April 2000

National Institute of Standards and Technology • Technology Administration • U.S. Department of Commerce

Development, Commercialization,

and Diffusion of Enabling

Technologies: Progress Report

ADVANCED TECHNOLOGY PROGRAM

NISTIR-6491
NISTIR 6491

Development, Commercialization, and

Diffusion of Enabling Technologies: 

Progress Report

Jeanne W. Powell

Karen L. Lellock

U.S. DEPARTMENT OF COMMERCE

Technology Administration

National Institute of Standards and

Technology

Advanced Technology Program

April 2000
NISTIR 6491

Development, Commercialization, and

Diffusion of Enabling Technologies:

Progress Report

Jeanne W. Powell

Karen L. Lellock

U.S. DEPARTMENT OF COMMERCE

Technology Administration

National Institute of Standards and

Technology

Advanced Technology Program

April 2000

U.S. DEPARTMENT OF COMMERCE

William M. Daley, Secretary

TECHNOLOGY ADMINISTRATION

Dr. Cheryl L. Shavers, Under Secretary of

Commerce for Technology

NATIONAL INSTITUTE OF STANDARDS AND

TECHNOLOGY

Raymond G. Kammer, Director
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report 

Abstract

This report presents a statistical picture of progress in early1998 as reported by 539 organizations

which received ATP awards during the period from 1993 through 1997. Using data collected

through the ATP’s Business Reporting System (BRS) in reports filed during the year ended March

31, 1998, the report examines plans for commercialization for evidence of opportunities for

economic spillovers and national economic benefit; it provides indicators of ATP’s effect in

accelerating R&D, stimulating collaborations, and increasing private-sector investment in high-risk

technology development; and it examines progress of ATP-funded technologies during the award

period. The report updates the December 1997 ATP report Development, Commercialization, and

Diffusion of Enabling Technologies: Progress Report for Projects Funded 1993-1995.

The study provides evidence that the ATP has funded projects with considerable opportunity for

broad economic benefit. More specifically, participants in 261 projects have identified more than

1,200 potential uses of their technologies under development, and outlined business plans for nearly

1,000 of these. Acceleration of R&D, and collaboration with other organizations for R&D and for

commercializing their technologies, are reported by 86 percent of participants having received at

least one year of ATP funding. Industry has increased its own investment in the ATP-funded

technology development areas by over $300M, representing a 58 percent increase over what would

have been invested from industry sources without the ATP awards. Seventy-three percent of

organizations report that they are able to undertake a project of higher technical risk as a result of

ATP funding. 

Although substantial commercialization results from ATP-funded projects will usually take a number

of years after ATP funding ends, considerable business planning activity is underway and many

companies report achievement of early commercialization milestones. Sixty-four percent of projects

have completed a production prototype for at least one application; 17 percent of companies report

earning revenues from their ATP-funded technology.

Keywords

Acceleration; Advanced Technology Program; collaboration; commercialization; program evaluation;

small firms; technology development

Acknowledgments

This report was made possible through the cooperation of hundreds of ATP-funded organizations who

are providing information through ATP’s Business Reporting System in support of program evaluation

and project monitoring efforts. Stephen F. Weber, Building and Fire Research Laboratory, developed

the BRS software, which has proved critical to timely and efficient data analysis, and has provided

assistance in use of the data over the course of numerous reports. Many individuals in the ATP

contributed to the report: Jo Ann Brooks, graphics artist, prepared the diverse illustrations; Rosalie

Ruegg provided insightful and detailed reviews; Robert Sienkiewicz and Cita Furlani provided

additional comments and suggestions. Paul Doremus, NIST Program Office, provided assistance and

advice for linking this and subsequent BRS-based reports to NIST’s performance plan.
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report 

Preface

The Advanced Technology Program (ATP), administered by the U.S. Commerce Department's National

Institute of Standards and Technology (NIST), partners with U.S. industry to fund the development of

high risk and enabling technologies, with significant potential for stimulating U.S. economic growth.

Industry submits proposals containing a research plan for the work to be performed, an explanation of

how the nation will benefit broadly from the new technical capability, a business plan for future

commercialization of at least some of the goods and services that may derive from the technology, plans

for diffusing the technology beyond the innovators, and a project budget indicating the proposed costshare arrangement. Through a highly competitive peer review process, involving a mix of technical

experts from government laboratories, and business and economic experts from the private sector and

government, projects with both high technical and business/economic merit are selected for funding.

The ATP costs shares with industry the R&D costs of the award-winning projects; the companies are

fully responsible for business planning and product development costs.

The ATP provides funding for both single-company and joint-venture projects. Eligible joint ventures

consist of a minimum of two for-profit companies participating in the R&D and contributing cost share,

and may contain additional companies, universities, or research organizations. Only U.S.-owned

companies or U.S. subsidiaries of foreign-owned companies are eligible to receive awards and the latter

only if they meet certain tests. Single company proposers may receive funding of up to $2 million in

direct costs over three years and must cover their own indirect costs. (Beginning in 1998, large singlecompany proposers -- Fortune 500 or equivalent -- must cover at least 60 percent of total project costs.)

Joint ventures may propose a project of any size for up to five years of funding but must cover more than

50 percent of total project costs.

Since its first congressional appropriation in 1990, the Advanced Technology Program has funded 468

projects, with over 1,000 participating organizations across a mix of 311 single company projects and

157 joint venture projects; and over 1,000 organizations in subcontract relationships. Project awards

amount to $1.496B, with industry committing an additional $1.499B in cost share. 

This report uses the ATP’s Business Reporting System (BRS) to update the ATP report Development,

Commercialization, and Diffusion of Enabling Technologies: Progress Report for Projects Funded

1993-1995, published in December 1997. The average stage of evolution for the portfolio of projects

funded since FY1993 aged by approximately a year and a half between the first and second reports. A

new chapter entitled “Changes in Competitiveness” has been added. A direct comparison of results from

the two reports for a number of major indicators of progress is provided in Appendix B.

This report is offered as one component of ATP’s on-going evaluation program, which provides

feedback to ATP management and meets the many outside requests for program performance

information. Other studies by the Economic Assessment Office (EAO) staff and outside contractors

include detailed case studies of ATP-funded projects, statistical and econometric studies, status reports

on the accomplishments of completed projects, methodological studies, and other topics of interest to

the evaluation community. For copies of EAO reports, see “publications” at the EAO Web site

(http://www.eao.atp.nist.gov), or contact the EAO directly at (301) 975-4332.

NIST Disclaimer: Certain commercial firms and trade names are identified in this report in order to

specify aspects of the NIST Advanced Technology Program. Such identification is not intended to

imply the recommendation or endorsement by the National Institute of Standards and Technology, nor

is it intended to imply that related products or services are necessarily the best available.
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

EXECUTIVE SUMMARY

This report provides a statistical overview of progress reported by hundreds of companies and other

organizations which received awards from the ATP between 1993 and 1997. The report annotates the

statistics with comments from project participants. The information is based entirely on Business

Reporting System (BRS) reports to the ATP filed by 539 individual organizations through March 31,

1998. While not all the companies and projects are progressing at the same rate, the statistical analysis

presented here provides an overview of the level of progress towards research and commercialization

goals of a large group of ATP award recipients. 

Progress reports from individual firms, and aggregate summary statistics of progress for the group of

projects provide evidence that the ATP is (a) providing opportunities for economic spillovers and broad

national economic benefit; (b) accelerating R&D and reducing time-to-market in highly competitive

markets; (c) stimulating collaboration and the effects thereof; (d) increasing private sector investment

in high risk technology development; and (e) encouraging progress towards ultimate commercialization

of the resulting technologies.

Opportunities for economic spillovers and national economic benefit:

 Early on in their projects, participants are identifying plans to commercialize their ATP-funded

technologies in diverse applications. 

- Participants in 261 projects have identified more than 1,200 different applications (or uses)

of the technologies under development, providing evidence that the technologies funded by

ATP are highly enabling. 

- Companies indicated that they are pursuing commercialization of nearly 1,000 applications

spanning the spectrum of industries.

- Most of the technologies under development offer new types of solutions to market needs or

substantial performance and productivity improvements over existing capabilities.

 

- Most of the technologies under development feed into the early stages of the production chain,

creating a greater opportunity for intermediate producers and downstream customers in multiple

application areas to benefit from market spillovers.

 Patent and copyright activity and dissemination of knowledge created with ATP funding have been

vigorous for many projects.

- About 240 new patents have been filed, representing an average of 1.2 patents per project for

the period covered. Thus far 23 patents have been issued. Patent and copyright activities

facilitate dissemination of knowledge through patent disclosure and provide additional

commercialization opportunities by others through licensing arrangements. Licensing to others

is a primary or secondary strategy for commercializing 47 percent of the planned applications.

- An average of 3.6 conference papers were presented and 1.3 professional journal articles

published per project during the period covered. Conference activity and publication of papers

were particularly vigorous in some projects. Publications facilitate the broad dissemination of

knowledge developed in ATP projects.
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Acceleration of R&D and reduction of time-to-market in highly competitive markets:

 ATP funding increases the chances that new technologies will be ready in time to meet critical

windows of opportunity in the marketplace. 

- Speed-to-market is considered "critical" or "important" for 98 percent of the commercial

applications. The window of opportunity for successful entry into the marketplace is perceived

by the companies as two years or less after the ATP funding ends for 73 percent of currently

identified applications.

- Eighty-six percent of organizations indicated they are ahead in their R&D cycle as a result of

ATP funding; of these, 24 percent believe they would not have started the project at all without

ATP funding; most of the remainder say they would have proceeded at a significantly slower

rate without ATP funding.

- Acceleration by two years or more is anticipated for 65 percent of planned commercial

applications.

Stimulation of Collaborations and Collaboration Effects:

 The ATP is stimulating collaborative relationships among companies, universities, and other

research organizations.

- For the projects that have completed at least one year, 86 percent of the organizations

reporting indicated that their ATP project involved collaboration with other organizations.

Among these, 88 percent indicated that the ATP was responsible to a moderate or great extent

for their collaborations. 

 Benefits of collaborating were reported by a far larger percentage of those reporting collaborative

relationships than costs, suggesting that collaboration is having a largely positive influence on

technology development. Of those reporting collaboration:

- The most frequent effect of collaboration, reported by 97 percent of the organizations, was

that it helped stimulate creative thinking.

- Other important effects reported included helping them save time, helping them obtain R&D

expertise, accelerating entry into the marketplace, and encouraging them to undertake future

collaborations.

- As might be expected, collaboration can cause higher project management costs. Fifty-six

percent reported a significant or moderate increase in project coordination costs. 

- Other costs of collaborating were reported by a minority of companies: significant or

moderate delays in beginning the R&D due to collaboration were reported by 18 percent, and

time delays in market entry as a result of collaboration difficulties were reported by eight

percent.

- Of the 86 percent of organizations reporting collaboration with other organizations, nearly all

indicated significant or moderate benefits from one or more collaboration effects, compared
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

with 56 percent who indicated moderate or significant increase in project coordination and

management costs.

 In addition to R&D collaboration, ATP-funded companies are planning and pursuing alliances to

commercialize their technologies, with small companies particularly focused on this strategy. One

hundred fifty-six strategic alliances have been formed, and 42 license agreements have been signed

for the purpose of commercializing technologies developed in ATP projects.

Increased investment in high risk, long-term, broader-scope technology development:

 With the assistance of ATP funding, organizations are pursuing different R&D than they would

have undertaken without ATP funding. 

- Seventy-three percent of organizations report that they are pursuing a higher level of technical

risk as a result of the ATP. Sixty-seven percent report that ATP funding has increased their

interest in performing long-term research, and 61 percent report their project encompasses a

broader scope as a result of the ATP. (These effects are in addition to the accelerated pace

mentioned earlier.)

- For 30 percent of applications anticipating a performance or cost improvement, performance

improvements of 100 percent or more are anticipated. Cost reductions of 25 percent or more

are anticipated for 40 percent of these applications. Expectations that large improvements in

performance or large reductions in production costs will result from the ATP-funded projects

are evidence that industry is pursuing "discontinuous" or "breakthrough" innovations, and

suggestive of relatively risky R&D.

- Thirty-eight percent of applications are considered by the project participants to be "new-tothe-world" solutions to a market need or problem with the potential to create totally new

markets, another indication of the “breakthrough” nature of the ATP-funded innovation. Many

companies plan to utilize their ATP-funded technology in a mix of "new-to-the-world" products

and cost reduction and performance improvements in existing products, processes, or services.

 ATP funding has encouraged organizations to invest more of their own industry funds in the ATPfunded technology areas than they would have otherwise.

