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After years of investing in technology companies that supply businesses, they are paying lofty sums to fund dozens of consumer-focused start-ups that do everything from connecting digital devices in homes to making games for cellphones. Many venture capitalists will be out in force at next week's Consumer Electronics Show in Las Vegas, hoping to get an inside track on the next gadget that could turn into an investment opportunity. [Rebecca Buckman, Wall Street Journal, Dec 29] A handful of futuristic chip-making technologies at the atomic scale have been added to an industry planning effort that charts the future of the semiconductor manufacturing industry every two years. The transition to a post-silicon era is forecast in a report called the "International Technology Roadmap for Semiconductors," . [John Markoff, San Francisco Chronicle, Dec 29] BearingPoint also advises startups to seek
out non-government opportunities because demand for security technologies is
equally high in the private sector. ... 19 startups in Three technology giants have banded together to provide researchers at the University of California-Berkeley with $7.5 M to help entrepreneurs make their innovations available to as wide an audience as possible. Google, Microsoft and Sun Microsystems each will contribute $500K a year over the next five years to fund research at a new UC-Berkeley lab. The Reliable, Adaptive and Distributed systems Laboratory, or RAD Lab, will be staffed with six UC-Berkeley faculty members and about a dozen computer science graduates. The goal is to create technologies that can help Internet entrepreneurs or inventors more easily make growing services available to hundreds of thousands or millions of users, said David Patterson, UC-Berkeley professor of electrical engineering and computer sciences and founding director of the RAD Lab. [Michael Bazeley, San Jose Mercury News, Dec 15] the stem cell scandals remind us that the technological road to growth is long and far more uncertain than it seems. New technologies, even the most promising ones, are hell to get working, and even harder to make commercially viable. History is littered with great ideas which turned out to be dead ends--and there's no way of predicting ahead of time which ones those will be. [Michael Mandel, Economics Unbound blog, Business Week, Dec 17] Doug Engelbart invented computer networks, time sharing, graphical user interfaces, and the mouse--all while driving to work one day in 1951. Really. [I, Cringely, Dec 9 http://www.pbs.org/cringely/ ] Feynman's room at the bottom is indeed vast, but it has limits. Right now, micro-technology prospers by jamming ever more transistors into strips of silicon real estate as little as 1,000 atoms wide. That's close to the quantum limit for normal transistor function. For nanotech dreams to come true, that real estate must narrow further, sacrificing function along the way. And the narrowing itself, at some point, becomes impossible. Atoms are positively shrink-proof, so when transistors shrivel to the one-atom limit, Moore's Law as we know it will hit the end of its silicon rails. [Russell Seitz reviewing tow new nanotech books, Wall Street Journal, Dec 16] To compete in a global economy, you simply must maintain the low-cost producer status. Do you save local jobs today knowing that it could mean the end of your company tomorrow? The same holds true for the pensions and lifetime medical benefits that are strangling the competitiveness of U.S. businesses. The economics are clear, but what about moral and ethical considerations? [Al Schultz, CEO, Valassis Communications, Industry Week, Dec 16] Innovation doctor Ignaz Semmelweis achieved a dramatic reduction in deaths by insisting that doctors wash their hands between autopsies and obstetrical examinations. But other doctors refused to believe that their own hands transferred disease. Besides, they grumbled, hand-washing was far too time-consuming. widely ridiculed and eventually fired. ... similar opposition to his proposed reforms, which involve a far greater use of computers by doctors. As in 19th-century Vienna, many doctors today cannot believe that their inability to retain today's vast medical knowledge in their heads is harming patients, ... Dr Weed, who turns 82 this month, is the embodiment of indefatigability, devotion and determination. He has spent more than three decades devising software that matches a patient's symptoms and health history against an exhaustive catalogue of computerised medical knowledge. ... Websites Dr Weed founded the Problem-Knowledge Coupler Corporation in 1982. A 1999 report by the Institute of Medicine examined the frequency of medical errors. A study by the National Committee for Quality Assurance attributed 57,000 deaths per year to a lack of best-practice care. RAND Health has published a number of studies on informatics and technology. Medline indexed 3,672 articles on coronary heart disease in 2004. [The Economist, Dec 8 http://www.economist.com/printedition/PrinterFriendly.cfm?story_id=5269189] Technology spending by enterprises this year will exceed the peak level of 2000, said Mark Zandi, chief economist for Moody's Economy.com, who noted that consumers have picked up much of the slack for high-tech vendors in recent years. ''Businesses are flush with cash," Zandi said. ''They're looking for ways to expand. The equipment they invested in for Y2K is rapidly deteriorating. [Robert Weisman, Boston Globe, Dec 12] Good news for SBIR companies that actually make commercially useful products; no news for those who want to be just government contractors. now as many tech blogs as stars in the sky, only a tiny fraction of them matter. .... The easiest way to follow this world is via a useful blog-tracking service called tech.memeorandum ... Another site, blogniscient.com, offers a similar service [Lee Gomes, Wall Street Journal, Dec 7] Executives at any big medical-device company launching a critical new product know two things in their bones. One: Those new devices can generate such powerful profits that it seems to rain money. The other: Weather is changeable. Medical-device advances that create vast riches always face relentless competitive pressure that squashes fat profits sooner rather than later. [Steven Syre, Boston Globe, Dec 6] I Have the Idea, You Have the Factory .. But it is going to take more than the first wave of novel products to convince big businesses that access to the new technology is worth quite as much today as many of its entrepreneurs believe. ... materials buyers at 20 multinationals averaging 100,000 employees and $55 billion in annual revenue, 70 percent said it was their company that dictated the terms. Lux also found other disagreements on what the ideal deal looks like. For instance, 65 percent of the small companies wanted the multinationals to pay them license fees. But only 35 percent of the big companies wanted to take such licenses. Many of them want to handle nanomaterials like the commodities they are often replacing: tell us what the product costs per unit and then ship us as much as we want. [Barnaby Feder, New York Times, Nov 16 http://www.nytimes.com/2005/11/16/business/businessspecial/16feder.html?ex=1133845200&en=05c7cc3dd7be6345&ei=5070 ] SBIR proposals all too typically say, "The product will get x% of a fantastically growing market,:" and expect the government agency (if it cares at all) to credit the proposer with commercialization potential. Savvy reviewers will reject that claim as an indicator of market laziness in a lifestyle company. More Globalization of Technology. AP reports that Intel is about to invest another $500 M in its Indian operations in Intel's research lab and marketing division, and half to develop a personal computer, Meanwhile, Intel's toughest trailing competitor Advanced Micro Devices had already done a consortium deal to supply technology for a proposed $3B billion chip-making factory in India. Is this a healthy development? Depends on your attitude toward an integrated world of markets and producers. Want cheap computers (and other electronic toys) and cheap cars? Get a day's labor what an hour's labor costs in the USA. Is there anything the government could do, short of imposing capital controls and thus driving up the cost of everything? It might take a more investment attitude toward seed technology with its SBIR money instead of using most of it to do what the mainline R&D programs are doing anyway to make government-use equipment and government-use knowledge. Let Congress amend the act, over the howls and shrieks of the SBIR pie-share political advocates, to require economic impact as at least an equal criterion with government utility of the technology. Don't know how to pick winners nor evaluate economic impact? Not surprising. Let third party interest get a vote. More Fast Track and fewer turbulence models. Israel has emerged as the go-to country for antiterrorism technologies. ... Israel has spawned companies selling guns that shoot around