The significance of the deal with Samsung ("MTI Micro signs $1M deal with Samsung," Business Review May 19-25) was brought home in a BusinessWeek Online article shareholders found on their seats at last week's meeting. The article called the deal "one of the biggest publicly disclosed commitments to the technology by a major manufacturer in years" and said it "marks a big step forward for a fledgling fuel-cell industry that aims to supplant the batteries typically used in notebook PCs, wireless phones, PDAs and digital cameras."

Peng Lim, MTI MicroFuel Cells' new president and CEO, outlined why the dramatic and relentless growth in computer-chip capacity is making consumers demand more of their electronic devices and was creating a demand for a better power source than existing battery technology. Basically, as people use their cell phones to do more than just talk, as they watch movies, listen to music and take photos, they need more power than batteries can provide.

That battery strain is creating an opportunity for MTI MicroFuels' Mobion fuel cells.

Samsung is the world's third-largest manufacturer of cell phones. That is a lot of cell phones that need a lot of batteries or, hopefully, fuel cells. The possibilities are huge, if it all works out.
Good question

At one point a shareholder asked if the Mobion technology would mean the company would someday manufacture the fuel cells around here.

It was at least the second time in his first week on that job that Lim had been asked that question. When Business Review reporter Richard A. D'Errico asked it a week earlier, Lim said, "Ultimately, it will be difficult to do high-volume manufacturing in the Capital Region. But we're just not sure."

At the shareholders' meeting, Lim said that when the time comes, the company would have various manufacturing options. One option would be to license the technology and let companies like Samsung do the manufacturing. MTI might decide that the local work force can best do the job. Doing its own manufacturing would give MTI the added security of keeping its intellectual property inhouse. A third option cited by Lim would be to pay an outside manufacturer to make the fuel cells.
It will be a business decision

Of course, when MTI reaches that point with its Mobion technology, its customers' needs and Wall Street's interests will factor in big-time. Would the fuel cells cost Samsung less if the plant is in Asia? Would investors be happier if the plant is in China or Latham, N.Y.? Hmmm.

The manufacturing question often hangs over upstate New York business discussions like a dark cloud.