- Industry has increased its investment in the ATP-funded technology development areas,

beyond what would have occurred in the absence of the ATP awards, by an estimated $320

million; i.e., across the group of projects, companies have expanded the scale of their R&D

efforts in the ATP-funded areas by the amount of ATP funding received plus an additional $320

million, in addition to what they would have put into the effort without ATP. This represents

an estimated 58 percent increase in industry funding in addition to the ATP funding.

- The ATP-funded companies have attracted $200 million of new funding from outside sources

to support their ATP-related development or commercialization work.

Progress towards commercialization of ATP-funded technologies:

 Progress is being made towards developing new capabilities and achieving cost savings through

new and improved processes.
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

- Fifty-four percent of the companies, representing 66 percent of the projects, report they are

now able to make a new or improved product, even though the product may not yet be ready

for the marketplace.

- Thirty-nine percent of companies, representing 51 percent of the projects, report they have

already adopted process improvements resulting from their ATP technology.

 Companies are engaging in commercialization planning activities, at their own expense, in order

to enter the marketplace in a timely manner, once the technology is ready. (ATP funds R&D only.)

- Companies in 84 percent of the projects have completed product/process definition for at least

one application; companies in 70 percent of the projects have completed concept testing for at

least one application of their technology; and concept testing has been conducted for 44 percent

of all applications being planned by the ATP-funded companies.

- Companies in 63 percent of the projects have conducted other market analysis activities, for

example, sales forecasting or related product development or testing.

- Sixty-four percent of projects have completed a production prototype for at least one

application, and 55 percent of projects have completed pilot production or a commercial

demonstration. 

- Actual production of products is already underway for 22 percent of the projects and for 10

percent of the planned commercial applications (although not necessarily for the most

significant applications).

- About 17 percent of companies, representing 27 percent of projects, indicate they have earned

early product or service revenues, amounting to more than $67 million, typically from sales of

samples and prototypes and early “spin-off ”activities. Six percent of projects have earned $5

million in licensing royalties.

- The large revenue flows lie in the future. Revenue is expected for about 19 percent of

applications and 18 percent of companies before the end of the ATP project, and not until four

or more years after the ATP project ends for nearly 8 percent of applications and 12 percent of

projects. For most, revenue is expected for most within four years after the ATP project ends.

 Most ATP-funded technologies are keeping pace with developments in fast-paced international

markets. Fifty-five percent of companies report their overall competitive standing is unchanged,

and forty-two percent report their overall competitive standing has improved for at least one

application. A number of companies believe their competitors are advancing on them and in a few

cases have caught up with them.

Taken as a whole, the results of this report strengthen the results of earlier studies by increasing the

robustness of statistical evidence that the ATP is making solid progress towards achieving its mission

of economic growth through technological advancement. The BRS is a tool that allows the ATP to

capture developments in the short-mid-term and report on the evolution of ATP-funded technologies

towards commercialization and the generation of national economic benefits.
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

TABLE OF CONTENTS

Abstract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

Keywords . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv

1. THE ATP'S BUSINESS REPORTING SYSTEM: A TOOL FOR ECONOMIC 

EVALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Overview of ATP’s Evaluation Program ........................................... 1

Overview of the Business Reporting System ........................................ 1

About This Report ............................................................ 3

2. PATHS TO NATIONAL ECONOMIC BENEFITS ................................... 7

Development of Technologies with Diverse Applications ............................. 7

Business Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Identification of Commercialization Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

3. R&D STATUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Level of Progress in Completing R&D Phase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Effect of ATP Funding on R&D Progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

When Can Revenue Be Expected? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

4. STIMULATION OF COLLABORATION AND RELATED EFFECTS . . . . . . . . . . . . . . . . . . 19

Stimulation of R&D Collaboration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Collaboration Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Anecdotal Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Obtaining expertise not otherwise available . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Obtaining assistance from universities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Learning more about potential markets and customer needs and accelerating entry 

into the marketplace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Formation of stronger supplier-customer relationships . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Strengthening credibility within the organization and with other organizations . . . . . . . . . 26

Elaboration of the "benefits and costs" of collaboration . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Formation of Strategic Alliances Outside the ATP Project for Commercialization of ATPfunded Technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

5. IMPACT ON INDUSTRY R&D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Stimulation of Private Sector Investment and Leveraging of Other Investment . . . . . . . . . . . . 30

Increased Credibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

6. EARLY COMMERCIALIZATION ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Commercialization Planning Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Early Commercial Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Anecdotal Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

Ability to make new and/or better products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Prototyping and customer testing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

Implementation of new or improved production processes . . . . . . . . . . . . . . . . . . . . . . . . . 39

7. CHANGES IN COMPETITIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Trends in Competitiveness and Competitive Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Status of Competitors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

8. INTELLECTUAL PROPERTY PROTECTION AND DIFFUSION OF TECHNOLOGY . . . . 43

Protection and Disclosure of Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Dissemination of Non-Proprietary Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

9. RELATIONSHIP TO PRIOR WORK AND CONCLUSIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Relationship to Prior Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Summary of Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Plans for Future Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

REFERENCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

APPENDICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Appendix A. Planned Diverse Applications of ATP-funded Technologies . . . . . . . . . . . . . . . 51

Appendix B. Comparison of ATP Progress at Two Points in Time . . . . . . . . . . . . . . . . . . . . . 58

LIST OF TABLES

Table 1. Source of Data: Most Recent BRS Reports filed As of March 31, 1998 .............. 3

Table 2. Examples of Effect of ATP Funding on Company Goals for the Technology . . . . . . . . . 11

Table 3. Strategic Alliances and Licensing Agreements for Commercialization . . . . . . . . . . . . . . 29

Table 4. Dissemination of Non-proprietary Information from ATP-funded Projects . . . . . . . . . . . 44

LIST OF FIGURES

Figure 1. Distribution of Types of Participation and Types of Organizations .................. 4

Figure 2. Distribution for Organizations That Had Completed One or More Years 

of ATP Funding ....................................................... 5

Figure 3. Technologies Under Development ........................................... 6

Figure 4. Planned Diverse Applications of ATP-funded Technologies ....................... 8

Figure 5. How ATP-funded Technologies Are Expected Eventually To Be Deployed ........... 9

Figure 6. Stages of Production in Which the ATP-funded Technologies Are Expected 

to Be Used . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Figure 7. Quantitative Business Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Figure 8. Importance of Market Timing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Figure 9. Strategies for Commercializing ATP-funded Technologies . . . . . . . . . . . . . . . . . . . . . . . 13

Figure 10. Strategic Alliances Planned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Figure 11. R&D Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Figure 12. Acceleration of R&D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Figure 13. When Can We Expect To See Revenues from ATP-funded Technologies? . . . . . . . . . 17
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Figure 14. Stimulation of Collaborations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Figure 15. Effects Most Enabled by Collaboration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Figure 16. Other Effects Enabled by Collaboration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Figure 17. Costs Attributed to Collaboration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Figure 18. Stimulation of Industry R&D Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Figure 19. Change in the Nature of Industry R&D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Figure 20. Increased Credibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Figure 21. Increased Credibility – Small Businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Figure 22. Attraction of Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Figure 23. Market Analysis Progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Figure 24. Progress Towards Commercial Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

Figure 25. Progress Towards Early Products and Processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Figure 26. Changes in Competitiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Figure 27. Status of Competitors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

Figure 28. Intellectual Property Strategies Planned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Appendix A.1 Planned Diverse Applications of ATP-funded Technologies –

Information Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Appendix A.2 Planned Diverse Applications of ATP-funded Technologies –

Manufacturing (Discrete) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Appendix A.3 Planned Diverse Applications of ATP-funded Technologies –

Biotechnology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

Appendix A.4 Planned Diverse Applications of ATP-funded Technologies –

Electronics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Appendix A.5 Planned Diverse Applications of ATP-funded Technologies –

Chemicals & Chemical Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

Appendix A.6 Planned Diverse Applications of ATP-funded Technologies –

Energy and Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

Appendix A.7: SIC Codes Included in “Other” Category . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Appendix B.1 Distribution of Types of Participation and Types of Organizations . . . . . . . . . . . . . 58

Appendix B.2 R&D Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

Appendix B.3 Early Commercialization Activities–Strategic Alliances and 

Licensing Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

Appendix B.4 Early Commercialization Activities-Commercial Production and Sales . . . . . . . . . . 61

Appendix B.5 Protection of Intellectual Property and Dissemination of 

Non-proprietary Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
 1

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

1. THE ATP'S BUSINESS REPORTING SYSTEM:

 A TOOL FOR ECONOMIC EVALUATION

Overview of ATP’s Evaluation Program

Program evaluation has been a central component of ATP operations from the beginning, first, as a

management tool to provide feedback to project selection and program operations; and, second, to meet

requests from external sources for ATP program results. ATP’s founding legislation dictated that

evaluation be a feature of the program. In addition, the ATP, like other federal programs, is subject to

the evaluation requirements of the 1993 Government Performance and Results Act (GPRA). The ATP’s

leadership in development of evaluation methodologies has been recognized through the many inquiries

about its evaluation tools and methodologies from other agencies, as well as from science and

technology funding programs in other countries. 

The ATP has developed a multi-component evaluation strategy to provide measures of progress and

performance matched to the stage of project evolution; i.e., for the short-term, from the time of project

selection and over the course of the ATP-funding period; for the mid-term, as commercial applications

are pursued, early spin-off products reach the market, and dissemination of knowledge created in the

R&D projects occurs; and for the longer-term, as more fully-developed ATP-funded technologies diffuse

across multiple products and industries, with related net impacts on formation of new industries, job

creation, and U.S. economic growth. 

Short-mid term evaluation components have included 1) descriptive (statistical) profiling of applicants,

projects, participants, technologies, and applications and 2) measures of project progress and

performance. This report presents progress measures for projects funded from 1993 through 1997.

Overview of the Business Reporting System

In the early years of the program, the ATP relied on third-party surveys of projects to determine their

progress and performance against short-mid-term program objectives. In early 1994, the ATP

implemented the Business Reporting System (BRS), a comprehensive data collection tool for tracking

progress of the portfolio of projects against business plans and projected economic goals. Organizations

participating in ATP projects report directly to the ATP on their progress as they build upon and

implement the plans presented initially in the project proposals. The survey system, electronically

administered, has been implemented on a routine and regular basis for projects selected in the 1993

competition and since, from their inception. For maximum detail concerning the multiple

commercialization activities of joint venture members and to ensure confidentiality of each joint venture

member’s plans, data is collected at the individual participant level (from individual companies,

universities, and not-for-profit organizations) within a project. 

The survey information collected through the BRS comprises part of the integrated ATP database

framework. It is intended for use for ATP project management, as well as by researchers for performing

evaluation research. Over time, the data is expected to support comprehensive analyses of the behavior

of firms conducting advanced R&D and developing new technologies; of business progress; and of

diffusion of economic benefits.
2

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

The Business Reporting System consists of five major parts: 

 A Baseline Report. At the beginning of the project, in the Baseline Report, companies identify

potential areas of application of the technology being developed with ATP funding. They identify

quantitative business goals, including cost or performance targets; key attributes of the technology

needed to achieve these goals; planned strategies for commercialization; e.g., in-house production,

licensing, and strategic alliances. They outline their strategies for protecting intellectual property;

and identify their plans for disseminating non-proprietary information. 

 Anniversary Reports. Annually, in the Anniversary Report, companies expand upon the baseline

information to cover progress towards implementing commercialization strategies. They report on

early economic impacts of the project, as well as collaboration experiences, attraction of new

funding, new intellectual property created, and dissemination of information through conferences,

publications, and other mechanisms. They also provide a summary of company financial data. 

 Quarterly Reports. At the end of each quarter, other than the baseline and anniversary quarters,

companies report one or more significant business developments related to their ATP project. 

 Close-out Report. At the project conclusion, in the Close-out Report, companies update

Anniversary Report information and identify remaining technical and business barriers to

commercialization of the technology, define specific business goals for the following five-year

period, and indicate expected future effects of the ATP project outside that organization. 

 Post-project Reports. Following the end of ATP funding, companies report three times--once every

two years -- concerning actual progress in commercializing the technology and related impacts

inside and outside the organization. 

Companies funded in FY 1993 and later are required to submit these reports under the terms and

conditions of their ATP awards. Under ATP's agreements with project participants, all information

reported through the BRS is considered proprietary and confidential. Information is released and

published only in aggregate, summary statistical form, or in quotes without attribution, unless companies

agree to disclosure or the same information is available from company press releases.

