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Emerging Technology Report #24: September 19, 2002

Albany Symposium on Global Business Issues in Semiconductors and Nanotechnology

- Summary -

Global Emerging Technology Institute

Nanotech has grasped the attention of government policy makers and corporate planners the world over, leading to a proliferation of industry conferences over the past two years. According to attendees at the Albany Symposium on Global Business Issues in Semiconductors and Nanotechnology, which was recently held in New York, the wide scope of nanotech will make commercialization a somewhat difficult and perhaps long process. Speakers and attendees at the conference expressed a belief that the government and large industry players will provide most of the support and be responsible for a lot of the innovation and pending research breakthroughs in the area.

There is a concern in regard to how long will it take for nanotech to live up to the hype it has received. Nanotechnology is a nebulous concept that is "cross-industrial", that is, it is expected to have an impact on a large number of industries. NASA believes that the convergence of nanotech, biotechnology and information will provide unprecedented benefits and solutions for the challenges it faces in the next century. The inter-disciplinary nature of nanotech and the broad application across industrial sectors presents a big challenge for the public and private sectors. It is hoped that long-term co-operation between the two will lead to breakthroughs in nanotech related research that will lead to the development of entirely new industries and markets in the future. Nanotech is already an enabling technology in the development of such products as cosmetics. However, its potential as a truly disruptive technology may take some time to be realized. Dr. Steven Walsh, the founding president of the Micro and Nanotechnology Commercialization Educational Foundation (MANCEF), told attendees at the Albany Symposium that it takes 18 years for a disruptive technology to go from invention to innovation. As an example of the time frame, Walsh cited the case of pressure sensors, which were discovered in 1954, but full commercialization didn't take place until 1990.

In order for nanotech to grow and achieve its perceived potential, it will be very important to develop a "road map" in order to attempt to measure the commercial feasibility of a nanotech innovation developed in a laboratory. The inter-disciplinary and cross-industrial nature of nanotech, as previously mentioned, will make this task a challenge. Unlike most technologies, nanotech has no real front-end or back-end technology. Rather, it has as many as 17 different front-end technologies Dr. Walsh has identified, and they are mostly complementary. This translates into a challenge to devise key platform nanotechnologies. A believable road map, bolstered by at least one platform technology, is crucial in regard to maintaining and increasing continued government support that is followed by an equally strong vote of confidence from the private sector in the form of substantial investment in nanotech-related R&D.

The U.S. government has clearly recognized the value of working closely with the private sector in order to facilitate sustained investment. The government, through it National Nanotechnology Initiative, has supported the creation of a balanced infrastructure for nanoscale science, engineering, technology and human resource training. This support has helped to indirectly reduce risk to the private sector, as has been the case in the past. The subsidization of such an infrastructure is absolutely necessary if the U.S., or any country for that matter, plans to be a source of innovation in nanotech. Nanotech is in such an early stage of development, and continued government support will be required in order for the private sector to safely enter the area and then, after a period of time, aggressively develop it. Even though a great deal of nanotech research is on the basic research level, private sector interest is growing rapidly. Nanotech will have a huge impact on the development of next-generation building materials, electronics, and magnetics, healthcare, energy and space travel. These are just a few of the areas that are receiving some of the greatest federal support in the basic research area. The government plans to quickly support applied research that will lead to commercialization. Commercialization is a primary goal in the promotion of university-industry-national laboratory partnerships.

It was emphasized during the conference that innovation requires money. The investment community should on how much risk has already been absorbed by the public sector and university research environment. That is, how many federal dollars have been earmarked for research where the viability of commercialization is highest. For example, a great deal of government funding and university research is in biosystems. As a result, it can be expected that nanotechnology and microelectronics will have a tremendously large impact on the pharmaceutical and biotechnology sectors perhaps in the very near future. Commercialization, of course, requires money, either through venture capital funding or industrial investment. In the United States, Walsh said there are some positive signs in the VC arena, but more money was returned to investors in the second quarter of 2002 than was raised. VC's will be very careful when venturing into the nanotech area, as there still is a great deal to learn on the part of the investment managers. Though large companies are more interested now in order to make sure they keep up with the potential of nanotech, they have a tendency to "gatekeep" new technologies, according to Dr. Walsh. This leads to inefficiencies in terms of commercialization, so perhaps there is room for innovative, adept smaller firms.

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