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Sapphires Put Some Sparkle In This Company

Crystal Systems takes the heat, finds a niche

A huge sapphire, 7 carats, sparkles from a gold pin on Fred Schmid's lapel.

But it pales compared with the one he keeps in the office - 13-1/2 inches thick, 175 pounds.

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And he can always grow more. Next year, Mr. Schmid says he hopes to grow a 20-inch sapphire.

Schmid is not the answer to a jeweler's dreams. In fact, other than the gem on his lapel, his sapphires generally come nowhere near jewelry.

High tech, not high fashion

They're clear, not blue, and industrial not ornamental.

They're worth plenty, but only when put to work in submarines, oil wells, satellites, and lasers, not around the wrists and necks of women on the social register.

Schmid's sapphires can withstand extreme heat and pressure and can be made much thicker than glass, without distortion - which makes them ideal for windows that have to brave extreme elements.

Schmid's company, Crystal Systems in Salem, Mass., produces sapphires that become windows in submarine periscopes, missiles, and automotive engines used for research.

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Schmid built Crystal Systems in 1970 from technology he helped develop at the US Army Research Center in Watertown, Mass.

The lab there tried to develop thick crystals for use as armor.

The approach didn't work, and the arsenal closed in 1967.

A different beat

Schmid, however, saw a different potential for the research, and is the only person to commercialize any of the lab's work.

An avid sailor, Schmid founded Crystal Systems over a handshake with three investors while watching a sailboat race in 1970.

They put up $1,700, and Schmid used it to buy a salvaged industrial furnace. Later Schmid bought out his partners and now posts $6 million in annual sales.

Schmid's technology, the Heat Exchanger Method, uses a vacuum-sealed furnace heated to 2,050 degrees C.

A "seed" crystal is put into the furnace, along with blocks of silica. When the silica melts, its molecules line up with those of the seed crystal.

A helium-gas jet cools the substance into a crystal - a carefully controlled process that can take weeks. The cooling jet is the key to making larger, clearer crystals than others make.

Schmid says he hopes to get distortion down even further, to the microscopic level.

In the 1970s, the market was hot for industrial sapphires as heat-resistant beds for silicon wafers, since sapphire melts at a much higher temperature than silicon.

But going up against big rivals proved unsettling.

"I saw that if I went after the silicon-on-sapphire market, Union Carbide would kill me," he says. "I was looking down the barrel of a double-barreled shotgun."

Schmid decided to switch tracks and focus instead on optical applications, windows.

Schmid's vacuum-sealed furnaces made his sapphires clearer than competitors' products and better suited to optical applications.

The company sells a number of spinoff products, such as patented furnaces to grow silicon for solar cells.

It has developed titanium-doped sapphire rods, 3/8-inch in diameter, that allow lasers to be fine-tuned.

Aiming high

The company is also working on a new technology for cutting the sapphires with less waste than the usual diamond-tipped blades.

Schmid describes his goals in superlatives: "We want to produce the highest quality, largest size crystals."

But he also wants to stay out of disputes with larger competitors. "One thing I'm very proud of is that we have not gotten into the rat race. We have avoided all the confrontational stuff ... in business."

This led Crystal Systems to outsourcing, sending much of its manufacturing to outside companies, long before it was popular.

"We don't have all the ideas, so we have to work closely with people who can help us develop them," Schmid says. "Withholding information doesn't get you to the cutting edge."

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