 

It is recognized that surveys conducted by the ATP of its awardees may result in some self-reporting

bias. Nevertheless, such instruments are essential to capturing, on a portfolio-wide, standardized basis,

the rich and varied experiences of companies engaged in ATP-funded technology development, and

subsequent commercialization and technology diffusion. The BRS survey instruments are subjected to

extensive review for questioning bias; data are routinely reviewed for validity, quality, and

completeness; and analytical results are subject to extensive NIST-wide review and critique before

publication. Response rates have been high–nearly 100 percent for recipients of single-company awards

and 80 percent for participants in joint-venture projects. Recently, the ATP has initiated research efforts

to corroborate its data collected from project participants with data from independent sources and to use

control groups where feasible.
 3

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

1990-

1992

1993 1994 1995 1996 1997 1998 Total

Number of ATP Awards Announced 60 29 88 103 8 64 79 431

Total Awards Announced 1993-1997 292

In BRS--Number of PROJECTS with

reports available as of March 31,

1998:

Baseline Report Only 1 7 54

First Anniversary Report 1 3 12

Second Anniversary Report 2 28 68 199

Third Anniversary Report 2 3

Close-out Report 22 43 15

Total BRS PROJECTS 261

Number of PARTICIPANTS in ATP

Awards announced (as of award date)

150 50 211 318 12 101 168 1010

Total Number of PARTICIPANTS in

1993-1997 Awards

692

In BRS--Number of PARTICIPANTS

with reports available as of March 31,

1998:

Baseline Report Only 1 7 19 9 79

First Anniversary Report 1 18 72

Second Anniversary Report 4 87 128 424

Third Anniversary Report 11 8

Close-out Report 28 50 17

Total BRS PARTICIPANTS 539

Table 1. Source of Data: Most Recent BRS Reports filed As of March 31, 1998 

About This Report

This report provides a snapshot as of 1998 of plans and progress of projects funded in competitions held

from 1993 through 1997, and of the pathways to achieving impact. It provides measures of program

performance against major short-mid-term ATP goals: the funding of high-risk, enabling R&D and

stimulation of private-sector investment in the same; the stimulation of effective R&D collaborations;

the acceleration of technology development; and evidence of spillover knowledge and

commercialization activity. This report updates the December 1997 ATP report Development,

Commercialization, and Diffusion of Enabling Technologies: Progress Report for Projects Funded

1993-1995. The current report extends the coverage from projects and participants funded from FY1993

through FY1995 to those funded through 1997, and it extends the analysis of progress from December

1996 through March 1998. Appendix B provides a summary picture of progress of the ATP at two

points in time for some key measures and thus captures some of the evolution of the program over the

period.

The report draws on the most recent BRS reports filed by participants in the reporting system as of

March 31, 1998. Table 1 illustrates the number of projects and participants covered in these BRS
4

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Types of Project Participation

(539 Organizations)

Single

Applicants

32%

Joint

Venture

Participants

68%

Notes: * Fewer than 500 employees.

 ** Fortune 500 or equivalent as of Fortune 500 listing published April 1997.

Source: Business Progress Reports from 539 organizations in 261 ATP projects funded 1993-1997.

Types of Organizations

(539 Organizations)

Universities

5%

Non-profits &

Gov't Labs

5%

Small*

Businesses

41%

Medium

Businesses

21%

Large

Businesses**

28%

Figure 1. Distribution of Types of Participation and Types of Organizations

reports, broken down by the number of reports of each type -- Baseline, Anniversary, and Close-out.

For reference, the number of ATP awards and project participants announced each year are also shown.

The 261 projects covered include all ATP awards made during the 1993-1997 period, with the exception

of 21 projects since cancelled and 10 FY 1997 projects that had not yet started as of March 31, 1998.

The projects funded in FY 1998 are not included because the awards had not been made as of March 31,

1998. The 60 projects funded between 1990 and 1992 were funded prior to implementation of the BRS.

The difference between the 539 participants covered in the BRS data and the total of 692 participants

in the FY 1993-1997 awards, reflects several factors: 1) cancellation of 21 projects; 2) changes in joint

venture membership over the course of the awards; 3) limitation of BRS reporting to major participants

for a few very large joint ventures and exclusion of non-profit organizations with a purely administrative

function, 4) late start of 10 FY 1997 projects; and 5) some late reports. 

Figure 1 illustrates the distribution of types of organizations and types of ATP projects (single-company

or joint venture) included in the BRS data as of March 31, 1998. All the organizations had provided at

least an initial Baseline Report by March 31, 1998, even if some had not yet reported actual progress.

Reports from these organizations provide the basis for analyses of business plans and goals presented

in Chapter 2.
 5

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Types of Project Participation

(424 Organizations)

Single

Applicants

30%

Joint

Venture

Participants

70%

Notes: * Fewer than 500 employees.

 ** Fortune 500 or equivalent as of Fortune 500 listing published April 1997.

Source: Business Progress Reports from 424 organizations in 199 ATP projects funded 1993-1997

 after one or more years of ATP funding.

Types of Organizations

(424 Organizations)

Universities

5%

Non-profits &

Gov't Labs

6%

Small*

Businesses

36%

Medium

Businesses

22%

Large

Businesses**

31%

Figure 2. Distribution for Organizations That Had Completed One or More Years of

ATP Funding

The subgroup of organizations reporting actual commercialization progress or other effects of ATP

funding after one or more years of funding represent those shown in Table 1 as having filed at least one

Anniversary Report or a Close-out Report. They are described further in Figure 2 and include 424

participants in 199 projects that had provided Anniversary or Close-out Reports after one or more years

of ATP funding. Reports from these organizations provide the basis for analyses of actual progress

towards project goals and other effects of ATP funding presented in Chapters 3 through 8.

Most for-profit companies report some degree of commercialization progress. This attention to

commercialization even during the ATP funding period is consistent with the ATP's model that requires

companies to set commercial goals up front, and to integrate plans for their R&D goals and for their

business/economic goals from the outset. Most universities and non-profits do not plan to

commercialize their ATP-funded technologies but have reported on other effects of ATP funding.
6

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Information/

Computer Systems

32%

Manufacturing

(Discrete)

21%

Materials

13%

Biotechnology

13%

Electronics

10%

Source: Business Progress Reports from 510 organizations in 257 ATP-funded projects 1993-1997.

Chemicals and

Chemical Processing

 (and other continuous

Manufacturing)

7%

Energy and

Environment

4%

Figure 3. Technologies Under Development

LEGEND for Breakdown of Technology Areas

Manufacturing (Discrete) Materials

Biotechnology Electronics Energy and Environment

Chemicals and Chemical Processing

(and other Continuous Manufacturing)

Information/Computer Systems

Computer Software, 57%

Computer Hardware, 15%

Other/Not Specified, 20%

Automobile Manufacturing, 44%

Machine Tools, 28%

Intelligent Manufacturing, 10%

Other/Not Specified, 18%

Composites, 37%

Coatings, 16%

Metals and Alloys, 15%

Other/Not Specified, 31%

Human Diagnostic Biotechnology, 41%

Human Therapeutics, 18%

Bioprocessing / Bioengineering, 15%

Other/Not Specified, 26%

Displays, 37%

Electronic Instrumentation/Sensors

 and Control Systems, 18%

Optics and Photonics, 10%

Semiconductors and Microelectronic

 Fabrication Technology, 6%

Other/Not Specified, 29%

Energy Distribution/

 Conservation, 45%

Energy Resources/

 Generation, 32%

Other/Not specified, 17%

Catalysis/Biocatalysis, 42%

Separation Technology, 21%

Process Control, 12%

Other/Not Specified, 24%

Imaging & Image Processing, 8%

Environment, 6%
 7

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

2. PATHS TO NATIONAL ECONOMIC BENEFITS

This chapter describes the pathways through which projects funded 1993-1997 are expected to achieve

national economic benefits. Along the direct pathway, companies will bring new products and services

into the marketplace, will use ATP-funded process technologies in in-house production, or will license

their technology to other companies. Benefits will spill over to customers, licensees, and end users. At

least one for-profit company in nearly all projects has reported such plans for one or more applications

of the ATP-funded technologies. Most universities, non-profits, and government laboratories in joint

venture projects, as well as many of the companies, have reported plans for dissemination of nonproprietary information concerning technology developed with ATP funds, an important indirect path

to economic impact. 

Development of Technologies with Diverse Applications

The projects covered by this report include 95 projects funded through annual General Competitions

open to all technology areas and 166 projects funded through focused program competitions. Many

projects and entire Focused Programs, consisting of sets of related projects, involve an interdisciplinary

mix of science and technology fields. ATP-funded interdisciplinary technologies often enable economic

activity across multiple industries. Other projects are tied more narrowly to a single technology area but

the performance gains over existing methods are so dramatic they help spawn entirely new areas of

economic activity and industries. 

Figure 3 summarizes the technologies according to their multi-level code assignments. Projects are

grouped into broad technology areas and then further broken down into categories more descriptive of

the project focus. Thirty-two percent of the projects directly involve Information Technology/Computer

Systems, either hardware or software. Discrete manufacturing, materials and biotechnology comprise

major parts of the remainder. These four areas of concentration reflect the fact that 20 of the 22 ATP

Focused Program areas funded in FY 1995-1997 involve substantial information technology,

biotechnology, materials processing and manufacturing technology. (This distribution differs somewhat

from other technology classification charts published by the ATP because the distribution shown in

Figure 3 (a) reflects only the projects funded in FY 1993-1997; (b) reflects R&D activity at the

organization rather than the project level; and (c) is based purely on the number of organizations

working in a given technology area, not on the relative amount of funding to the technology area. The

distribution of technologies reported here is based on the classification system used by the ATP for

projects funded through FY 1998. The ATP revised its technology classification in 1999.) 

A second-tier analysis helps reveal the interdisciplinary component of many ATP projects. For example,

Figure 3 shows that 10 percent of the work in Manufacturing (Discrete) involves "intelligent"

manufacturing; 15 percent of the work in Information/Computer Systems is hardware. A third-tier

analysis (not presented) would show that computer hardware has a strong electronics component; e.g.,

digital data storage. This next level of analysis also would reveal the overlapping of projects across

disciplines and the difficulty of classifying them. For instance, some computer systems components and

related manufacturing technologies are assigned to the Electronics category; e.g., Displays and

Semiconductors and Microelectronic Fabrication technology. (ATP’s revised technology classification

for FY99 and later projects reclassifies computer-related hardware to the electronics category.) A

number of biotechnology projects intermingle development of materials and electronics technologies.

About 470 project participants have identified more than 1,200 applications of the technologies under

development and provided an outline of a commercialization plan for over 970 of these
8

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded MATERIALS technologies

support applications in numerous industry sectors

Other

(SIC 13, 16, 31, 32,

34, 38, 80, . . . )

32%

MATERIALS

13%

Note: "Other" SIC categories are defined in Appendix A. 

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Industrial Machinery

and Equipment

(SIC 35)

29%

Transportation

Equipment

(SIC 37)

15%

Rubber &

Miscellaneous

Plastic Products

(SIC 30)

15%

Chemicals &

Allied Products

(SIC 28)

9%

Figure 4. Planned Diverse Applications of ATP-funded Technologies

applications spanning the spectrum of SIC industries. Figure 4 illustrates the diverse application areas

of the enabling technologies designated by the companies as in the Materials area. A detailed

examination of individual reports reveals more explicitly the diverse linkages. For example, company

reports for one project involving coatings technology reveals planned applications in industrial

machinery for internal combustion engines (SIC 35), aircraft parts and equipment (SIC 37), and health

services (SIC 80). Another project involving metal and alloy technology reports applications in

construction machinery (SIC 35), truck trailers (SIC 37), and fabricated structural metal products (SIC

34). Illustrations of linkages between other technology areas under development and their diverse

application areas appear in Appendix A. 

Commercialization of the ATP-funded technology will occur through eventual embodiment in a product,

service, manufacturing process, or possibly some combination of these. Figure 5 summarizes the

percentages that are expected to occur in each form. Most commercial deployment of ATP

technologies will occur through manufactured products with significant advantages over existing

products. Individual companies and projects are planning to use their new technical capabilities to

achieve a competitive advantage in the marketplace through a mix of “new-to-the-world” solutions and

cost reductions and performance improvements in products, processes, or services. For 38 percent of

the applications, companies envision their application to be a “new-to-the-world” solution to a market

need or problem.
 9

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Manufacturing

Processes

25% Manufactured

Products

65%

Source: Business Progress Reports for 973 applications being pursued by 462 companies in 255 ATP projects funded 1993-1997.

Services

10%

New

Solution

38%

Performance

Advantage

18% Cost

Advantage

7%

Performance

and

Cost

Advantage

34%

Other

Advantage

3%

Types of Applications Advantages Over Existing Technologies

Figure 5. How ATP-funded Technologies Are Expected Eventually To Be

Deployed

Note: Most companies plan to address more than one stage of production; many plan to address more than two.