corners, software that translates dog barks into English-language warnings and lasers that can detect explosives from 100 feet away. Working their way through labs now are intelligent robotic cameras, and nanolasers and nuclear resonance imagers to detect chemical and bioweapons. ... The global trade in antiterror gear and consulting services is expected to grow to $178B by 2015. (The U.S. accounts for half.) [Susan Karlin, Forbes, Dec 12]America's work force is divided into three parts: about 25% are the 'smart people' (that's you) who are educated and also have special career skills; another 25 percent are the 'walking dead,' (that's your uncle) victims of mergers or technological change and need to acquire new skills in order to change jobs or even careers . . . and up to 50 percent are the 'techno-peasants,' (the people you need to hire) poorly educated adults with few if any special career skills," says Edwin Gordon. [Cecil Johnson, Boston Globe, Dec 4 http://www.boston.com/business/articles/2005/12/04/labor_crisis_will_put_us_economy_to_the_test/ ] And a too large part of the smart 25% are your SBIR competitors scratching out a living on low margin government set-aside contracts. How Smart Science Gets Dumbed Down. "Science is done by scientists. Then a press release is written by a nonscientist, who runs it by their nonscientist boss, who then sends it to journalists without a science education who try to convey difficult new ideas to an audience of either laypeople or, more likely, people who know their way around a t-test a lot better than any of these intermediaries. Finally, it's edited by a team of people who don't understand it." Posted on www.badscience.net [Wired, Dec 05] Big Organizations Need Big Fuzzy Words. “The purpose of this instruction is to establish the policies and procedures of the Joint Capabilities Integration and Development System (JCIDS) … To achieve substantive improvement in joint warfighting and interoperability in the battlespace of the future, coordination among DoD components is essential from the start of the JCIDS process. That process will establish the linkage between the joint concepts, the analysis needed to identify capabilities required to execute the concepts and systems delivering (them) … New solution sets must be crafted to deliver technologically sound, testable, sustainable and affordable increments of militarily useful capability. JCIDS implements the evolutionary acquisition approach to capability development … All capabilities shall be developed, tested and procured to leverage the unique capabilities of other DoD components.” [a Joint Chiefs of Staff directive] They want a hole. Earlier this month, Coca-Cola announced that it was pulling the plug on Vanilla Coke. The news made headlines, but in fact, most new products are doomed to an early death. Of the 30,000 new consumer products launched each year, over 90% of them fail. ... Why? ... prevailing models of segmentation and brand building. Carving up markets by product, price point or customer type often causes marketers to deliver products overloaded with unwanted features or designed to improve on a product or appeal to a demographic profile -- but not necessarily real customers. ... professor Theodore Levitt used to say: "People don't want to buy a quarter-inch drill. They want a quarter-inch hole!" [Christensen, Cook, and Hall, Wall Street Journal, Nov 29] a quotation from Mr Drucker What is our business? Who is our customer? What does the customer consider value? While that might work well for large business in the short run, it does not work for innovators developing something for which there is no present customer. The MIT VCPE Club invites you to the 8th Annual MIT Venture Capital Conference, "Capitalizing on a Flat World,"at the MIT Tang Center on Saturday, December 3rd. This year's conference explores how to take advantage of the new ways that businesses create, communicate, and access data-rich content from anywhere, at any time. The keynote addresses will feature Jim Champy, Chairman of Perot Systems' Consulting Practice; and Jeremy Allaire, former CTO of Macromedia, Inc. and founder of Brightcove, Inc. Underlining the challenge, Romney said leaders of one technology firm in Massachusetts anticipated that 90 percent of its skilled labor would be in Asia in 10 years. He also pointed to statistics that show the United States graduating only 4,400 mathematics and science PhDs each year compared with 24,900 math and science PhDs for greater Asia. [Stan Gibson, eWeek.com, Nov 16 http://www.eweek.com/article2/0,,1888019,00.asp ] Drucker Speaks: From "The Five Deadly Business Sins," Oct. 21, 1993: The first and easily the most common sin is the worship of high profit margins and of "premium pricing." … GM's troubles -- and those of the entire U.S. automobile industry -- are, in large measure, also the result of the fixation on profit margin. By 1970, the Volkswagen Beetle had taken almost 10% of the American market, showing there was U.S. demand for a small and fuel-efficient car. A few years later, after the first "oil crisis," that market had become very large and was growing fast. Yet the U.S. auto makers were quite content for many years to leave it to the Japanese, as small-car profit margins appeared to be so much lower than those for big cars. The lesson: The worship of premium pricing always creates a market for the competitor. And high profit margins do not equal maximum profits. Total profit is profit margin multiplied by turnover. Maximum profit is thus obtained by the profit margin that yields the largest total profit flow, and that is usually the profit margin that produces optimum market standing. [excerpted Wall Street Journal, Nov 14] By 2010, Kurzweil said, computers will begin to disappear, instead becoming embedded in the environment and into materials such as clothing and eyeglasses. Images will be written directly on human retinas ... "2029 is where technology really gets interesting because we'll have had all of this exponential growth taking place over the next 25 years," said Kurzweil. By this time, computation will move from the device and become Web-centric. "There is going to be a worldwide mesh consisting of tiny devices, nodes in clothing and in the environment, each sending and receiving their own messages, as well as passing on other peoples' messages," [Kevin McLaughlin, CRN, Nov 16 http://www.crn.com/showArticle.jhtml?sssdmh=dm4.158214&articleID=173603287 ]
The hope is that solar dishes will one day make electricity for less than 10 cents a kilowatt hour, which is about what it costs to make electricity at modern, gas-fired power plants at today's fuel prices and less than half the cost of making it with photovoltaic panels. [Rebecca Smith,Wall Street Journal, Nov 17] All the grand plans for Ambitious plans to cover two big swaths of California desert with solar dishes will come to naught unless and until they can get the unit cost of power down to competitive levels. And large government subsidies merely transfer the extra cost from the taxpayer's utility bill to the taxpayer's tax bill (unless deficit finance can go eternal). It is no coincidence that domestic manufacturing started to lose its global competitive edge when the Old World craftsmen who had immigrated to the U.S. decades earlier began to retire from the workforce. But craftsmen just like them are still alive and well -- and working -- in Europe, in Japan, in Korea and elsewhere. They know quality, and they see no reason why they should ever have to settle for anything less. American manufacturers who ignore this most basic principle of global business do so at their peril. When they trim engineering, R&D, quality-control and personnel budgets to save a few bucks up front, they are being penny wise and Pound/Euro/Yen foolish [Marc Gottlieb, Industry Week, Nov 2] The WSJ's StartupJournal features a post about the current state of the venture ecosystem and VCs appetite for more mature companies - those with established products/services, growing revenues and clear direction - Later-Staged Companies See More Venture Funds. This certainly isn't news but rather further confirmation of a trend that started soon after the melt-down in early 2000 when the adults regained control of the purse strings. ... That said, now seems to be like a pretty good time to be starting companies and seeking funding. The project I'm actively working on has already had a series of meetings with VCs who would not otherwise consider seed stage investments. [Drakeview (a blog), Nov 11 http://drakeview.typepad.com/pm_pd/2005/11/vcs_going_long.html ] If you're an entrepreneur looking for capital for a new idea with future market appeal, you probably need both the money and the adult business supervision of a VC. If that's the case, SBIR is probably a diversion and a distraction of dead end money. Value Line, a ratings advisory, touted ATMI (Sep 05) as a key supplier of materials for copper wafers, and paying off its debt. It is still trading at 30+ PE 2006 could be the year when everything flips back." The macro backdrop is good for tech spending, but there will be a shift, which has already begun, from the consumer to businesses," asserts Mark Zandi, chief economist at West Chester, Pa.