From: Extropian Agro Forestry Ventures Inc. (megao@sk.sympatico.ca)
Date: Tue Sep 10 2002 - 19:48:55 MDT
http://www.Forbes.com/2002/09/10/0910topnews.html
Patents No Longer Pending
Mark Lewis, 09.10.02, 9:02 AM ET
NEW YORK - The technology boom of the late 1990s may finally be over,
and
no, we're not talking about stock prices. The growth rate for new
patent
applications reportedly has fallen off considerably this year, which
could
undercut productivity growth and thus further undermine investor
confidence
in the economy.
The number of patent applications in the U.S. had been increasing by
about
10% per year since 1996, but this year the increase probably will only
be
about 1.3%, according to The Financial Times. The FT also reports that
Intel
(nasdaq: INTC - news - people ) is worried that venture-capital firms
are
investing so little in tech startups these days that innovation in
Silicon Valley
is being stifled.
No surprise here: The slump in stock valuations has a negative impact
on
tech investment, which means less funding for the inventors, which
means
fewer patent applications. It's a vicious circle because the decline in
innovation may slow the economy's evolution into an increasingly
efficient
machine based on information technology.
Intel has continued to invest heavily on research and development
during the
slump, but the firm is having trouble finding venture-capital partners
to share
the burden of investing in startups. "The situation is growing
progressively
worse," Intel Capital head Les Vadasz told the FT. "Our industry relies
heavily
on the flow of technology innovations from start-up companies."
Of course, paranoia is the house philosophy at Intel, so the situation
may not
be quite that dire. Intel itself is trumpeting some interesting new
initiatives,
such as security features for its microprocessors and the use of
"hyper-threading" technology to speed up the processors used in desktop
computers.
Moreover, Hewlett-Packard (nyse: HWP - news - people ) on Monday
announced the creation of molecular-based memory circuits with more
than
ten times the density of current silicon chips. The new technology is
not yet
commercially viable, but it holds out the promise that the theoretical
limits
imposed by silicon may not impede the future path of innovation.
The apparent slowdown in patent applications is disturbing, but not
necessarily a disastrous portent. We've spent the last few years
developing a
raft of fancy new technologies, but their positive impact on
productivity has not
always been clear. Perhaps the next few years will be devoted to
consolidating these theoretical gains and putting them to work, which
would
boost productivity while clearing the decks for the next round of
hyper-innovation. That's not the way a paranoid would look at it, but
sometimes a little optimism comes in handy, too.
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