Source: Business Progress Reports for 959 applications being pursued by 456 companies in 254 ATP projects funded 1993-1997.

0 20 40 60 80 100

20%

47%

62%

47%

34%

42%

Raw Materials Production

Materials Processing

Components Manufacturing

Assembly

Distribution

End User

Percent of Applications

Figure 6. Stages of Production in Which the ATP-funded Technologies

Are Expected to Be Used

As shown in Figure 6, many companies envision that products and processes embodying the ATPfunded technology will be used in multiple stages of production extending from Raw Materials

Production to End User. Sixty-two percent of the technology applications involve relatively early-stage

Components Manufacturing. 
10

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Performance Improvement

10%

32%

12%

16%

22%

8%

0-9%

Improvement

10-24%

Improvement

25-49%

Improvement

50-99%

Improvement

100-499%

Improvement

500% or more

Improvement

Percent of Applications

0

20

40

60

80

100 Cost Reduction 0-9% Reduction 10-24% Reduction 25-49% Reduction 50-74%

Reduction

75-99%

Reduction

44%

16%

12%

17%

11%

Source: Business Progress Reports for 574 applications anticipating a performance and/or cost advantage over existing technology being 

 pursued by 313 companies in 183 ATP projects funded 1993-1997.

Figure 7. Quantitative Business Goals

The entry of the ATP technology into an early stage of the production cycle, in combination with the

diversity of applications expected to result from individual projects and technologies, increases the

opportunity for downstream customers/users to experience market spillovers (consumer surplus). This

is, of course, especially true where an ATP-funded technology has significant cost or performance

advantages over existing/defender technologies.

Business Goals

In the Baseline Reports, companies who reported they anticipated a performance advantage, a cost

advantage or a combination of the two over existing technologies (see Figure 5) are asked to estimate

their advantage in percentage terms. As shown in Figures 5 and 7, performance improvements are more

frequent, and performance improvements of at least 25 percent appear to be more common than cost

reductions of this magnitude. For 30 percent of applications, a performance improvement in the range

of 100 percent or greater is anticipated. For 40 percent of applications, a cost reduction of 25 percent

or more is expected. The performance and/or cost advantages of “new-to-the-world” solutions over

existing, but entirely different, solutions to the same problem, are usually more difficult to estimate but

often promise to be quite dramatic. Improvements of substantial magnitudes, particularly when

combined with the emphasis on "new" products or lines of business, are consistent with definitions of

"discontinuous" or "breakthrough" innovations used in the joint Rensselaer Radical Innovation Research

- Industrial Research Institute Project funded by the Sloan Foundation (Leifer, 1997). (Of course, for

some projects, even a small cost reduction or performance improvement can represent a significant

economic benefit and important competitive advantage when measured across a large production

volume.)
 11

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Conditions at Project Start Goal Without ATP Funding Goal with ATP Funding

60 microseconds process speed 60 microseconds process speed 10 microseconds process speed

$12/disk $5/disk $.50/disk

3,300 hours lifetime 5,000 hours lifetime 10,000 hours lifetime

2,500 cars/day 2,500 cars/day 2,875 cars/day

34 trains/day 34 trains/day 51 trains/day

1,000 CPU time 100 CPU time 10 CPU time

60 degrees C 60 degrees C 100 degrees C

800 nm 800 nm 200 nm

$60,000 per unit $10,000 per unit $1,000 per unit

45 cm 20 cm 10 cm

40 bases/minute 533 bases/minute 2,000 bases/minute

$500/medical test $500/medical test $50/medical test

1 gene/day sequencing 5 genes/day sequencing 100 genes/day sequencing

3.9 gigabytes data storage 4.7 gigabytes data storage 60 gigabytes data storage

$62/gigabyte $1/gigabyte $1/gigabyte

Source: Business Progress Reports for 911 applications being pursued by 431 companies in 250 ATP projects

funded 1993-1997.

Table 2. Examples of Effect of ATP Funding on Company Goals for the

Technology

Table 2 provides an illustrative list of quantitative examples of how ATP funding is expected to affect

the technological capabilities of companies as measured by expected changes in value for the attribute

identified as most critical to commercialization for a specific application. Quantification of cost and

performance advantages of the ATP-funded technology, such as provided by this business goals analysis,

is useful in tracking project progress as well as assessing business opportunities and estimating the

potential magnitude of economic spillovers. A comparison of goals "with" and "without ATP" is needed

to assess the potential for ATP funding to make a difference relative to what would have occurred

without government funding. An ex ante comparison of baseline values with project goals for key

technology parameters/attributes helps to identify the anticipated degree of technological advancement

and to assess the expected economic impact of the project. An ex post comparison of actual progress

made against cost/performance targets will make it possible to assess the degree to which project goals

for these targets are met and to consider the resulting impact on economic benefits of the project.

Acceleration of R&D is another commonly cited business goal of ATP projects. As shown in Figure

8, nearly all the companies expect some reduction in the time it will take to complete the R&D phase

and bring their products to market/or implement new production processes as a result of ATP funding.

A reduction of at least two years is anticipated for 65 percent of all applications; a reduction of two to

nearly four years is expected for 41 percent of applications; and a reduction of four or more years

(including those that would not be undertaken at all without ATP funding) is expected for 24 percent

of applications.
12

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Importance

of Speed

to Market

Window of

Opportunity

to Market

Time-to-Market

Reduction

2%

44%

54%

35%

38%

18%

9%

12%

21%

26%

15% 14%

10%

0

20

40

60

80

100

2%

Unimportant

Important

Critical

1 year

after ATP

2 years

after ATP

5 years

after ATP

More than 5 years

after ATP

0 - 11 months

12 - 23 months

24 - 35 months36 - 47 months

48 or more months

No project

without ATP

Don't know

Source: Business Progress Reports for 974 applications being pursued by 464 companies in 256 ATP projects funded 1993-1997. Percent of Applications

Figure 8. Importance of Market Timing

The importance of speed-to-market is considered “important” or “critical” for 98 percent of applications;

it is considered "critical" for more than half. Further emphasizing the importance of acceleration, the

window of opportunity for 73 percent of the applications to enter the marketplace is considered to be

within two years after ATP funding ends; i.e., it appears that companies believe they would miss the

opportunity, or a significant part of it, without the acceleration enabled by ATP funding. 

The following are some additional business goals cited in company business reports:

"Be #1 supplier of ... technology"

"Obtain a licensee by end of ATP"

"Become global expert in ... technology"

"Diffuse technology to cover 5 technology niches"

"Increase market share by ..."

"Be recognized as leading vendor of ..."
 13

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Note: Some companies reported more than one strategy as "Primary."

Source: Business Progress Reports for 972 applications being pursued by 462 companies in 256 ATP projects funded 1993-1997.

Produce Product or

Service In-House

Adopt Process for

In-House Use

Primary

Secondary

Possible

N/A

27%

10%

62%

13% 15% 13% 14%

0

20

40

60

80

100

46%

29%

18%

34%

19%

License to

Others

Primary

Secondary

Possible

N/A

Primary

Secondary

Possible

N/A

Percent of Applications

Figure 9. Strategies for Commercializing ATP-funded Technologies

Identification of Commercialization Strategies

As their primary means of commercialization, most ATP-funded companies plan to achieve

commercialization for at least one application through production of a product or service in-house, in

their own existing or planned facilities. Some companies indicated more than one primary means of

commercialization for a given application. As shown in Figure 9, in-house production is the focus for

62 percent of applications. For 29 percent of applications, licensing to others is the primary strategy;

for 47 percent of applications, licensing is the primary or secondary means of commercialization. For

81 percent of applications, including some of those where in-house production is the primary means,

licensing to others is at least a possible supplementary means, if not the primary focus. Thus companies

recognize the opportunity to increase their revenues beyond what their internal production facilities can

support, while at the same time increasing opportunities for diffusion of the technology to other firms

and potentially other applications and industries. The potential for licensing the technology to others

is a factor that makes economic spillovers relatively more likely (Jaffe, 1996).

Close supplier-customer linkages are important to successful technological innovation. Among the work

that addresses this issue, von Hippel suggests that such linkages can increase the productivity of the

innovation through more efficient communication of technological and market information (von Hippel,
14

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports for 971 applications being pursued by 462 companies in 256 ATP projects funded 1993-1997. Primary Secondary Possible N/A

With

Suppliers

With

Customers

Joint

Production

With

Distributors

31%

24%

31%

15%

29%

14%

31%

17%

35% 33%

19% 21%

0

20

40

60

80

100

13% 14%

28%

45%

Primary

Secondary

Possible

N/A

Primary

Secondary

Possible

N/A

Primary

Secondary

Possible

N/A

Percent of Applications

Figure 10. Strategic Alliances Planned

1994). Given the large number of small companies involved in the projects, and the rather early stages

of production they address, one would expect a large number to pursue strategic alliances for

commercialization. But Figure 10 shows that one-fourth or less of applications involve heavy reliance

on strategic alliances with customers, suppliers, partners in joint production, or distributors, looking at

each type of alliance individually.

Further analysis, however, reveals that (a) 94 percent of companies plan at least one of these types of

alliances and (b) at least one of these types of alliances is planned in pursuing 90 percent of applications

(graph not presented). 

The subset of reports from small businesses reveals that strategic alliances to pursue commercialization

are more important for small businesses than for larger ones, as one would anticipate. Small businesses

plan alliances with customers as a primary strategy for 31 percent of applications and as a primary or

secondary strategy for 49 percent of applications (compared with 24 and 38 percent respectively for all

respondents); small businesses plan alliances for joint production as a primary strategy for 20 percent

of applications and as a primary or secondary strategy for 44 percent of applications (compared with 15

and 32 percent respectively for all respondents); small businesses plan alliances with distributors as a

primary strategy for 20 percent of applications and as a primary or secondary strategy for 39 percent of

applications (compared with 13 percent and 27 percent respectively for all respondents). 
 15

*

The 62 projects for which only a Baseline Report was available were dropped from these analyses of actual

progress. Of the remaining 199 projects, 119 had completed one-to-three years of ATP funding and had

anniversary reports available; 80 had completed a close-out report. (See Chapter 1, Table 1.) No post-project

information was available. The most recent anniversary and/or close-out report from each project participant was

used.

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports for 413 organizations in 198 ATP projects funded 1993-1997--

 after one or more years of ATP funding.

Current level of progress:

In completing the

ATP-funded project

In completing all R&D needed for

commercialization (i.e., to begin

product development/clinical 

trials, and full commercialization)

31% 32%

34%

24% 22%

19%

11%

16%

3% 8%

0

20

40

60

80

100

<10%

10 - 24%

25 - 49%

50 - 74%

75 - 100%

<10%

10 - 24%

25 - 49%

50 - 74%

75 - 100%

median = 61% median = 41%

Percent of Organizations

Figure 11. R&D Status

3. R&D STATUS

Level of Progress in Completing R&D Phase

Chapter 3 and the remainder of this study focus on actual progress against project plans and ATP goals.*

Figure 11 provides a picture of the R&D status of project participants. It indicates that 11 percent were

less than 25 percent complete; 31 percent were 75-100 percent complete with their R&D, which

corresponds with the growing number of organizations that have completed the ATP funding period.

The median level of completion of the ATP project is estimated for the group in the database to be 61

percent. Considering the total R&D (including that beyond the ATP project) needed for significant

commercialization to occur, the median level of R&D completion is estimated to be 41 percent. 
16

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

0

20

40

60

80

100

86%

1%

9%

4%

24%

14%

55%

6%

1%

Position in R&D cycle,

as a result of ATP award

"Ahead" in R&D cycle,"

by how much*

Ahead

Behind

Unchanged

Don't Know

No project

without ATP

< 1 year

1 - < 3 years

More than 3 years

Not sure

Note: *Include responses from organizations indicating "Ahead" to prior to question.

Source: Business Progress Reports from 412 organizations in 198 ATP projects funded 1993-1997--after one

 or more years of ATP funding.

Percent of Organizations

Figure 12. Acceleration of R&D

These two median values mean that 50 percent of the organizations have completed at least 61 percent

of their ATP-funded projects but only 41 percent of the total R&D needed for full-scale

commercialization. The fact that considerable additional R&D will be required for many organizations

after the ATP funding period ends is not surprising given that ATP is funding relatively early-stage

applied R&D with considerable technical risk.

Effect of ATP Funding on R&D Progress

Project participants indicate that they are significantly ahead in their R&D cycle as a result of ATP

funding as compared with where they would be without their ATP award. As shown in Figure 12, 86

percent indicate that ATP funding has helped accelerate R&D efforts in the ATP-funded area. Of these,

24 percent believe they would not have pursued the R&D at all without the ATP award; 55 percent

believe they are one to three years ahead as a result of ATP funding. Only one percent indicated they

were behind. Overall, measurable progress appears to have been made towards meeting critical windows

of opportunity for the ATP-funded technologies.
 17

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

14%

0

20

40

60

80

100

18% 19%

25% 25% 23% 24% 24% 24% 25% 24% 24%

12%

8% 8%

1% 2%

% of projects expecting first revenues

from ATP-funded technology in this

time period.