-based Economy.com [Eric Savitz, Barron's, Nov 14 http://online.barrons.com/article/SB113175490252095378.html?mod=home_us_inside_today ] Inventors have always held a special place in American history and business lore, embodying innovation and economic progress in a country that has long prized individual creativity and the power of great ideas. In recent decades, tinkerers and researchers have given society microchips, personal computers, the Internet, balloon catheters, bar codes, fiber optics, e-mail systems, hearing aids, air bags and automated teller machines, among a bevy of other devices. [Inventor James] West stands firmly in this tradition - a tradition that he said may soon be upended. He fears that corporate and public nurturing of inventors and scientific research is faltering and that America will pay a serious economic and intellectual penalty for this lapse. A larger pool of Mr. West's colleagues echoes his concerns. "The scientific and technical building blocks of our economic leadership are eroding at a time when many other nations are gathering strength," the National Academy of Sciences observed in a report released last month. [Timothy O'Brien, New York Times, Nov 13] Government is wasting its innovation structure - SBIR - that could nurture some of the better innovators by doing just what the other corporate entities do - sponsor incremental advances by lifestyle companies for present uses. Nuclear winter is over in the high-tech job market. Software developers, design and systems engineers, network administrators and others are finding companies with a slew of openings eager to make offers and willing to negotiate better pay and benefits. [Jane Larson, Arizona Republic, Nov 13] Since the small-cap cycle began in 1999 -- a span over which the S&P Smallcap 600, as noted, rose more than 100% -- the Russell 2000 has gained only 54%. [Rhoda Brammer, Barron's Nov 14] Start-ups also are becoming easier to build without venture cash because entrepreneurs can now outsource programming chores to cheap, offshore engineers. ... Some [internet] entrepreneurs can now get their start-ups off the ground for less than one-10th of what it used to cost. [Rebecca Buckman, Wall Street Journal, Oct 31] Opinity has created a service that lets web sites and users get information on a person's reputation, even if that person use several pseudonyms, [news.com, Nov 9 http://news.com.com/2061-11128_3-5942199.html ] A small, but growing number of people think that a looming shortage of drinking water constitutes a much larger crisis. Water consumption is doubling every twenty years, but the supply isn't growing at the same rate, according to Kevin McGovern, chairman of venture firm McGovern Capital, quoting U.N. statistics. [news.com, Oct 25 http://news.com.com/2061-11128_3-5913118.html] It is a tech opportunity. The supply is adequate and fixed by nature, but raising the useful supply is a matter of handling and treatment of nature's bounty - just an opportunity for cheap tech (or in the US and Europe for modest cost tech). Startups are hot -- again. Valuations are nuts -- again. Fortunes are being made -- again. Signs of the renaissance are popping up everywhere. Venture capital is flowing more profusely than it has since the late 1990s; money invested in early-stage startups could top $1.5 B this year, up 50% from last year and almost double 2003’s figure. More significantly, the average seed investment, $4.4M , is three times what it was a year ago and larger than it was in 2000. That means that VCs are valuing startups at higher levels than at the height of the boom. [Michael Copeland, Business 2.0, Nov 05 http://www.business2.com/b2/web/articles/0,17863,1119656,00.html] Unfortunately for most SBIR companies, the government is unlikely to be the early seed money that gets an idea to VC seed stage. Government wants either sound incremental science or a product that has no huge profit appeal. Where do you see the most exciting pockets of innovation? All over the map: On the one hand, in terms of stuff you can see, [it's] in the Web. And with the build-out of broadband and mobile, there's the build-out of new, huge Web startups. [There are] huge rates of change, and businesses are continuing to build out Web applications. You go into any company, and the number of new Web sites is just staggering. ... We've entered a phase where a lot [that was] invented in the 1990s is being deployed at a massive scale. That stuff is all accelerated and we're at the beginning of a 10-year wave of deployment. [Marc Andreessen, quoted Business Week, Oct 10] Innovation Alarm. decisive action is needed now, says the NAS about US slippage in innovation. In 2001, U.S. industry spent more on tort litigation than on R&D. The solution(s), more money of course: increase the national investment in basic research by 10% each year over the next seven years; 25,000 new, competitive four-year undergraduate scholarships; tax incentives for innovation (tax policy as incentive for everything good leads to a complicated tax structure); Read the report http://books.nap.edu/catalog/11463.html [SSTI, Oct 25] In line with NAS's worry about a shortage of smart engineers, High-tech talent may soon be in short supply again, says Robert Weisman [Boston Globe, September 18] about The buzz at the Society for Information Management symposium One college dean (who doesn't have to meet company payrolls and profit targets) went so far as to advise employers to Hire talented technology workers whenever you find them, even if you don't have a specific job opening Forbes's annual list of the best 200 small companies included three SBIR companies: Cerdayne (for the third straight year) , SurModics (for the sixth straight year) , and II-VI (for the third straight year). Great when you got 'em. Like oil prices for Texas, high-technology wages and venture capital can hurt areas [like Boston] disproportionately during economic downturns. In the long run, though, Gittell's and Sohl's study drew criticism from one venture capitalist, Carl Stjernfeldt, a partner at Battery Ventures in Wellesley, who said a venture-fueled economy is better for a region over a complete economic cycle because it introduces innovation and new industries. [Robert Weisman, Boston Globe, Oct 24 http://www.boston.com/business/technology/articles/2005/10/24/the_downside_of_high_tech_wages_venture_capital/ ] The economic trick is to for the public sector to use the boom wealth to diversify, something private money has no need of since it can merely re-deploy to profitable places. Ask the south Asian economies how fast capital can re-deploy. "The biggest problem innovative companies have is legitimacy," says Phil Anderson, director of the International Centre for Entrepreneurship at the Singapore campus of the Insead business school. "No company will succeed just by being better and cooler. They need to have a technology that solves a burning problem, one that makes customers whip out their checkbooks." [Kristi Essick, Wall Street Journal, Oct 24] And getting a customer to adopt your product sure beats pleading the government for another year of R&D support to keep the idea alive until some market awakens. And if the government were smart (please!), it would cut off long term life support for innovations as an incentive to either make something of it or look for some other line of work. A House Divided: Manufacturing In Crisis Gone are the days when U.S. manufacturers united to compete against the likes of Germany and Japan, pumping out high-quality goods under the protective shelter of the world's most vibrant economy. Today, amid liberalized trade and widely available cheap labor, manufacturers have turned against one another, threatening to topple a house built upon the pillars of ingenuity, productivity and competitiveness. ... While all manufacturers face the same lopsided trade policies, surging prices for raw materials and relentless competition from China and other low-cost markets, small manufacturers get squeezed the hardest. ... it is big versus small, especially when it comes down to where manufacturers stand on the U.S. government's trade policy, which often favors the big multinationals at the expense of the little guys [Doug Barthomolew, Industry Week, Nov 1 http://www.industryweek.com/ReadArticle.aspx?ArticleID=10849 ] Clarity Towards All. How to Make Your Business Plan the Perfect Pitch http://www.business2.com/b2/web/articles/0,17863,1096845,00.html The northern tip of Ireland is too cold, cloudy, and strewn with boulders to grow much of anything beyond Christmas trees, and the bogs are too soft to support cattle. But it does have wind, which a Dublin-based startup called Airtricity run day and night on a steady 16-knot breeze. Together the machines produce 12 megawatts of electricity, powering about 8,000 homes in the area. More important for the Herrons, they generate an annual royalty of roughly $55,000. And because of its unique wind characteristics, the property has appreciated as much as 100-fold, making the erstwhile shepherds multimillionaires. [Business 2.0, Aug 05 http://www.business2.com/b2/web/articles/0,17863,1083187,00.html ] Brains beat dollars. More isn't always better when it comes to
