I was reading Steven Cherry’s blog last week “If There’s an Innovation Gap, Where is it?” since this is a subject of particular interest to me following the sometimes herky-jerky development of nanotech.
After reading the ensuing comments today, I have to say I come squarely down on the side of Vivek Wadhwa of UC-Berkeley. A lot of money has gone into basic research in recent years and in the last half century as well with a lot of results—they just don’t ever make it into commercial markets.If the question is “Why don’t we have more innovation?” I am hard pressed to believe that the answer is a lack of basic research. I can read reams of daily reports on basic research in nanotech. But I have a hard time of thinking of more than a handful of companies that have introduced successfully nano-enabled products. Where is the disconnect? It clearly seems to be in getting those lab results into prototypes and from prototypes into products. Judy Estrin may indeed be correct in her assessment that the blame can be placed, at least partially, upon big businesses’ lack of foresight. But perhaps not in the way she argues, which involves its turning away from research that might not be efficient towards the bottom line. I think their shortsightedness is more intentional and has been adopted to squeeze the last bit of profit from already existing technologies before tossing them aside for new innovations.
The drive for short-term profits is indeed an obstacle to innovation, but not because money has been diverted away from basic research; instead it seems to be so that the companies will not have to take on the capital costs of bringing that innovation to market.
Of course, if an innovation is more than incremental, it should be able to recoup those capital costs pretty quickly and certainly be worth the investment. But when success is measured quarterly there is hardly any time for any innovation to be more than red ink on a balance sheet.
Eventually someone will make the capital investment when a real opportunity is recognized, and those who passed on those opportunities content to rake in their quarterly earnings figures will be forced to innovate or die. But until then we will see a lot of hand sitting.
Dexter Johnson is a contributing editor at IEEE Spectrum, with a focus on nanotechnology.