% of companies expected first revenues

from ATP-funded technology in this

time period.

% of applications across all companies

and projects for which first revenues are

expected in this time period.

During

ATP

< 1 Year

After ATP

1 - < 2

Years After

ATP

Within 2 - < 4

Years After

ATP

4 or More

Years After

ATP

Never

Figure 13. When Can We Expect To See Revenues from ATP-funded 

Technologies?

When Can Revenue Be Expected?

Although the ATP funds R&D that involves considerable technical uncertainties and difficulties,

technical progress tends to come in stages. Early-to-intermediate stage accomplishments may have

commercial value worth capturing by incorporating newly gained knowledge in a near-term generation

of products and processes even though attainment of the ultimate goals required for the full spectrum of

applications remains distant. 

A significant amount of commercialization planning activity is expected over the course of the ATP

project, and some projects are expected to experience the beginnings of revenue generation from spin-off

activities. Across the projects, companies, and applications encompassed by this report, 14 percent of

the projects expect to see some revenues from at least one early application of the ATP-funded

technology by the end of the ATP funding period. (See Figure 13.) For 61 percent of the projects,

revenue is not expected until a year or more after the end of ATP funding; for 12 percent of projects,

revenues are not expected until four or more years after the end of ATP funding. Only one percent of

organizations indicated they do not expect to earn revenues at any time. These include universities and

other joint venture members without a significant commercialization role, although they might be

performing testing and other services important to future commercialization by companies in their joint

ventures.
18

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Small, young companies, such as the large number of start-ups the ATP has funded, typically strive for

early spin-off products and joint-development contracts with other companies to generate cash flow

needed for financial survival. Taking advantage of early revenue opportunities may help them attract the

private capital needed to pursue the breadth of technological development required to compete in costsensitive markets, and for a broad range of potential applications. From observation of ATP-funded

companies involved in manufacturing of advanced products and from analysis of individual company

reports, it appears that at any given time many of the companies are engaged in a mix of R&D and related

commercialization activities involving a single core technology. These activities may feed into the

development of several different generations of products, including some entirely new product lines,

which will enter the marketplace at different times over the next five or more years. In the case of biotechnologies for human therapeutics, for example, early applications may involve research tools and test

kits. Significant commercialization of the targeted human medical therapeutics may not be possible for

five or more years after ATP funding ends because of the lengthy regulatory processes required.

The remainder of this report describes the effects of ATP funding, actual commercialization progress,

and the beginnings of technology diffusion, within the context of the relatively early R&D stage of many

of these projects. Substantial technical uncertainties remain, and full business and economic potential

are very difficult to predict in the face of both technical and economic uncertainties still remaining at this

time. These caveats notwithstanding, early effects of ATP funding are identified and conditions

necessary for significant future commercial success and national economic impact are monitored. With

the further passage of time, and additional data collection and analysis, we will learn much more about

the evolution of these projects. The ultimate outcomes of most ATP-funded projects will not be known

for a number of years after ATP funding ends.
 19

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Has your project 

involved collaboration

with other organizations?

Great Extent

Moderate Extent

Slight Extent

Not at All

Not sure

Note: *Includes responses from organizations indicating "YES" to prior question.

Source: Business Progress Reports from 415 organizations in 198 ATP projects funded 1993-1997--after one

 or more years of ATP funding.

0

20

40

60

80

100

To what extent is ATP responsible

for the collaboration?*

14%

86%

69%

19%

8%

3% 1%

NO YES

Percent of Organizations

Figure 14. Stimulation of Collaborations

4. STIMULATION OF COLLABORATION AND 

RELATED EFFECTS

Stimulation of R&D Collaboration

Stimulation of collaborative R&D relationships among companies, universities, and other research

organizations is part of ATP's legislated mission. The objectives are to increase research efficiency and

effectiveness, expand capabilities, reduce R&D cycle time, and accelerate commercialization and

competitiveness. The level of collaborative activity has been considerable from the beginning of the

program. In the first competition, ATP funded five joint venture projects among the first 11 awards.

From 1990 through 1999, the ATP funded 157 joint ventures, involving over 750 participants. Many

of these joint ventures involve companies which had never worked together before and were formed

explicitly to apply for ATP funding (Silber, 1996, p. 23). Of the 424 organizations in 199 FY 1993-1997

projects for which data are available after one or more years of ATP funding, 298 are members of 73 joint

ventures. (See Chapter 1, Figure 2.) In addition to the formal joint ventures, the ATP has found that most

of the "single company projects" it funds are, in fact, also rich in collaborative relationships. These are

implemented through subcontracting arrangements and informal alliances. 
20

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

0

20

40

60

80

100

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Slightly

Not At All/

Not Sure

55%

31%

13%

47%

33%

15%

5%

43% 42%

12%

3%

72%

25%

2% 1%

46%

34%

12%

8%

1%

Obtain R&D

expertise

Accelerate entry

into marketplace

To save time,

in general

Stimulate creative

thinking

Encourage future

collaborations

Note: Includes responses from organizations indicating "YES" to question--Has your project involved collaboration with other organizations?

Source: Business Progress Reports from 415 organizations in 198 ATP projects funded 1993-1997--after one or more years of ATP funding. Percent of Organizations

Figure 15. Effects Most Enabled by Collaboration

As shown in Figure 14, 86 percent of respondents reported their ATP project involved collaboration with

other organizations. Of the group indicating their project involved collaboration, 69 percent indicated

that the ATP was responsible for the collaboration to a great extent. Eighty-eight percent indicated ATP

was responsible to a moderate or great extent. 

As indicated above, many ATP collaborations reach beyond the formal joint venture relationship. Both

single company award recipients and joint venture members form collaborative relationships through

subcontractor arrangements and informal alliances. A total of 581 subcontractor arrangements, for

example, have been reported by single company awardees and joint venture awardees filing BRS reports.

Fifty-two percent of the subcontractors reported are small companies. Universities comprise 30 percent,

and 18 percent of these subcontractors consist of medium-to-large companies, government-funded

laboratories, and non-profit laboratories. 

Collaboration Effects

Figure 15 shows effects most significantly enabled by ATP collaborations of these multiple types. At

least 80 percent of respondents indicated that collaboration enabled these effects significantly or

moderately. Ninety-seven percent indicated that collaborations had "stimulated creative thinking;" 80

percent indicated that collaborations had enabled the company to accelerate entry to the marketplace, and

85 percent indicated a general time savings (corroborating acceleration effects cited in Chapter 3); 86

percent reported that collaboration had enabled the company to obtain R&D expertise; and 80 percent

indicated that their experiences with ATP collaborations had encouraged them to consider future

collaborations.
 21

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

100

0

20

40

60

80

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Significantly

Moderately

Little/None

Not Sure

Identify

customer

needs

Ensure

reliable/quality

source of supply

Save

labor

costs

Save

equipment

costs

Plan for

manufacturing

during R&D phase

42%

27% 27%

4%

25% 27%

40%

8%

20% 20%

54%

6%

30%

23%

38%

9%

26%

17%

47%

10%

Note: Includes responses from organizations indicating "YES" to question--Has your project involved collaboration with other organizations?

Source: Business Progress Reports from 415 organizations in 198 ATP projects funded 1993-1997--after one or more years of ATP funding.

Percent of Organizations

Figure 16. Other Effects Enabled by Collaboration

Figure 16 shows other effects of ATP collaborations. Among the other effects analyzed, "identifying

customer needs" was cited as significantly or moderately enabled by 69 percent. Over 50 percent of

respondents reported “ensuring a reliable/quality source of supply” and "labor cost savings" as significant

or moderately enabled by collaboration; “planning for manufacturing” was cited by 40 percent; and

"saving equipment costs" was cited as significantly or moderately enabled by 43 percent. These effects

may be indicative of the relatively early project stage of many of the projects, and some may become

more important as the companies move closer to commercial deployment.

There is no doubt that R&D joint ventures/consortia involve some project start-up time and costs, and

possibly continuing costs not experienced by single-company awardees. However, these difficulties

appear to have been relatively insignificant for the vast majority of ATP participants. As shown in Figure

17, of the organizations which reported collaboration experience in their ATP project, only nine percent

reported a significant cost increase, although nearly half confirmed that project coordination and

management costs had increased moderately as a result of collaboration. Eighteen percent indicated that

associated delays in starting projects had resulted significantly or moderately as a result of collaboration,

and only eight percent anticipated a delay of product entry into the marketplace as a result. 
22

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report Significantly Moderately Little/None Not Sure Significantly Moderately Little/None Not Sure Significantly Moderately Little/None

Not Sure

0

20

40

60

80

100

4%

14%

80%

2%

9%

47%

41%

3% 2%

6%

86%

6%

Delay in

beginning R&D

phase

Increased project

coordination and

management costs

Delay of product

entry into

 marketplace

Note: Includes responses from organizations indicating "YES" to question--Has your project involved collaboration with other organizations?

Source: Business Progress Reports from 415 organizations in 198 ATP projects funded 1993-1997--after one or more years of ATP funding. Percent of Organizations

Figure 17. Costs Attributed to Collaboration

Anecdotal Comments

Anecdotal information from the BRS provides additional insight into effects of collaboration experienced

by ATP-funded organizations and amplifies the statistical analysis. Some comments elaborate on the

positive and negative impacts of ATP collaboration; others address issues not covered in specific

reporting questions. 

Obtaining expertise not otherwise available

"The work with our subcontractors [has] enabled us to utilize their expertise in fields [where we]

are not staffed. The interactions with our joint venture partners provide us access to work they are

doing in fields [where] we are not active." [Joint venture member]

"Critiques of work conducted independently [have] provided invaluable outside perspective to

stimulate creative thinking and exposed several oversights early in the development process."

[Single applicant]

"The breadth of experience brought in on these projects is extensive." [Joint venture member]
 23

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

"Excellent collaborative environment and complementary technical capabilities have improved the

quality of technical output and effectiveness of the team. There has been tremendous synergy

between the companies that are collaborating on this project. Each company brings a particular

expertise that the others don't have and which would be difficult to develop. Each party is an

enabler for the others." [Joint venture member]

"Collaboration has provided [us] with access to compounding, conversion, and fabrication

resources, complementary ... materials and technical expertise that would not otherwise have been

available." [Single applicant]

"In general, [subcontractor] has a wealth of experience and knowledge on ... processing and control.

Their insight has been a primary driver on overcoming several technical problems and developing

process simplifications." [Single applicant]

"Our collaboration with other partners has helped us to access first hand data for medical

vocabularies, and understand size and complexity of that data." [Joint venture member]

"Exposed to new ideas, technologies that would otherwise not have been exposed to. Enabled us to

leap forward with newer approaches into our architectural design." [Joint venture member]

"No one company has all the expertise required for the entire project. Collaboration has allowed

in-house knowledge to be directly available to the overall effort." [Joint venture member]

"Medical expertise and related product requirement insight would not have been possible from

within our own organization." [Single applicant]

"Through collaboration we have been able to bring experts in this field to our test facility and work

with live systems." [Single applicant]

"The principal benefit of the collaboration has been to bring together a diverse team of varied

expertise to address highly complex ... engineering problems. Systems development projects such

as ... require individuals with many different technical and clinical skills to be successful.

Collaboration has enabled us to bring professionals together from academia, the non-profit sector,

and industry in a way that would not be possible within a single medical center." [Joint venture

member]

Obtaining assistance from universities

"Our collaboration with [university] brought a very significant amount of experience in the basic

technology that is underlying the diagnostic tests that we are developing; testing of our methods and

comparison to those that they have developed in parallel allowed us to overcome technical hurdles

faster." [Single applicant]

"Our collaboration involves working with two universities and an equipment vendor. The

universities have done early work to explore ... possibilities. We have then followed up with more

results-oriented experiments. This saves us time in helping to identify things that work and provides

us with an estimate of the process regime in which decent results can be obtained." [Single

applicant]
24

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

"1. Significant input on optimized structural shape design from Dr....at [university]. 2. Structural

testing facilities and equipment at [university] utilized for testing ATP prototype shape. Could not

perform test with in-house laboratory facilities." [Single applicant]

"We have just begun the first phase of a collaboration with the ... center at [university], which

involves the use of their clean room facilities. Duplicating those facilities at [our company] would

have been completely impossible. In addition, we are being trained in various ... techniques, which

speeds up the research phase considerably. The only negative impact has been the time required

for setting up the legal structure of this collaboration." [Single applicant]

"There have been a number of positive collaboration effects, particularly with our work with the

[university]. He has a group of excellent students, that have helped us to produce ... software, better

... layout technology, and also increase our research standing in the community of international

researchers. Our company always had strong people working for it, but we have been able to

attract, and keep several very talented people because of the NIST funding and are grateful for this.