corporate spending on research and development, says Booz Allen who found the
companies that spent proportionately greater sums than their industry peers
didn't enjoy greater revenue gains or better profits. ... once a minimum level
of research and development spending is achieved, better oversight and
culture were more significant MIT Tech Review has a new feature Alarm:clock is a daily news site that evaluates privately-held technology startups in the areas of hardware, software, the Internet, and wireless communications. One industry overview and one company profile by alarm:clock's editors come to Technology Review every Wednesday by special arrangement. http://www.technologyreview.com/articles/05/10/wo/wo_101905burke.asp?trk=nl It's tempting to overstate the significance of all things Google, and it has been overstated, many times. We have seen much of this movie before -- the nearsighted geek outlining the technology-enabled, blue-skied future that's ineradicably linked with that geek's business. (Although it most plausibly starred Bill Gates, many other actors auditioned during the dot-com boom.) [Jon Fine, Business Week, Oct 24] Little is required to ensure political quiet in the American scientific community. A bit of annual growth in government outlays for research, presidential medal-pinning ceremonies in the Rose Garden for revered elders of the profession, and expressions of respect for science produce a wonderful tranquillising effect on the endless frontier. With rare exceptions, this combination has prevailed for most of the collaboration between science and government that began during World War Two. [Daniel Greenberg, London Review of Books, 9/2/05] America's technological gap is shrinking. American retains its innovative lead, and no country comes near America's quota of miracle startups and world-beating entrepreneurs. Yet China and India are churning out an army of well-educated scientists and engineers, and both countries are showing remarkable technological and entrepreneurial creativity. International testing confirms U.S. declines in math and science. A new OECD report shows the U.S. as eighth and ninth respectively in the share of its people between ages 25 and 34 who have college and high school diplomas. It was first and second by those measures 20 years ago. [Fred Kempe, Wall Street Journal, Oct 17] Patent War. Pay up in 30 days or face an expensive court battle, the letter not so subtly warned, adding that Clorox, Kellogg, Kodak, Gillette, BMW, Eli Lilly and other firms had all paid Solaia's licensing fees. ... Troll firms "have no assets. They don't innovate. They have no R&D. They have no activity to speak of other than writing letters and demanding large checks," said Paul McDowall of the Minnesota Intellectual Property Lawyers Association. [Dee DePass ddepass@startribune.com, Minneapolis Star Tribune, Sep 27] A group of Minnesota firms, led by General Mills, got together, put their nine in-house patent attorneys to work and went to court. the [MIT Tech Review] R&D Scorecard shows that worldwide corporate spending is picking up (Big Spenders), but that the gains are unevenly distributed (Where the Growth Is). The biggest advances are in the life sciences, which also happen to be among the most research-intensive industries (Innovation Sectors): 2004 R&D spending among the biotech companies on the list shot up by an average of 69% over the previous year. Several solar startups with innovative new technologies, including Nanosolar and Konarka, have recently received venture-capital funding. Miasol is looking to make solar power cost-effective by using thin-film manufacturing techniques, avoiding the expensive processing that silicon-based solar cells require. Miasol enjoys great buzz thanks to a $16M investment from the superstar VC firm Kleiner, Perkins. However, its competitor Nanosolar has also recently raised $20 million. It remains to be seen whether these new types of solar cells are generating investments based on the general promise of cleaner energy or whether they are commercially feasible technologies able to compete with existing and well-entrenched silicon-based photovoltaics. [MIT Tech Review, Sep 05] The majority of venture firms don't do that well. The bottom half generally don't make any money at all. So most investors try to put their money with the top 25 percent of performing funds. [Matt Marshall, Seattle Times, Sep 5] Despite economic uncertainties, corporate plans to increase spending on technology gear remain on course this year, with analysts saying such outlays in the U.S. will rise as much as 7% over 2004. [Donna Fuscaldo,Wall Street Journal, Aug 25] How much further can you push silicon's efficiency? Today's standard commercial module converts about 12 percent of the sun's energy into electricity. The record in a laboratory is 24.9 percent, so there's plenty of room for improvement. Our highest-performing commercial module today is 18 percent efficient, meaning roughly 50 percent more power for a given area than the industry standard. We've been able to put all the electrical contacts on the back of the cell, which eliminates what's known as shading. [Spencer Reiss, MIT Tech Review, Sep 05] [Greg] Kostello is one of a growing number of entrepreneurs who are experiencing first hand how much faster and cheaper launching a company is today, compared with even five years ago, thanks to the ever-decreasing cost of hardware and steady improvements in open-source software. [Eric Hellwig, MIT technologyreview.com, Aug 12] In our study of supply chain innovation, we found that only a small percentage of companies recognized their suppliers as a source of innovation, and even fewer bothered to measure their value. What's most perplexing about this myopia is that the innovation derived from the supply chain is typically the least costly and least risky investment, and often the fastest to market. [Business Week, Aug 22] The market for venture-backed companies jumped 46% to a four-year high in the second quarter, says Robert Weisman (Boston Globe , Aug 13). The 45 companies disclosing their purchase price in the first quarter were sold for a total of $4.2B. ... Nationally, about one-third of disclosed deals in the first half of this year returned more than four times the investment of venture capital firms and their limited partners, the new data show. Another third either recouped the investment or returned up to four times invested capital. In the last third, companies sold for less than the total venture investment. An $8 Threat. Logan International Airport is trying to block Their niche involves " lending money to some companies with no profits and no revenue. Durham, N.C.-based Square 1 Bank plans to serve VC firms and their companies. [Melissa Allison, Seattle Times, Aug 5]. "The battery that you're getting in your laptop today is about 20% more powerful than the battery you were getting three or four years ago," said Donald Sadoway, an MIT professor of materials chemistry and a specialist in battery design. So why do our laptops peter out midway through a coast-to-coast flight? Because the laptops keep getting faster processors and bigger color display screens, not to mention those DVD drives. "All of these new enhancements in computer performance are requiring greater performance from the batteries," Sadoway said. "It's almost like an arms race." [Hiawatha Bray, Boston Globe, Aug 3] The idea that innovation will ensure continued U.S. economic well-being is
open to challenge as scientific and technological skills build in countries such
as China and India, according to Harvard economist Richard Freeman. Large
increases in the number of scientists and engineers in More Chinese Competition. Early-stage
investors are plowing money into China, and often posting permanent staff here,
despite concerns about political instability, tight controls on capital and a
dearth of local management talent. U.S. financiers say huge domestic demand for
high-tech gadgets and sophisticated technical gear in China is hard to ignore,
particularly when it spawns genuine local innovation in fields such as
telecommunications and semiconductor design -- not just "me too" technologies
riffing off Western products. [Rebecca Buckman,Wall
Street Journal, Jul 28] Can the USG contribute to fostering capital
investment in domestic companies? Yes, of course. It could target its SBIR
handout at market-driven early stage technology companies who could be
investment candidates once some of the highest technical barriers are reduced to
manageable size. If you want to judge whther the USG is actually doing anything
like that, look at the list of projects funded by Navy and MDA, for example.
