Wednesday, April 12, 2006

Last of four parts

LOWELL, Mass. — Konarka, an American company named for a Hindu temple dedicated to a sun god, is balancing a new line of products on the edge of science and manufacturing technology.

The company’s “power plastic” offers something along the lines of a flexible solar fabric that uses indoor or outdoor light to fuel products as small as a cell phone or as hefty as a vehicle.

“Our concept is to take light in and put electrons out,” said Daniel McGahn, executive vice president and chief marketing officer of the five-year-old company. “We feel we are at the cusp of manufacturing and science.”

Such innovation is a key to U.S. competitiveness in a global economy with old rivals and upstarts vying to generate the best jobs and the most technologically advanced products. U.S. universities and companies are world leaders at creating tomorrow’s products, although that advantage is not guaranteed and may well be eroding.

In this four-part series, The Washington Times looks at the past, present and future of products made in the U.S. Today’s article examines the cutting-edge innovation necessary to maintain the country as one of the world’s leading economies.

Ideas power U.S. economy

Konarka is based at a 19th-century textile mill in a city touted as one of the cradles of America’s industrial revolution. The downtown hollowed out as the factories shut down, moving steadily south to newer plants and cheaper labor during the first half of the 20th century.

Today, Lowell, still crossed by industrial canals, has turned the old brick factories into museums, condominiums or corporate offices.

Konarka acknowledges the city’s industrial past — it occupies a small space inside the old Boott Mills, built in 1836 to weave southern cotton into fabrics. But there is little nostalgia for the past at the company.

“It happens with every technology — products become commodities and someone else can make it cheaper. But it’s the engine that matters in the U.S., the generation of ideas that leads to success,” Mr. McGahn said.

Konarka uses photovoltaic nanotechnology to make material with properties similar to an ink — composed of particles 1,000 times smaller than the diameter of a human hair — that can be applied to plastic or fibers. The material absorbs light, and emits electricity, particularly well because the minute size of the particles means more surface area is exposed to sunlight.

The power plastic is not yet mass-produced and available for consumers. Mr. McGahn said that will happen this decade.

Konarka closely guards the status of negotiations with companies that may adopt, mass-produce and mass-market the technology. But likely candidates include major investors such as San Ramon, Calif., oil and gas company Chevron; Kingsport,Tenn., chemical manufacturer Eastman Chemical Co.; and Europe’s largest utility, Electricite de France.

esearch is key

Sukant Tripathy, now deceased, developed the material at the University of Massachusetts at Lowell under a Defense Department grant.

Such federal funding, coupled with collaboration among leading universities and entrepreneurs, is critical to the U.S. industrial base — and has made areas around Boston, California’s Silicon Valley and North Carolina’s Research Triangle launching pads for startups trying to cash in on the latest technologies developed in the world’s premier university labs.

The schools offer intellectual talent, laboratory equipment and a population of scholars otherwise unaffordable for small companies trying to incubate an idea, attract venture capital and introduce a product.

“I would say in the scheme of things it is pretty important. Not all work that is done in universities that is good science is going to make it as a commercial technology. But the work that goes in that direction it is important,” said Daniel Sandman, a chemistry professor and associate director of the Lowell university’s Center for Advanced Materials, the intellectual birthplace of Konarka’s nanomaterial.

And the work gives U.S. businesses a leg up on the rest of the world.

“I think, in general, it is accurate to say at the present time American science and technology is the best because our universities are the best. But this is a position that has to be maintained. There is competition all over the world,” Mr. Sandman said.

Race to the top

Many leaders in academia, manufacturing and politics echo Mr. Sandman’s assessment and amplify his concerns.

“The building blocks of our economic leadership are wearing away. The challenges that America faces are immense,” said Norman R. Augustine, former Lockheed Martin chief executive and now chairman of a National Academy of Sciences committee created to look at U.S. economic, scientific and technological leadership.

President Bush, in his State of the Union address in January, acknowledged the importance of scientific innovation when he announced an American Competitiveness Initiative. It would double federal spending on basic research programs in the physical sciences during the next 10 years.

The ultimate goal of innovation is to create new, quality jobs by developing industries that stem from scientific and engineering breakthroughs. Biotechnology, nanotechnology, advanced computing, robotics and energy all are fields in which the next generation of technology may transform the way people live, give rise to new companies, create jobs and expand wealth.

Riding new fields to economic prosperity is something the U.S. traditionally has done well and continues to do well. Others have taken notice and are copying the U.S. model, adapting it to larger population bases and lower wage scales.

China and India, for example, are working to develop university curriculums that keeps the countries’ best and brightest students at home, rather than watching them study in the U.S. or Europe. As the countries become wealthier, they will be better able to keep their top science and engineering talent for ongoing research and product development.

“The new element in the world is how rapidly countries such as China and India are racing to climb up the technology ladder. We must recognize that there is a race going on and that we have to run faster if we are to maintain our standard of living and our global leadership,” said John Engler, president of the National Association of Manufacturers, at a December National Summit on Competitiveness.

The summit, and a subsequent report, drew attention to trends in education and research that show the U.S. is squandering its economic leadership.

• Asia spends as much on nanotechnology, the science underlying products such as Konarka’s power plastic, as the United States does.