So I would say that the research collaboration with this university, sponsored through NIST has been

very positive." [Single applicant]

"Our ability to use subcontractors from academic medical centers has greatly improved our ability

to achieve the goals of our project. These collaborators have given us both a lab for testing and a

reality check on what works." [Single applicant]

"University students are exposed to industry as summer students so they become acquainted with the

needs of industry and the workings of an R&D industrial lab. The resulting collaborations result

in joint publications and patents. [Single applicant]

Learning more about potential markets and customer needs and accelerating entry into the

marketplace

"The most significant collaboration has come from securing a contract ... to install a pilot

demonstration.... This has facilitated a number of discussions which has identified the real customer

needs and therefore accurate functional and performance requirements of the products. In this

process the team at ... working on the project have been introduced to domain knowledge that would

have otherwise been difficult to obtain." [Single applicant]

"The manpower-multiplying and synergistic creative effects of using subcontractors has accelerated

the R&D process to make it possible to plan and begin to initiate business alliances for the

technology that capitalize on a fast-approaching market opportunity." [Single applicant]

“[We] have forged excellent strategic alliances with leaders in the ... industry which provide

valuable customer input and resources during the development stages of the technology and will

allow us to quickly commercialize this application." [Single applicant]

"Our collaboration with [a joint venture member] led to a rapid prototype development with a

strong emphasis on customer needs.." [Joint venture member]

"The partnership which was established for this ATP project is a true vertical partnership of

suppliers and a manufacturer. Unlike other R&D alliances in which [these companies] have

participated, which were horizontal partnerships of manufacturing companies, this project had no
 25

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

inherent conflicts of interest. There is a single motivation in this project: to advance the state-ofthe-art of the ... technology ... to allow for broad substitution of composites for traditional materials.

And to date the NIST/ATP project has been central to achieving this goal." [Joint venture member]

"The collaboration has allowed us to understand healthcare needs for the technology to which we

have been able to focus our R&D. This has greatly increased commercialization chances and

technology impact. Collaborator has already started to use our technology and has hired our

students as interns and employees, which represents an important form of technology transfer. More

collaboration has occurred than originally planned." [University joint venture member]

"In general, the collaboration has allowed us to contact new potential collaborators and markets.

Some of these markets are for new equipment using our technology in ways we had not considered.

Due to the success of the JV, the various members are investigating projects outside the ATP." [Joint

venture member]

"Without the joint venture and collaborations from the other members it would have been almost

impossible to assess the market needs and define the customers and requirements." [Joint venture

member]

"The vertical structure of our joint venture (2nd tier vendor, 1st tier vendor, OEM) assures that our

project direction is kept focused on real customer needs and addresses real customer concerns."

"Better coordination of program brainstorming to advanced technology has enhanced the

commercial focus. Has accelerated the commercialization effort." [Two members of a joint venture]

"Collaboration with [our JV members] has been extremely positive. All members of the group have

really worked together to solve common problems and foster creative solutions. This has allowed

all of us to gain greater speed to market." [Joint venture member]

"It has created a greater awareness of the complete HDTV product environment. It has allowed [us]

to pursue alliances outside of our narrowly defined ... product environment and work towards a

greater understanding of new product and services offerings." " Complex system architecture issues

are better studied in industry teams. This is made possible by the ATP grant." [Two members of a

joint venture]

"There have been no negative impacts. Positively, the collaboration has increased our awareness

of our partners' need for advanced materials and the partners' efforts in identifying opportunities

in emerging markets which might match our long-term R&D material development work." “Assisted

greatly in development of understanding of manufacturing costs and customer requirements,

eventually leading to the abandonment of the ... effort." [Two members of a joint venture]

"The collaboration would have happened, eventually, but ATP has been the catalyst. The program

has moved along much faster than anticipated and has been able to obtain managerial support and

external assistance which would not have happened without ATP affiliation." " Intercorporate

collaboration has fostered business relationships which are likely to continue beyond the ATP into

product development and commercialization. This should greatly accelerate the application of the

ATP-developed technology." [Two members of a joint venture]
26

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Formation of stronger supplier-customer relationships

"The other joint venture partners are also customers for [company]. General understanding of

business practices and other developmental needs have had a positive impact on all parties." [Joint

venture member]

"Our collaboration with the equipment vendor has led to a promising new area of development. We

hope to build a better _______ using their technology. It may allow us to surpass our original

throughput goals." [Single applicant]

"Established enhanced relationships with strategic suppliers of software necessary to perform our

... services, and to focus our software suppliers toward the directions we see as necessary in

developing the next generation of ... tools, techniques, and methodologies." [Joint venture member]

"Our subcontractor has a good deal of credibility in the marketplace. We have gone farther with

prospects and vendor alliance discussions because of the choice of the subcontractor." [Single

applicant]

"Collaboration has helped to align ideas of users and suppliers greatly." [Joint venture member]

"As an end user of the core technology being developed for this program, we would not have early

access to the technology without the collaboration. Collaboration at this phase allows us to

influence the design to meet our end product needs during the development. We have no intention

to manufacture the [component], but to use it in our product; therefore collaboration is essential."

[Joint venture member]

"There has been an awakening to the advantages of networking with our suppliers on an informal

basis. This has resulted in leveraging research within [our] supply chains." "The collaboration with

[lead company] has given us much insight and understanding as to the interests, needs, values, and

talents of one of our largest international customers." "Without collaboration on this project with

a major customer, this project probably would not exist. Collaboration provides us an unusual

opportunity to work together." [Three members of a joint venture]

Strengthening credibility within the organization and with other organizations

""The fact [our company] has an ATP award has added credibility to our commercialization effort

and in fact it has attracted some of our early collaborators and has been a major source of interest

for our partners." [Single applicant]

"There is heightened credibility obtained from the concurrence of our competitors that we are doing

the right things; i.e., if we tried to get this project approved in house alone, it might be perceived to

not be as big a problem." [Joint venture member]

The joint venture with [partner] has focused our R&D effort to a specific application and our price

performance objective.... We anticipate the most significant impact will come in the near future when

[partner] can assist us in gaining the capital investment for the transition to manufacturing and in

the well-established market share [partner] currently enjoys." [Joint venture member]
 27

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

"Provided visibility into automotive market segment which we wouldn't normally have had access

to." [Joint venture member]

"Through our collaboration with [our subcontractors] we now have access to potential customers

(the colleagues of our collaborators) who would have been less receptive had we approached them

on our own." [Single applicant]

Elaboration of the "benefits and costs" of collaboration

"This vertical teaming has enabled a free flow of ideas between the two companies and has made

this collaboration a positive experience to date. The only negative of the collaboration, which is a

result of the "large company syndrome," is that while large companies such as ... offer tremendous

manufacturing resources, scheduling these resources can be difficult at times." [Joint venture

member]

"The main positive of collaboration is the sharing of expertise, and the stimulation of new

approaches to the problem. The main negative has been that one of the companies was not really

committed to provide sufficient resources to execute tasks on schedule and this slowed down all tasks

in the critical path. Another negative (not major) has been the added approvals to change program

directions, and the slow down in schedule due to co-ordination of tasks (technical and

administrative)." [Joint venture member]

"Positive: Reduction of "not invented here syndrome"; reduction of capital cost on equipment

available from JV partner; positive factor in negotiating other contract research with outside

company that involves complementary technologies of both JV partners. Negative: Difficulties

experienced in initial collaboration with JV partner revolving around issue of trust (viewing the

other company as a potential competitor)." [Joint venture member]

"Positive: Direct contact with potential customer led to development of a prototype that matched

customer needs. Exposure to different management and engineering approaches contributed to

improvements/evaluation of our respective processes. Negative: Collaboration of multi-disciplinary

teams located in various geographical locations was difficult. Different companies had different

priorities and goals that at times conflicted with program goals." [Joint venture member]

"Positive Impacts: Elevated awareness of Healthcare marketplace. Understanding the healthcare

information technology requirements. Negative Impacts: Very difficult to settle the intellectual

property rights between multiple collaborators." [Joint venture member]

"On the positive side, there was a great exposure to other technologies and transfer of technical

knowledge between large multinational companies and research institutions. On the negative side,

the research has been delayed because of the effort required to establish collaborative agreements

and work through conflict resolutions." [Single applicant]

"On the positive side, the collaboration has allowed a group of companies to come together that

otherwise wouldn't have and work jointly through a leveraged investment of R&D efforts. On the

negative side, not all of the business models of the participating companies were compatible which

resulted in some serious business negotiation problems relative to intellectual property." [Joint

venture member]
28

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Formation of Strategic Alliances Outside the ATP Project for Commercialization

of ATP-funded Technologies

The numerous ATP joint ventures represent concrete evidence of ATP's ability to stimulate strategic

alliances. Some are largely horizontal R&D collaborations attacking problems of mutual interest across

an entire industry. Most involve complex R&D and commercialization collaboration across the supply

chain. For example, one project in the area of photonics manufacturing brings together a vertically

integrated team of photonics manufacturing companies supplying optical devices (SDL, Inc.), and

network systems (Nortel Systems) with software developers (RSoft and Hewlett-Packard as a

subcontractor), consulting service providers (Telcordia Technologies and Science Applications

International Corp.), and Columbia University. Led by Telcordia Technologies (formerly Bellcore), the

project aims to develop an open architecture, integrated simulation tool for evaluating photonic

components, systems, and network designs quickly, reliably, and inexpensively, and thereby reducing

design-build-test cycle times across the supply chain of the communications sector by a factor of five,

with potential application to other industries. Another project, led by Xerox, brings together a number

of manufacturers with different applications of micro-opto-electro mechanical systems (MOEMS), a

university, and a commercial foundry jointly to develop infrastructural process technologies supporting

mass production of MOEMS at low cost. Ultimately each manufacturer (Xerox, Maxim Integrated

Products, Microcosm Technologies, MicroScan Systems, and Optical Micro-Machines) will co-develop

with the foundry (Standard Microsystems) its own products employing the technologies developed in the

ATP project. These products span applications in telecommunications, imaging, medicine, entertainment,

and information systems. The research joint venture between 3M Company and Perkin-Elmer

Biosystems funded by the ATP in 1998 has resulted explicitly in joint commercialization plans. Building

on the foundation provided by their ATP project, 3M Company and Perkin-Elmer Biosystems have

entered into an agreement to jointly develop genetic analysis products. This agreement facilitates an

anticipated long-term complementary relationship leveraging 3M’s strengths in material science and

manufacturing and Perkin-Elmer’s capabilities in genetic analysis.

Some relationships between ATP-funded companies and their R&D subcontractors have evolved into

strategic alliances for commercialization. Among the publicized alliances, PharmaSeq (a one-person

start-up company when funded by the ATP in 1998) and Sarnoff Corporation, one of the subcontractors

on the ATP project, announced an agreement in early 1999 to develop jointly a prototype system that

integrates PharmaSeq’s novel DNA diagnostic method employing an assay of 3-D arrays of DNA

molecules with Sarnoff’s microtransponder technology. The aim of this alliance agreement is a highly

accurate and cost efficient DNA detector system for use in biomedical research, drug discovery,

infectious agent monitoring, genomics, industrial processing, and environmental monitoring.

Many other strategic alliances have been formed outside the ATP research project to commercialize ATPfunded technologies. Although information concerning negotiations with potential commercialization

partners, and the resulting alliances, is provided to ATP on a confidential basis, articles published by the

industry and trade press and company press releases sometimes provide public substantiation. Public

sources confirm that partnering between ATP-funded small businesses developing DNA diagnostics

technologies and pharmaceutical and medical instrumentation companies has been particularly active.

Integra LifeSciences, recipient of ATP awards in 1993 and 1998, has announced strategic alliances with

Linvatec and Bionx for developing fixation devices, e.g., screws, tacks, and anchors, using Integra’s

polymer technology funded in its first ATP award for reconstruction of ligaments and tendons in knees

and shoulders. Affymetrix, a 1994 award recipient in the Tools for DNA Diagnostics Focused Program

competition, has recently entered into agreements with OncorMed to collaborate in development of

clinical validation of genetic testing services utilizing their GeneChipTM for analysis of genes associated
 29

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Number of

Projects

Number of

Companies

Number of

Applications

Negotiations/discussions held with

potential strategic partners

97 113 184

Alliances formed with suppliers 37 37 48

Alliances formed with customers 49 52 71

Alliances formed for joint production 34 37 45

Alliances formed with distributors 30 30 39

Total alliances formed 150* 156* 203

Negotiations/discussions held with

potential licensing partners

53 53 81

License agreements signed 42 42 59

Note: *Companies reporting more than one type of alliance are included twice.