Project after project that only a government could love and that will draw
zero capital interest after Phase 2.
Incremental Hyperspectralism. With a single
30-minute flight, scientists can use hyperspectral-imaging equipment to produce
data that would take hundreds of field workers on foot weeks to assemble
... Hyperspectral imaging is far from new and has
been used for military and other purposes [Chelsea Deweese,Wall
Street Journal, Jul 28] A brand new idea that has been thoroughly tested -
the conservative dream. Just right for military SBIR to refine and improve with
little risk that anything startlingly new would be discovered. The Navy's recent
list of Phase 1 SBIRs has five competing hyperspectral projects. DOD's SBIR
database lists 250 SBIR awards since 1990 for hyperspectral anything with some
double-size Phase 2 awards. One ten-person company has hauled in about $6M of
hyperspectral SBIR, enough to explain to company's entire business. Have the DOD
companies had any noticeable economic return, say tax payments on profits in
this cottage industry, from all that "investment"? Who knows? Nobody
connected with SBIR seems to care, and every agency can find plenty of excuses
to avoid the question.
A decade ago, Netscape went public, blasting the Web into everyday life.
Wired Aug 05
http://www.wired.com/wired/archive/13.08/intro.html has an interesting
re-cap of those ten years.
Crank. Con artist. Blithering ignoramus. Dishonest hack bent on corrupting
the education system. The certain, usually too young to have much
sophistication, have no patience for opposing views. George Gilder
has had his opponents over his years of opining about society and technology
(The Microcosm). Now he's attracting brickbat for championing Intelligent Design,
the content-free idea that somewhere out there is an alternative theory to
evolution. [story by Joseph Kahn, Boston Globe, Jul 27
] Two Steps Forward, One Back? Less Is More, according to HP's new CEO as he plans to cut 10% of the company's lab force. It says it is it's shifting the focus of the labs toward projects that offer a higher potential for a return on investment which is code for shorter focus on immediate markets. The future? Maybe that's why CEO Hurd couldn't resuscitate NCR in his last job. Satisfying current customers risks becoming obsolete when your competitors innovate around you. Get Creative! How to build innovative companies. Top innovators: 3M, Apple, Microsoft. Organizing for Commodity Business. Even in a growing economy
with a recovering technology sector, high-tech companies from What's the Next Big Thing in Technology? The Winners: Flat-Panel Televisions: Mobile Email: Business Intelligence Software: Satellite Radio. The Losers: Fiber to the Home: The Digital Home: Radio Frequency Identification: WiMax. [Eric Savitz, Smart Money, Jul 24] Fewer Americans are earning doctoral degrees in science and engineering,...
American governmental spending on R&D in the physical sciences, math and
engineering has slipped from 0.25% of the gross domestic product (GDP)
in 1970 to 0.16% in 2003, according to the Alliance for Science &
Technology Research in America (ASTRA). Meanwhile, China is steaming in the
opposite direction. China nearly doubled its output of science and engineering
Ph.D.s between 1996 and 2001, ... And in the six years between 1997 and 2002,
national and local governmental spending on research in China doubled, to
approximately $9.9B. On top of that, multinational corporations have
been racing to set up research centers in the country and China's own
industrial titans are now plunging into R&D, realizing they have to have
their own technology to compete in global markets. [Randall Parker,
futurepundit.com] Should the USG do anything about it? Well, maybe. One
thing it might do to get more innovation for the tax dollar spent is target
SBIR (a mere $1B a year) to companies with both entrepreneurial spirit and
technology with future market potential. For two decades the agencies have
been allowed to fund whatever they please, and they do not please to look to
any goals except their own R&D programs. Want to do more than slurp up
SBIR money? Get involved in efforts like The
Task Force on the Future of American Innovation. MUMBAI, India--One of the critical ingredients for the $100 computer is
probably in your garage. In about three months, a little-known
company called Novatium plans to offer a stripped-down home computer for about
$70 or $75. That is about half the price of the standard "thin
clients" of this kind now sold in India,
made possible in part by some novel engineering choices. Adding a monitor
doubles the price to $150, but the company will offer used displays to keep the
cost down. [Michael
Kanellos, CNETnews.com, Jun 29]
Profits Without Jobs. In the last three years, profits at the
seven largest companies in Silicon Valley by market value have increased by an
average of more than 500 percent while Santa Clara County employment has
declined to 767,600, from 787,200. ... just as low-skilled manufacturing jobs
fled the region starting in the 1970's, now software jobs are also
leaving. [John Markoff and Matt Richtel, New York Times, Jul 3]
Politicians will need something to assuage the people without jobs who vote,.
Profits which do not vote are only good for shareholders which the unemployed
won't be for long. German automaker Volkswagen recently offered a peek behind the locked
doors of its Palo Alto lab.Inside, engineers are creating dashboard instrument
panels that change on command to instantly offer needed information. They're
perfecting auto glass that goes from clear to dark in two seconds. They're
working with local companies like Palm to connect smart-phones to the car via
Bluetooth to allow drivers to make calls using verbal commands or the car's
buttons. And those are only the projects they can talk about. ``The basic idea
is to bring the Silicon Valley to Volkswagen,'' said Carlo Rummel, executive
director of Volkswagen of America's Electronics Research Laboratory. That's why
his lab is full of local hires, not German engineers shipped in on
temporary assignments. [Matt Haumann, San Jose Mercury News, Jun 27] from the no-thinking-zone dept.