• Foreign-owned companies and foreign-born inventors now account for nearly half of all U.S. patents.

• U.S. 12th-grade students perform below the international average of 21 countries on a test of general knowledge of mathematics and science.

Mr. Augustine, in October testimony to Congress, noted that American industry spends more on litigation than on research and development.

The Council on Competitiveness, a forum for industrial, university and labor leaders; the National Academies; and the innovation summit recommended a series of steps to make America more competitive.

They include recruiting and training a higher caliber of teachers at public schools; focusing funding on basic scientific research; increasing government-backed training for scientists and engineers; attracting the best and brightest from overseas; and creating incentives for companies to fund research and development.

Sen. John Ensign, Nevada Republican, and Sen. Joe Lieberman, Connecticut Democrat, in December introduced legislation that follows up on the recommendations.

The legislation would, for example, by 2011 double funding at the National Science Foundation, which supports basic research conducted at American colleges and universities, and redirect other federal money toward high-risk research — the kind that has led to some dead ends but also to major breakthroughs.

Budget pressure

Traditionally, the federal government underwrites basic scientific research and military applications, through agencies such as the National Science Foundation, while industry focuses on product development.

The Government Accountability Office estimates that public and private-sector research and development investments of about $284 billion annually have fueled advances in science and technology in the U.S.

The 2006 federal research and development portfolio totals $134.5 billion, the American Association for the Advancement of Science said in an analysis.

Such federal funding has led to far-reaching breakthroughs.

The Defense Advanced Research Projects Agency (DARPA), a Defense Department agency with a $3 billion budget, has supported a wide array of innovative technology that has led to development of the Internet, advanced imaging sensors used in a “camera in a pill” and Global Positioning Systems. DARPA initially funded the technology now used by Konarka.

The National Science Foundation, created by Congress in 1950, backed the physics, ceramics, glass engineering and other initial research that led to fiber-optic cables, mathematical algorithms that led to bar codes and other technologies.

The Energy Department’s Office of Science is another major source of research funding, and its programs have led to lithium batteries and new types of superconductors that offer more efficient ways to transmit electricity.

But the agencies’ basic research budgets are shrinking.

“Many flagship federal science agencies have disappointing budgets in 2006,” according to an analysis by Kei Koizumi, director of R&D Budget and Policy Program at the American Association for the Advancement of Science (AAAS).

The National Institutes of Health (NIH) budget fell for the first time in 36 years, the National Science Foundation has less in real terms for its research portfolio than in any of the past three years, the Energy Department’s Office of Science budget declined, and Defense Department basic research funding declined, according to the AAAS analysis.

“On one hand, less money means fewer ideas will be funded. On the other hand, it may mean only the best or highest-impact ideas will be funded. The problem is, it is impossible to know in advance which ideas will pay off,” Mr. Koizumi said.

Weapons development and space exploration technologies received large boosts, making this fiscal year’s overall research and development budget $2.2 billion greater than in 2005.

Despite the dip in funding for basic science, U.S. research and development spending accounts for more than a third of the global total, outstripping any other nation.

The U.S. share has declined somewhat from 40 percent of all global research and development during most of the 1990s, while other nations’ shares have risen dramatically, AAAS analysis shows. China, for example, is rapidly increasing its own investments and now is the third-largest investor in research and development, behind Japan and the U.S.

“The challenge is that others — China, India and Europe — are aware of our innovation model. So we can’t stand still,” said Deborah Wince-Smith, president of the Council on Competitiveness.

Duke University’s Master of Engineering Management Program published a report in December saying some of the most extreme statistics — that China graduates almost 10 times the number of engineers as the U.S., for example — do not accurately reflect the quality and level of education for the newly minted professionals.

“The [U.S.] needs to maintain its focus on improving the quality of education and maintain its momentum, but there is no imminent crisis,” Duke’s report said.

Wired to compete

Companies such as Konarka are aware of the high stakes when it comes to maintaining a competitive edge. Creating and adapting new technology is crucial to the 40 jobs the company has created and $60 million in venture capital it has attracted.

“I think innovation is critical. When you think about the development of technology, and think about how technology is developed, the real innovation occurs here,” Mr. McGahn said of the U.S. “As a society, we will start to struggle if we lose that.”

But while others can try to copy the U.S. model of university-industry collaboration and government funding, they will not be able to copy some features unique to the U.S., Mr. McGahn said. For example, the U.S. is a uniquely heterogeneous society, which makes it possible to have some of the brightest minds from different countries and cultures around the world working side by side in science and commerce.

The inventor of Konarka’s technology, Mr. Tripathy, was a native of India and conceived of his technology as a way to bring electricity to his country’s rural poor.

This type of innovation has kept U.S. industry humming — with new companies and new products — even as old-line manufacturers that have failed to adapt have fallen by the wayside.

Mr. McGahn, a native of New Jersey with a degree from the Massachusetts Institute of Technology, said the U.S. has another unique advantage that helps companies turn good science into globally competitive products — baseball.

“At a young age, you’re told to stand up there in the batter’s box and perform by yourself,” he said. “That’s how we’re wired. Americans are better wired to compete.”

Part I: Companies close up shop

Part II: Flexible companies change to stay put

Part III: Jetting parts around the world

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