Source: Business Progress Reports for 747 applications being pursued by 356 companies in 198 ATP projects funded 1993-1997 –

after one or more years of ATP funding.

Table 3. Strategic Alliances and Licensing Agreements for Commercialization

with cancer. Under a separate distribution and instrumentation alliance between Affymetrix and HewlettPackard, Hewlett-Packard is developing and supplying a next-generation scanner to read the GeneChipTM

(Regalado, 1996, p. 22). Affymetrix has other collaborations with Genetics Institute, Roche Molecular

Systems, Incyte Pharmaceuticals, and Glaxo Wellcome (Regalado, 1996, p. 18). Hyseq, a tiny company

funded by the ATP to develop a different DNA chip technology, has teamed up with Perkin-Elmer to

market its chips (Perkin-Elmer and Hyseq Press Release, June 29, 1998). All of these partnerships are

outside the ATP projects, but occurred while the ATP-funded R&D was ongoing relatively early in the

R&D phase as a means of accelerating commercialization of the ATP-funded technology and raising

capital for continuing R&D. 

Table 3 summarizes strategic alliance activity focused on commercialization of technologies funded by

the ATP during 1993 to 1997. The data reveal that a substantial amount of negotiation and discussion

activity is underway. One hundred fifty-six alliances had been formed by March 31, 1998: 37 with

suppliers; 52 with customers; 37 for joint production; and 30 with distributors. Forty-two license

agreements had been signed by that time. Some of these alliances for commercialization evolve from

R&D partnerships among ATP joint-venture companies, but many companies are forming alliances with

companies outside of their ATP projects.
30

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

0 20 40 60 80 100

As a result of the ATP award, industry R&D investment in the ATP-funded technology area has:

Percent of Organizations

Increased -

No project without ATP*

Increased over what

it otherwise would have been**

Stayed the same

Decreased

Don't Know

Notes: * These organizations believe their projects could not have been undertaken without ATP funding. Their industry cost share,

 estimated to be $183 million, represents an increase in private sector R&D investment in the ATP-funded technology area.

 ** These organizations estimate their own R&D investment in the ATP-funded tehcnology area increased by $145 million

 as a result of the ATP award. It represents increased industry funding in additon to the ATP funding. 

Source: Business Progress Reports from 412 companies in 198 projects funded 1993-1997--after one or more years of ATP funding.

36%

38%

21%

1%

4%

Figure 18. Stimulation of Industry R&D Investment

5. IMPACT ON INDUSTRY R&D

Stimulation of Private Sector Investment and Leveraging of Other Investment

More than one-third of the organizations reporting believe there would have been no project at all without

ATP; i.e., their combined cost-share commitment of $183 million reflects an investment that they say

would not have occurred at all without the ATP award. An additional 38 percent report they increased

their investment in the ATP-funded technology area as a result of ATP funding, beyond what the

investment otherwise would have been, by $145 million in the aggregate. (See Figure18.) 

According to the responses from the two groups of organizations combined, ATP has stimulated industry

to invest more than $320 million in internal company funds beyond what industry would have invested

without the ATP awards (and above and beyond ATP funding). The increased industry investment

represents an estimated 58 percent increase over what industry would have invested without ATP

funding. The increased level of funding from industry sources, plus that from the ATP, has helped to

accelerate the R&D for ATP-funded projects and thereby has helped the companies enter the market

within the critical windows of opportunity. (See Chapter 2.)
 31

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports from 403 organizations in 198 ATP projects funded 1993-1997--

 after one or more years of ATP funding.

Expanded R&D scope 61%

Percent of Organizations

0 20 40 60 80 100

73%

67%

71%

More willing to accept

technical risk

Increased interest in

long-term research

Increased interest in

collaboration

Figure 19. Change in the Nature of Industry R&D

As shown in Figure 19, 61 percent of the organizations indicated that they had increased the R&D scope.

Sixty-seven percent reported that ATP funding had increased their interest in long-term research. Both

scope expansion and longer-term research give rise to increased challenge. Seventy-three percent of

organizations reported they were more willing to accept technical risk as a result of ATP funding. Many

of the remaining organizations reported they would not have pursued the project at all without ATP

funding. From the combination of these various sets of data, it appears that ATP funding has stimulated

pursuit of higher risk, longer-term, more ambitious R&D projects than would have been undertaken

without ATP funding. 

Increased Credibility

A large percentage of organizations that have completed one or more years of funding cite increased

credibility or enhanced prestige as a result of the ATP award, documenting that the ATP award has a

"halo effect" on organizations and technologies receiving awards, apart from the award's monetary value.

The most frequently cited "halo effect" was by researchers with "upper" management (or owners) in their

own organizations. As shown in Figure 20, respondents from 85 percent of all the organizations reported

increased credibility with management; 75 percent indicated improved credibility with customers; 60

percent with suppliers; and 44 percent believed the ATP award had a "halo effect" with investors.

Ninety-three percent of organizations reported increased credibility with one or more of these parties.

The "halo effect" may be expected to be of particular benefit to ATP-funded small businesses,

particularly start-ups, which have little if any market presence and typically very limited financial

resources at th resources at the time of the ATP award. A comparison of results for the small companies
32

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Note: Ninety-three percent of organizations reported increased credibility with at least one of these parties. 

Source: Business Progress Reports from 412 organizations in 198 ATP projects funded 1993-1997 -- 

 after one or more years of ATP funding.

With Management 85%

With Customers

With Suppliers

With Investors

Percent of Organizations

0 20 40 60 80 100

75%

60%

44%

Figure 20. Increased Credibility

Note: Ninety-five percent of small businesses reported increased credibility with at least one of these parties. 

Source: Business Progress Reports from 150 organizations in 118 ATP projects funded 1993-1997 -- 

 after one or more years of ATP funding.

With Management 84%

With Customers

With Suppliers

With Investors

Percent of Organizations

0 20 40 60 80 100

89%

73%

73%

Figure 21. Increased Credibility – Small Businesses

versus the entire group shows that the “halo effect” with outside firms and investors was indeed stronger

for small businesses than for the group as a whole. Small businesses likely have greater need for this

assistance and therefore have greater sensitivity to its benefit.
 33

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Have you received any 

new (external) funding 

supporting the ATP-funded 

technology or its 

commercialization?

Note: *Includes responses from organizations indicating "YES" to prior question.

 Organizations report receiving over $200 million in new (external) funding to support ATP-funded technologies or their commercialization.

Source: Business Progress Reports from 412 organizations in 198 ATP projects funded 1993-1997--after one

 or more years of ATP funding.

New capital received from:*

82%

Percent of Organizations

18%

40%

4%

12%

40%

26%

32%

NO YES

0

20

40

60

80

100

Owner/Angel

Venture Capital

Stock Offering

Long-term Financing

Federal Grants & Contracts (non-ATP)

State/Local Governments

Other/Corporate Partners

26%

Figure 22. Attraction of Capital

As shown in Figure 21, 89 percent of small business experienced increased credibility with customers

(compared with 75 percent for the group as a whole); 73 percent with suppliers (compared with 60

percent for the group as a whole). Some anecdotal examples of “halo effects” related to joint venture and

other ATP-stimulated collaborations are included in Chapter 4.

A significant number of organizations have attracted new sources of capital following announcement of

their ATP award. The new funding has gone to support the ATP-funded research area or related

commercialization efforts. Of the 412 organizations reporting after one or more years of ATP funding,

76 (18 percent) had received new funding from external sources, amounting to more than $200 million,

to pursue their technology development and commercialization activities. 

As shown in Figure 22, the most common sources of new funding were owner/angel/friends capital

contributions, non-ATP Federal grants and contacts, and other/corporate partners. Some companies report

receiving more than one type of funding.

In general, the new federal funding appears to support R&D in technology areas related to the ATPfunded technology but outside the scope of the ATP project; state funding appears directly to support

ATP-funded research by companies, thereby leveraging ATP and private cost-share funds, for example,

from owner/angel/friends, venture capital, and internal sources. 
34

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports from 747 applications being pursued by 356 companies in 198 ATP projects funded 1993-1997--

 after one or more years of ATP funding.

84%

% of projects for which this activity 

has been conducted for at least one 

application

Completed product/

process definition

0 20 40 60 80 100

% of companies for which this activity 

has been conducted for at least one 

application

% of applications across all projects 

and companies for which this activity 

has been conducted

73%

65%

70%

54%

44%

63%

44%

34%

Conducted concept

testing with customers

Conducted other market analysis

activities (product/process

development and testing,

sales/revenue forecasting, other)

Figure 23. Market Analysis Progress

6. EARLY COMMERCIALIZATION ACTIVITIES

Even for applications where commercial production is several years off, successful, timely entry into the

marketplace is likely to entail a significant level of effort in market analysis, capital planning and

acquisition, and negotiation with potential partners over the entire R&D phase. The trend to shorter

product life cycles in many industries dictates that companies engage in market analysis and planning

for manufacturing and scale-up from the earliest stages of R&D in order to have a new product or process

ready in time to compete successfully in international markets (See Laidlaw, Chapter 1, 1997). ATP

monitors this activity as part of its project management and evaluation process both to assess the

likelihood that successful commercialization will result and to measure the level and significance of

progress. This chapter provides a statistical snapshot of commercialization progress for companies

reporting after one or more years of ATP funding, along with some specific examples from individual

companies and projects.

 

Commercialization Planning Activities

As shown in Figure 23, companies in 84 percent of the projects have completed product/process

definition for at least one application; companies in 70 percent of the projects have completed concept

testing with customers for at least one application; and concept testing has been conducted for 44 percent

of all applications being pursued. 
 35

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports for 672 product or process applications being pursued by 330 companies in 191 ATP projects funded 1993-1997--

 after one or more years of ATP funding.

64%

% of projects for which this activity 

has been conducted for at least one 

application

Completed production

prototype

0 20 40 60 80 100

% of companies for which this activity 

has been conducted for at least one 

application

% of applications across all projects 

and companies for which this activity 

has been conducted

52%

43%

55%

42%

32%

22%

14%

10%

Completed pilot production/

commercial demonstration

Began production

Figure 24. Progress Towards Commercial Production

Companies are engaged in the long-term process of planning for scale-up from preparation of smallsample prototypes to commercial production. As shown in Figure 24, 52 percent of companies,

participating in 64 percent of projects, indicate they have completed a production prototype, and 42

percent of companies participating in 55 percent of projects have completed pilot production or a

commercial demonstration for at least one application of the ATP-funded technology. A small

percentage of the companies (14 percent of companies from 22 percent of the projects) indicate they have

actually begun production for at least one application. Production has begun for 10 percent of

applications.

Figure 25 provides a statistical summary of early progress towards earning revenues or other benefits

from use of the ATP-funded technology. Fifty-four percent of companies, participating in 66 percent of

the projects, believe they are now able to make a new or better product as a result of their ATP project;

39 percent of companies, participating in 51 percent of projects, have adopted process improvements

embodying ATP-funded technology; 17 percent of companies, participating in 27 percent of projects,

report revenues from sales of prototypes and early spin-off products that amounted to more than $67

million from 12 percent of applications by March 31, 1998. Licensing royalties, reported by four percent

of companies, amounted to $5 million by that date.
36

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports for 703 applications being pursued by 332 companies in 192 ATP projects funded 1993-1997 --

 after one or more years of ATP funding.

66%

% of projects for which this activity 

has been conducted for at least one 

application

Able to make new/better

product

% of companies for which this activity 

has been conducted for at least one 

application

% of applications across all projects 

and companies for which this activity 

has been conducted

Adopted process

improvements

Earned licensing royalties

$5 million reported

0 20 40 60 80 100

54%

48%

51%

39%

29%

27%

17%

12%

6%

4%

3%

Earned revenues from

products/services

> $67 million reported

Figure 25. Progress Towards Early Products and Processes

Early Commercial Products

A number of new products have been announced by ATP participants. Many of the earliest

announcements of commercialized ATP-funded technologies involve software products, which typically

have shorter development cycles than hardware products and are often marketed over the Internet. The

following are some examples from company press releases and product announcements. 