Daniel Dvorkin
writes "A New Scientist article details the claims of Jonathan Huebner,
a Naval Air Warfare Center physicist, that the
rate of technological innovation is actually decreasing, not increasing
exponentially as some people believe. Huebner says that there are now fewer
'important technological developments per billion people' than at any time since
the 17th century! I'm far from convinced, but it's an interesting and
thought-provoking article." From the article: "He says the rate
of technological innovation reached a peak a century ago and has been declining
ever since. And like the lookout on the Titanic who spotted the fateful iceberg,
Huebner sees the end of innovation looming dead ahead." [slashdot,
July 2] The usual optimists throw the usual stones at pessimism. Actually, why
is it pessimistic to say that any given rate of innovation must continue or accelerate
in response to gazillions of R&D money thrown at scientists and engineers by
taxpayers? One driver is the constant political demand for real economic growth
and the idea that per capita GNP must continually accelerate What
disaster, other than unemployed scientists, would happen if the taxpayers
stopped cranking the S&T employment machine and let our revered capitalism
work its magic? Killer Instinct writes "Ever
wonder how
ice melts? Until now, scientists could not explain why ice cubes in your
drink melt. They've known the basics, but the details remained elusive. A
breakthrough new study, announced yesterday, supports a leading theory that
melting starts when the fundamental structure of matter begins to crack. Melting
is considered a basic phenomenon in physics. An understanding of how it works is
crucial to gaining a firm grasp on the physical world." [slashdot,
July 2] Blog Away Smartly. You can start your own blog for free with www.Blogger.com
to reach the other 50M regular blog readers. But, a few warnings: don't trust
everything you read in blogs; no blogs wherein you trash the company you work
for or your boss. [story Houston Chronicle, Jul 4] . "Imagine that you're a company with a copyright and you see a company
coming out with a technology you don't like because it's challenging your
business model," ... a second way to stop the innovation is just
to litigate. Look what happened to ReplayTV: I... it had to fold the company
because the legal standard then was so uncertain that you had to get to trial
before you could resolve the case. ... What you're going to see is
innovation that's channeled in ways the copyright owners can agree to, or
channeled in ways that avoid any kind of possibility of this kind of litigation.
That has already had its effect in the Valley, and already money has shifted
into places which will avoid any conflict with the copyright holders. Why buy a
lawsuit when you can buy a new innovation that doesn't get you a lawsuit? [siliconvalley.com,
Jun 30]
watch the attitude of capital and the grown-ups who used it. ... The
sheer consistency of its behavior - it never does anything but seek the highest
return ... If capital is moving in some new direction, it is because financial
incentives, not capital, have changed.... [During and after the 90s IT
boom] The smartest capitalists were no longer the ones who did the big
deals with established companies on Wall Street. They were the ones who did
little deals with the companies that threatened the established companies. [Michael
Lewis, Next : the future just happened, 2001]
In "The Flight of the Creative Class," [Richard] Florida
revisits the idea that a community's economic health is dependent on the three
T's -- technology, tolerance and talent. On a scale dubbed the Creative Index,
which measures a community's creative economic strength and potential, the Twin
Cities rank 10th. [Jim Buchta, Minneapolis Star Tribune, Jun 27]
Some basic research surprises. what kind of basic research have gotten the big increases over
the past three decades or so? I used NSF data
adjusted for inflation
the combination of venture capitalists favoring later-stage startups and the continuing trend of large corporations investing less in speculative research is creating an innovation vacuum, according to some experts. "The effects are pretty ghastly," says Lita Nelsen, director of MIT’s Technology Licensing Office. "Large corporations have become less and less invested in early-stage research. They buy it from little companies. And if there’s nobody to get the little companies started, we’re getting it at both ends." But despite the hazards of the game, " venture capital is still a way to make enormous riches," says Josh Lerner, a professor of investment banking at the Harvard Business School. Still, there's never enough money. But where will the next generation of innovative technologies come from? No one should forget that the search technology behind Google was developed by Sergey Brin and Larry Page as part of an NSF-funded Stanford University digital-library project. [MIT Tech Review, Mar 05] DDT, CFCs, asbestos, leaded gasoline ... and nanomaterials ... bring various unintended consequences of initially promising technologies, notes Fred Krupp and Chad Holiday (WSJ, Jun 14). We need to make sure this assessment takes place now for today's "next big thing" -- nanotechnology. With the right mix of voluntary corporate leadership, coordinated research, and informed regulation, we can reap the benefits of this promising technology while reducing the likelihood of unintended consequences. Companies doing nanotech might take extraordinary precautions with the materials. So that impending downturn in the semiconductor industry we've heard so much about during the past few months? Probably not gonna happen, say the folks at the Semiconductor Industry Association (SIA). This year, at least. The SIA on Wednesday reversed its previously pessimistic forecast, saying the global chip business is expected to grow 6 percent this year. It now estimates that the industry will see $226 billion in revenues in 2005. The trade organization last November had predicted a flat year and sales of $213 billion. "The market is getting stronger," said SIA President George Scalise. "We have a forecast that says we are going to have a very good year and two or three more ahead." What's driving the SIA's newly discovered optimism? Stronger demand for cellular telephones, personal computers, digital televisions and digital cameras. [JOHN PACZKOWSKI, Silicon Valley.com, Jun 9] And how much longer can people buy cellphones and other digital toys with equity loans on inflated house prices? When will the music end? Not Enough to Read? Technorati tracks just over 11 million blogs worldwide, but the actual number of bloggers is probably much lower, given that many people maintain multiple blogs under a single blog hosting account, or have blogs at several locations such as LiveJournal, TypePad, and Blogger. My blog count of three doesn't even include the pseudo-blogs that go along with my accounts at places like Bloglines and Wallop. [Wade Roush, MIT Tech Review, Jun 8] The Six Million Dollar Man was overpriced. Slap in a Medtronic implantable heart monitor, Parkinson's-busting neural stimulator, spinal fixator, and blood-sugar sensor, and you're probably under a million, all-in. Headquartered in Minneapolis, Medtronic is at the forefront of extending human physiology through technology, with sidelines in image-guided surgery systems, defibrillators, and the like. A heady 18% growth rate led to 2004 sales approaching $10B, of which nearly 22% was profit. The posthuman gold rush is on. Challenge: Get back to being the first responder. Medtronic ceded that position behind competitors Boston Scientific and Johnson & Johnson in developing drug-coated stents used to prop open arteries. Opportunity: Get people hooked up to the Internet - literally. A national health information network that gathers real-time data from devices in patients' bodies could change medicine forever. [Wired, May 05] Behold the disruptive innovation! An entire industry can putter along for decades, steadily improving its products, services, and bottom line - only to be suddenly eviscerated by people from nowhere using simple, inexpensive, profoundly powerful techniques....HBS guru Clayton M. Christensen has described this theory of industrial extinction in several books. ... I searched for the stupidest, most dysfunctional US industry I could find. ... Health care has every quality Christensen lists as dangerous: crippling regulation, overcharged customers, enraged victims with deep grudges, unnecessary goods and services, and a massive base of underserved wretches. ... [Bruce Sterling, Wired, May 05] Great Hope, Great Wait. Since researchers first mixed together genes from two species more than a quarter century ago, biotechnology companies have promised to revolutionize the pharmaceutical