentication.”
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A new job listing on Apple.com could add fire to the rumors that Apple is considering including fingerprint technology in upcoming devices.

The job posting seeking a software engineer to write “low-level code to configure and control hardware” is the only listing on Apple’s site located at the “Melbourne Design Center” in Melbourne, Florida. Not only is the position looking for someone familiar with testing various sensors with LabTool and FA software, but Melbourne is also the home base of Authentec, the company Apple acquired fingerprint technology from last year for around $365 million. 
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There have been many rumors this year about what upgrades Apple will include in its anticipated annual iPhone refresh. Most agree Apple will move to release two iPhones, but there is some debate about what those phones will be.

Rumor has it that Apple is working on a low-cost iPhone that will do away with the current iPhone design and instead use a new plastic case with a curved back similar to previous iPods. Despite being a less expensive device, that could make things even trickier for Apple to impress with an iPhone 5S upgrade that is largely expected to retain the “old” design of the currently shipping iPhone 5. The devices from competitors are making things even more difficult for Apple’s expected “S” upgrade. Rumors of a 4.8-inch iPhone prototype that recently surfaced don’t seem likely for the next iPhone, but that hasn’t stopped mainstream media and analysts from reporting that Apple is losing out on iPhone sales as consumers opt for larger screen devices. However, that might now be the case, at least not in the United States, with Strategy Analytics and NPD estimating Apple beat Samsung to become the No.1 phone vendor in Q4 2012. Will consumers want or expect a larger screen on the next iPhone, or will Apple’s usual minor refresh suffice?

What did past S upgrades have?
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In July, a 10K filing showed that Apple acquired security company AuthenTec for $356 million. At the time, we noted Apple was presumably after the company’s various fingerprint-related technologies, while companies such as Samsung, Motorola, and others entered in deals with AuthenTec for its secure VPNs, encryption algorithms, and security-related products. Today, NFCWorld (via TechCrunch) reported Authentec has now sold its embedded security solutions division to NFC company Inside Secure. The sale would seem to indicate that Apple was indeed specifically after the company’s fingerprint and NFC solutions:

The sale suggests that Apple’s interest in acquiring Authentec lies with the company’s innovative combined fingerprint and NFC solution, which is not part of the division being acquired by Inside Secure, and will lead to renewed speculation that Apple will include NFC in future iPhones and other devices…. NFC and contactless chip provider Inside Secure is to acquire the embedded security systems division of Authentec, the fingerprint and secure solutions specialist which Apple agreed to buy for US$356m in July 2012. The transaction is valued at up to US$48m.

To get a hold of AuthenTec’s Embedded Security Solutions Division, Inside Secure will reportedly pay $38 million in cash and another $10 million “subject to completion of certain post-closing transactions.” Products the division is responsible for are currently used in hundreds of millions of mobile and networking devices worldwide, with customers ranging from Samsung, Nokia, LG, and Motorola to HBO, Cisco, and Texas Instruments. Last year, the division brought in sales of $25.3 million.
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With Apple’s $356 million purchase of mobile security firm AuthenTec, for its nearly 200 patents covering fingerprint and sensor technologies, there has been a lot of talk about how Apple might integrate the technology into future devices. Adding to the rumors are recent reports that Apple signed a deal with Sydney, Australia-based Microlatch to develop NFC apps using its fingerprint authentication tech. Today, we get a look at some possible areas Apple might be exploring with the technology thanks to a patent application published by the U.S. Patent and Trademark Office and detailed by Patently Apple.

As highlighted in the image above, Apple’s patent covers a hidden color-matched or transparent “window”—next to the iPhone’s home button in this case—that could reveal “components by causing the electronic window to change opacity, allowing the components to suddenly appear as from out of nowhere.” In other words, Apple could build a biometric sensor or camera into a device’s bezel but have it remain invisible to the user—at least when not in use. One embodiment of the invention described using fingerprint tech during the unlocking process (pictured right):

In Apple’s patent FIGS. 12 and 13 shown below we see a biometric sensor in context with a fingerprint reader which is initially concealed behind a closed window on an iPhone. Upon the iPhone’s activation in a locked state, a lock screen 160 may be displayed requesting a user to slide a finger across the display to unlock the device. The electronic device may request user authentication to access the handheld device. The device may then display an instruction screen requesting that a user provide biometric data via their fingerprint which will be read by the fingerprint reader.

The patent also covers similar methods using face recognition and eye recognition rather than fingerprint sensors; the invention would also not be limited to unlocking devices. The patent continued by describing e-commerce and wallet applications, which would line up with the earlier reports regarding Microlatch:
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