industry ... The biotechnology industry lost a combined $6.4B last year ... The industry's total accrued loss since its birth in Silicon Valley in the mid-1970s is more than $45B. ... [Peter Drucker once observed that the computer industry never made money as an industry.] A handful of biotechnology companies have indeed hit it big after modest beginnings, making their initial investors wealthy. ... "It's a crazy industry to invest in," said John McCamant, a biotechnology investor ... Biotechnology remains a money-losing, niche industry of 1,400 companies that employ about 183,000 workers nationwide. By contrast, Wal-Mart employs 1.7M workers itself and its annual revenues rival the entire biotech industry's annual sales. ... [Paul Elias, MIT Tech Review, June 1] Someday, some will get rich. In the meanwhile, innovative companies will continue to live off someone else's money to pay for the interesting science work. Big Money for Small Stuff. Nanotechnology research and development funding almost doubled to more than $10B in 2004 from the previous year. Most of the increase was driven by a big jump in corporate and private funding, which grew by 160%, while government and academic research outlays on nanotech R&D increased by a vigorous, but less outstanding, 37%. Japan led the way, with expenditures approaching $4B; the United States, however, was not far behind, with spending of about $3.4B. [Stacy Lawrence, MIT Tech Review, June 05] Toronto, Helsinki, and Melbourne. the themes of [Prof Richard] Florida's latest book, ''The Flight of the Creative Class: The New Global Competition for Talent", which contends the United States is about to lose the race for the world's best talent. The reason: Our open society, which has allowed people and ideas from all over to flourish, is closing under post-9/11 immigration policies and an intolerant Christian right. ... rising cosmopolitan cities, like Toronto, Helsinki, and Melbourne, Australia, are poised to snatch this talent away [Robert Gavin's review, Boston Globe, May 22] Gavin finds Florida's thesis filled with specious arguments and overly reliant on anecdotes. 'brain drain" into the US has been slowed by recent immigration/terrorism fears but religious right interference with science is probably limited to the Bible belt red states which were never leaders in US science and technology anyway. The distribution of government open competition R&D funds gives one clue where the creative talent lies - in the blue states of open discourse and civil liberties. Michael J. Ross writes ... U.S. IT managers are struggling with reduced budgets. Yet apparently many believe that the sector will regain its past glory and blistering growth rates. According to experienced IT consultant Erik Keller, it's not going to happen. He presents his case in Technology Paradise Lost, published by Manning Publications, whose user group representative kindly provided me with a copy of the book for review." the rest of Ross's review. [slashdot, May 19] Walter Hewlett was right. Just about everything that made HP a giant came not from its mainstream businesses, but from those "hobby" projects that turned out to be world-beaters: LEDs, desktops, scientific and business calculators, minicomputers, printers -- even employee Steve Wozniak's little "hobby" that temporarily got away, the PC. If HP can't keep those projects in-house, then, as Dave Packard did, it should give the teams some money, send them off, and buy their businesses back when they have something great to show. ... For 60 years, HP was synonymous with the highest quality, service and integrity. These days, when people think of HP what comes to mind is a corporate soap opera, forgettable PCs, and flimsy plastic printers. HP calculators, because of their durability, were once the dream of every college kid. Today? The last description I heard of an HP printer was . . . (sorry, this is a family newspaper). [Michael Malone, Wall Street Journal, May 19] Malone also says buy Agilent because the spin-off child kept the HP way as the parent lost it. Partly inspired by California's energy crisis -- and the fact that Mr. Rodgers had spent $1 million after subsidies to install a solar panel on the roof of Cypress's headquarters -- he wrote Mr. Swanson a personal check for $750,000. "I thought the time for solar had happened," recalls Mr. Rodgers. [Jim Carlton, Wall Street Journal, May 19] Has your company got the kind of story that will convince other TJ Rodgerses to open their checkbooks. If not, why not? Do you know anyone who could write such a check? Or do you spend your time schmoozing government technocrats for another R&D service contract? Among the definitions from The Devil's Dictionary by Ambrose Bierce: Tariff - A scale of taxes on imports, designed to protect the domestic producer against the greed of his consumer. ..... Achieving free trade is like getting to heaven. Everyone one wants to get there, but not too soon. [borrowed from the Adam Smith Institute] How Much Longer? Since 1990, income for the median American household has risen only 11% after adjusting for inflation, while median household spending has jumped at 30%, according to an analysis by Economy.com. How could the typical family afford to spend so much? Median household debt outstanding leaped by 80%. [Bob Davis, Wall Street Journal, May 17] If you are developing, or hope to develop, something that can be sold in quantity, you have to be concerned with how long the consumer can afford to keep buying at the rate your market studies project. If consumers slow buying, manufacturers slow making. As [Mike] Ciminera sees it, the entrepreneurial role in the aerospace industry can develop in several ways. Sometimes, technology innovation leads to pivotal demonstrations that result in government's issuing requirements for a new system. The key is to let individuals or small teams run as fast as they can with adequate funding to create technological change. Mike is a classmate from eons ago who then spent 40 years with Grumman. The idea of encouraging innovation was the rationalization that the SBIR inventors used to get an an arbitrary allotment of government R&D spending. Unfortunately, the government mostly ignored Mike's advice as it got enmeshed in procurement procedures that suited a bureaucracy. Then it compounded the error by shunting small high tech ideas from open competition into SBIR where the procedural rules took needless precedence over search for and exploitation of interesting new ideas. In the interest of program standardization, mediocre ideas got too much money and great ideas got too little. The Semiconductor Industry Association predicts zero growth this year and the big capital spending splash in 2004 means excess capacity after another 12% rise while PC and cellphone growth slow. [Eric Savitz, Smart Money, May 05] When everyone already has one, growth depends on their throwing them away to buy new ones for whatever reason. the fiber glut is as bad as ever. researchers estimate that about 85% of the fiber lines in the ground in the U.S. still are "dark," . Even the fiber that is being used isn't close to having its full capacity exploited. In fact, less than 5% of the total transmission capacity of all the fiber lines is being put to use .... some of the fiber-optic network companies have continued to operate instead of going away Meanwhile, technological advances keep boosting the capacity of the fiber that already is in use. And while millions of Americans now have high-speed Internet connections and use bandwidth-hungry applications such as online video, no new data-heavy "killer application" has arisen to sop up the excess capacity of those high-tech lines. [Shawn Young, Wall Street Journal, May 12] "Nothing happens until somebody sells something" attributed to "Red" Motley who began his career selling manure in Minnesota, says Paul Sturm (Smart Money, Apr 05) That rule does not mean that companies who sell R&D services to the government in sheltered programs like SBIR are getting anywhere. Stories Were Too Good to be True? SiliconEntity writes "Wired Online has been forced to correct dozens of stories in the wake of disclosures that reporter Michelle Delio may have fabricated quotes. Wired has published over 700 stories by Delio since 2000, and in a review of 160 of the most recent ones, 24 were found to have quotes that could not be confirmed. Several of the Wired stories being questioned were discussed on Slashdot, including Spyware on My Machine? So What?, Minniapple's Mini Radio Stations, The Masters of Memory Lane, and probably many more. Wired is not the only one to get burned; MIT Technology Review and InfoWorld have also had to retract or alter stories written by Delio." [slashdot, May 10] Let me guess: Your idea is the best thing since sliced bread. When Otto Rohwedder dreamed up the idea of selling sliced bread in 1912, however, all he got was a lot of carping and naysaying. How difficult was it to slice bread? And everyone knew that bread, even loaves of it, got stale quickly; in slices, it would spoil in a matter of minutes. It took Mr. Rohwedder, a jeweler by trade, 16 years to produce a machine that could both slice and package the bread to prevent it from being exposed to air. Then he had to beg a Missouri baker to offer it for sale. [Cynthia Crossen, Wall Street Journal, May 9] Revolutions Come Slowly. "What worries me is, where is the gold rush?" asks Grant. At best, he says, utilities are lukewarm in their interest in HTS products. Several times in the past, Grant argues, electric utilities have backed off even from new technologies that were widely expected to cost less in the long run. "You're dealing with an industry that is very lethargic and doesn't adopt new technology very easily," he says. Daley agrees: "We're dealing with a regulated industry. It's not as easy for them to make investments [in new technology]." [Robert Service (not the Yukon poet), Science, Apr 15] 100 times the current at 100 times the price, plus the risk of new technology also makes a big barrier. The SBIR and other government plunge into HTSC in the late 80s has not yet produced a revolution. Tech Transfer Opportunity. Microsoft is opening its research vault for the first time to venture capitalists and entrepreneurs, starting a program to transfer some internally developed technology to small companies in exchange for royalties or ownership stakes. The move is part of a broader bid by Microsoft to better capitalize on its $7 billion research-and-development budget. [Todd Bishop and John Cook, Seattle Post-Intelligencer, May 5] a remarkable steo for Microsoft, which has long hoarded its intellectual property. "Suddenly it becomes, 'Do I go to Sand Hill Road, or do I go to Redmond?' '' Richard Doherty, research director of the Envisioneering Group, told the Mercury News. "We think they have opened up the floodgates.'' [siliconvalley.com, May 5] But remember one rule of venturing: it's better to have second-rate technology and first-rate management than vice-versa. [Intel] CFO Andy Bryant told Bloomberg News that chip demand is so high at the moment that they can barely keep up. [San Jose Mercury News, May 5] Should be great news for SBIR companies that have actual useful semiconductor process products, like ATMI (in whatever form it finds itself after selling some of its businesses). High tech can be a great business. The Six Million Dollar Man was overpriced. Slap in a Medtronic implantable heart monitor, Parkinson's-busting neural stimulator, spinal fixator, and blood-sugar sensor, and you're probably under a million, all-in. Headquartered in Switzerland and Japan, Medtronic is at the forefront of extending human physiology through technology, with sidelines in image-guided surgery systems, defibrillators, and the like. A heady 18 percent growth rate led to 2004 sales approaching $10 billion, of which nearly 22 percent was profit. The posthuman gold rush is on. [Wired, May 05] What is the government doing with its SBIR to nurse more Medtronics into competitive life? Why should anyone expect the government to know how to nurse infant Medtronics? The government knows how to have meetings, invade foreign countries, and pass out money to all and sundry voters and contributors. Capitalism builds companies. One wonders for whom these hapless souls blog. Why do they choose to expose their unremarkable opinions, sententious drivel and unedifying private lives to the potential gaze of total strangers? What prompts this particular kind of digital exhibitionism? The present generation of bloggers seems to imagine that such crassly egotistical behavior is socially acceptable and that time-honored editorial and filtering functions have no place in cyberspace. Undoubtedly, these are the same individuals who believe that the free-for-all, communitarian approach of Wikipedia is the way forward. Librarians, of course, know better. -- -Indiana University Dean and Rudy Professor of Information Science Blaise Cronin [silicon valley.com, May 4] Research, particularly in the physical sciences and engineering, is the foundation of our innovative economy. It has spawned the transistor, fiber optics, integrated circuits, wireless communication, liquid crystal displays, lasers, the Web, the GPS, hybrid automobiles and medical technologies far too numerous to list. With these new technologies have come new, high-wage jobs. MIT alone -- faculty, alumni and staff -- has created 5,000 companies in the last 50 years. When an innovation is found, the U.S. entrepreneurial spirit is quick to develop, produce and market it, creating new jobs and revenue. [Norm Augustine & Burton Richter, Wall Street Journal, May 4] George Gilder's "The Silicon Eye" (Atlas Books) traces the history of [Glenn Reynolds, Wall Street Journal, May 3] Reynolds has a second life beyond law professor as the well-known blogger InstaPundit "Ever wonder why Michael Faraday, steam engines, Ezra Cornell, the Van de Beurses family and the Edison Effect were so important to today's computer business. Andy Kessler has a free download of a PDF of his new book, How We Got Here: A Slightly Irreverent History of Technology and Markets. It's a James Burke-style connect-the-dots of events and people from 1642 to this morning. Kessler's site takes you through a "poor man's DRM" process to get your very own PDF." Yeah, yeah - DRM. But the PDF/book is worth reading for understanding the history to tech. [slashdot, May 2] Disclaimer: I have not yet read it. a major undercover investigation of stolen computer hardware and software in Silicon Valley, recovered $480 million in property and put nine people behind bars ... undercover agents posed as brokers in a seamy underworld of illicit computer wholesalers, authorities said. Sometimes the line was blurred between legitimate business and illegal activity in the so-called gray market for technology goods, they said [Karl Schoenberger, San Jose Mercury News, Apr 30] Commoditization of Technology. Carr hasn't backed off from his assertion that information technology is becoming a commodity. In a new article, appearing in the spring issue of MIT Sloan Management Review, he contends that corporate data centers -- founts of technology-driven strategy in the 1990s -- soon may disappear. In their place, Carr argues in ''The End of Corporate Computing," will be large-scale utilities that will sell information technology services to businesses -- much as central electrical generating stations supplanted the water wheels and individual generators that powered manufacturing plants a century ago. [Robert Weisman, Boston Globe, May 1] Nobody ever got fired for buying IBM. But IBM said it had difficulty closing deals at the end of the quarter, a sign that big tech companies are having a harder time selling to corporate clients. [Wall Street Journal, Apr 14] Such buyer reluctance can't be good for small firms either. Got a great new LCD idea? It better be cheap. Market research firm Displaysearch expects manufacturing costs for LCD panels to drop by 62 percent in the next four years. Count in the natural price erosion in the industry and $100 17-inch displays suddenly appear on the horizon. [Wolfgang Gruener, Tom's Hardware Guide, Apr 13] T.J. Rodgers, CEO of Cypress Semiconductor, is a die-hard free-market libertarian whom you wouldn't expect to be an environmentalist. But now that a Cypress division has figured out a way to deliver cheap electric power with silicon-based solar cells, Rodgers doesn't mind saying that he's as green as they come. [Dean Takahashi, San Jose Mercury News, Apr 2] Actually, libertarians do not oppose environmental protection. They merely oppose government methods that impose dirigiste solutions when workable market solutions are available. Hundreds of small public companies are leaving the stock markets, which can leave shareholders in the dark about the firms' financial health. The trend has picked up since Congress toughened rules in 2002, amid corporate accounting scandals. "Dark" firms remain public but delist from an exchange or market and no longer file quarterly and annual reports with the SEC. [Judith Burns, Dow Jones, Apr 3]. Owning stock in dark firms is a gamble best left to insiders who know the truth of the company's economic situations The fundamental outlook for technology as a whole has improved slightly since the beginning of the year. After a robust 2004, growth prospects remain modest in key end markets like corporate information technology (IT), consumer electronics and personal computers, and we've made only minor changes to our forecasts. [SG Cowen (broker), Barron's, Mar 31] Everyone Sh | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