	
  	
 	
 
  


  
 
 

   
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report



   	
  
  
 

 

 



  

   

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Fragment Length Polymorphism for DNA Diagnostics. In mid 1996, Third Wave "launched its initial

product from its lead product platform, CleavaseR

 Fragment Length Polymorphism (CFLPR) developed

as part of its ATP project, into the life science research market." They had two distributors and over

$300,000 in sales by the end of the year. This product is part of the "tool box" of faster, cheaper, and

more user-friendly technologies for detecting and manipulating DNA that Third Wave is developing for

molecular human diagnostics applications such as assessing tissues for transplantation suitability, forensic
38

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

and paternity tests, diagnosing hereditary and infectious diseases, assessing susceptibility to specific

diseases, and monitoring the response of disease pathogens to specific medical treatments.

Anecdotal Comments

Anecdotal comments provided in the business reports help establish a clearer perspective for the

commercialization progress reported above at relatively early stages of the R&D. 

Ability to make new and/or better products

Many of the 54 percent who report an ability to make new and/or better products are not yet ready to start

commercial production. Market launch may be some years off; however, key technical barriers to

commercialization have been overcome.

"We are able to make ....drills with life expectancy 10-20X."

"We can now make good quality, repeatable automotive lighting fixture parts. The performance is

good, and samples have gone past the prototyping stage, and are now in the designed-in stage of

development."

"Five-inch diagonal proof of concept display built."

"We are now producing ... plugs made with insulators that have been injection molded using this

technology."

"We have taken an observation made just prior to ...ATP proposal... and transformed it into a

revolutionary product line ... that we manufacture and that are distributed by '2' of the world's

largest and most respected life science companies."

"We are able to make a better metrology product for the fuel injector industry. Based on test results

and direction from our strategic partner..., we have reduced the amount of residual instrument

error....Work continues ... to improve its thermal stability. Further, we have achieved better

accuracy while implementing phase diffractive optics."

"Higher density of the part was achieved. Extended the range of usable materials. Enhanced

magnetic properties."

"The ... database is clearly ahead of its time. With one more iteration, the database will likely be

ready for commercialization together with the software, which is now quite stable.”

Prototyping and customer testing

"We are currently conducting field molding trials at five different potential customers. A wide

variety of specialty electrical parts are being prototyped with significant positive response."

"Our first prototype fabrication allows us to make a manufacturing cost estimate based on

experience and known processes. It predicts [our product] will be at least 2X less expensive than

other optical technologies and competitive with comparably performing copper interconnections."
 39

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

"We have gone from concept to a demonstrable prototype and will soon have scalability and

performance data to match."

"We now have enough of the technology visible that we are discussing installation/evaluation with

a large number of companies."

Implementation of new or improved production processes

The 39 percent of companies reporting implementation of new or improved production processes

embodying some part of ATP-funded technology (Figure 26), in experimental or actual production lines,

further described early effects on production efficiency, costs, and/or product quality.

"Implemented continuous cable assembly fabrication technique, which should result in lower cost

cable assemblies."

"Robotic handling techniques have been introduced to the process to speed up post mold processing

and demonstrate the cost savings attributed to automation."

"There have been many offshoot process improvements resulting from ATP funding. Core

technology improvements in primer extension biochemistry have been adapted to our currently

commercialized platforms. Software improvements have been integrated across the company for

data analysis and reporting, enabling service lab volume to increase without an increase in data

analysis labor.

"Improved raw materials screening, improved process control and improved measures to assure

product consistency."

"We have reduced necessary on-site time by approximately one third and developed much better

reporting systems."

"From the process research that we have so far performed, we have improved our abrasive media

formulations, identified key process variables and have improved the control of these variables with

advanced controls and data collection.”

"We established a new way of casting ...with the proper coefficient of expansion as well as other

parameters such as 1) size, 2) thickness. This achievement is unique as only one in the industry has

been able to achieve same."

"ATP has enabled [us] to begin building an interoperability lab for testing interoperability between

different video and network devices from multiple vendors. This interoperability lab will enable us

to build better products and solve interoperability issues before products reach the field."

"We have developed engineering scale automated cleaning-in-place and testing systems for

membrane separations and are developing new applications."
40

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

20

40

60

80

100

Overall Competitive

Standing

Domestic

Conditions

International

Conditions

International

Trade Barriers

Entry of

New Competitors

Improved

Worsened

Unchanged

Unsure

Improved

Worsened

Unchanged

Unsure

Improved

Worsened

Unchanged

Unsure

Improved

Worsened

Unchanged

Unsure

Improved

Worsened

Unchanged

Unsure

Improved 42%

Worsened 14%

Improved 29%

Worsened 9%

Improved 13%

Worsened 11%

Improved 2%

Worsened 5%

Improved 5%

Worsened 23%

Percent of Companies -- for at least one Application

Source: Business Progress Reports for 725-726 applications being pursued by 348-349 companies in 197 ATP projects 

 funded 1993-1997--after one or more years of ATP funding.

Percent of Applications

32%

9%

55%

4%

22%

5%

68%

10%

7%

74%

9%

0

5%

1%

3%

83%

13%

3%

16%

73%

8%

Figure 26. Changes in Competitiveness

7. CHANGES IN COMPETITIVENESS

Trends in Competitiveness and Competitive Conditions

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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Competitor(s) pulled

into lead 7%

Percent of Applications

0 20 40 60 80 100

2%

17%

52%

7%

15%

Competitor(s) pulled

even

Competitor(s) advanced

but are still behind

Unchanged

Competitor(s) fell

behind

Not Sure

Source: Business Progress Reports for 769 applications being pursued by 366 companies in 197 ATP projects funded 1993-1997--

 after one or more years of ATP funding.

Figure 27. Status of Competitors

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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report


   
   

	


  

   
    
   



 
   

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 &"0

 
 	   
 
 

 	      


   

 	
   


  

     
    



 
 43

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Source: Business Progress Reports from 522 organizations in 260 ATP projects funded 1993-1997.

63%

Other

0

20

40

60

80

100

13% 12% 12%

29%

23%

20%

28%

51%

25%

16%

8%

6%

2%

17%

75%

Primary

Secondary

Possible

Unlikely

Primary

Secondary

Possible

Unlikely

Primary

Secondary

Primary

Possible

Unlikely

Secondary

Possible

Unlikely

Primary

Secondary

Possible

Unlikely

Patents Copyrights Trade Secrets

Percent of Organizations

Figure 28. Intellectual Property Strategies Planned

8. INTELLECTUAL PROPERTY PROTECTION AND 

DIFFUSION OF TECHNOLOGY

Protection and Disclosure of Intellectual Property

Protection of intellectual property through formal patent and copyright mechanisms provides legal

protection against use of an invention without permission or compensation. The patent or copyright

converts the intellectual property into a potential income-earning asset and, for many applications and

industries, is critical to the ability of the innovator to commercialize a new technology. In return for

patent protection, however, the innovator must agree to public disclosure of the patented invention and

(to a lesser extent) copyrighted material. Disclosure provides a means of attracting commercial partners

interested in licensing or joint production opportunities, and thus reinforces the private commercial

purposes of the intellectual property protection; however, it also is a mechanism for unintended

knowledge spillovers--to competitors or others who may be in a position to exploit the knowledge

without paying for it. (See Jaffe, 1996.) Patent and copyright activity is an important component of the

direct pathway to national economic benefits in that it provides necessary protections for ATP-funded

companies to commercialize their technologies profitably; simultaneously, it provides an indirect

pathway to national economic benefit through knowledge spillovers to others in a position to benefit from

the ATP-funded innovation.
44

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Papers in Professional

Journals

Papers Presented at

Conferences

Total Number of Papers 250 706

Number of Organizations Reporting Papers 74 186

Number of Projects Reporting Papers 64 143

Note: Across the 199 projects reporting, an average of 1.3 professional journal articles were published and 3.6 conferences papers presented per project. 

Thirty-two percent of the projects produced at least one professional journal article; 72 percent of the projects produced at least one conference paper.

Source: Business Progress Reports from 199 ATP projects funded 1993-1997– after one or more years of ATP funding.

Table 4. Dissemination of Non-proprietary Information from ATP-funded Projects

Both aspects of patent and copyright protection are important to achieving maximum commercialization,

diffusion, and social benefit of the ATP-funded technologies: Patent and copyright protection afford

ATP-funded firms incentives, in the form of protection of title to their innovations, to undertake costs of

product development and marketing needed to launch a commercial product, and may help open new

licensing and other partnering opportunities. The wider the commercial use of the technology and the

greater the spread of information concerning resulting products and processes, the greater the opportunity

for market spillovers to users and customers and for knowledge spillovers to others in a position to make

use of the knowledge for their purposes. 

Most companies report plans to protect intellectual property created in their ATP project, whether they

plan to produce in-house or to license the technology to others. As shown in Figure 28, patent protection,

copyright protection, and maintenance of trade secrets are listed respectively as primary strategies by 63

percent, 29 percent, and 51 percent of companies. A more detailed analysis (not shown) indicates that

eight percent of the companies listed all three strategies as primary; 13 percent listed both patents and

copyrights as primary; and 22 percent listed both patents and trade secrets as primary strategies. Thus

some combination of legal protection and secrecy/first mover advantages appears to be a common

strategy. Of course, to the extent that companies patent their technology they cannot expect to maintain

the same knowledge secret; but companies may identify some aspects of their technology best protected

by patent and other aspects best protected by secret, and thus combine the two strategies. 

Organizations receiving ATP awards in the FY 1993-1997 competitions report that the ATP-funded

technologies build on [and intellectual property rights are protected by] over 2,000 pre-existing patents.

Companies seeking title to new intellectual property created with ATP funding have reported to NIST

239 new patents filed, eight copyrights filed, and 23 patents issued. Often foundational patents predate

the ATP project, and the ATP project focuses on bringing the technology beyond a rough concept.

Dissemination of Non-Proprietary Information

Published papers, conference participation, news articles, press releases, and internet sites provide

additional dissemination of information about ATP-funded technologies. Many companies are very

active in publishing papers, issuing press releases, and making public presentations concerning their R&D

activities – some more than others. Universities and other research organizations, with the agreement

of the for-profit companies holding title to ATP-funded intellectual property, have also been active in

disseminating non-proprietary information about their ATP-funded technology development. Table 4

provides a summary of the activity through March 1998 in published professional journal articles and

conference papers alone.
 45

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

According to the BRS data, more than half the projects covered in this study have produced published

conference papers, and approximately one-fourth have produced published articles in professional

journals. On average, about 3.6 conference papers have been presented and 1.3 professional journal

articles published per project.
46

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

9. RELATIONSHIP TO PRIOR WORK AND CONCLUSIONS

Although nearly all the ATP projects funded 1993-1997 were still in the R&D phase as of early 1998,

an analysis of the business reports from 199 projects after at least one year of funding suggests that the

necessary conditions for achieving national economic benefits are evolving, although not necessarily at

the same rate or to the same extent for all projects.

Relationship to Prior Work

Findings from the BRS data are largely consistent with the findings of two third-party surveys of projects

not in the BRS. Silber & Associates surveyed projects funded from 1990 through 1992 after

approximately two-to-three years of funding (Silber & Associates, 1996). Solomon Associates surveyed

ATP's first competition awardees after just one year of funding (Solomon, 1993). The BRS captures

much greater detail than the third-party telephone surveys, explicitly covering the evolution of a myriad

of applications. And, of course, the BRS captures the voices of awardees directly without a third party

intervening. Although specific summary statistics differ somewhat, analyses of BRS data generally

confirm earlier survey results that ATP awards are "enabling [industry] to afford and engage in high risk

research," "stimulating collaboration and formation of strategic alliances," "shortening the R&D cycle,"

"helping attract additional funding," and "creating new business opportunities," among the many other

effects reported by those earlier studies. Results of the current study parallel results of Powell’s study

of ATP projects funded 1993-1995 (Powell, 1997) but with the current study showing increased

commercialization activity commensurate with the more advanced average level of ATP project

completion. (See Appendix B.) A more recent study by Powell based on BRS data focused on ATPfunded small firms. This study identified a number of factors that have contributed to the success of

small firms in winning ATP awards and found that small firms are keeping up with larger firms in

achieving major milestones toward commercialization at least through the period of funding of R&D and

that those in joint ventures appear to be making particularly rapid progress (Powell, 1999).

Summary of Findings

Opportunities for economic spillovers from the portfolio of projects in the BRS appear strong, and for

the most part consistent with the original basis for project selection. Project participants have identified

more than 1,200 applications of the technologies under development and reported on commercialization

plans for over 970 applications spanning the spectrum of SIC (or NAICS) industries. Most applications

involve new products with significant performance improvements over existing/defender technologies,

offering dramatic possibilities for productivity improvements. Many are "new-to-the-world-products"

aimed at brand new markets. Most companies seek to address stages of production relatively early in the

production chain, for example, materials processing or component manufacture, creating maximum

opportunity for intermediate producers/customers at multiple later stages, and even in multiple

application areas, to experience market spillovers. 

Opportunities for additional economic spillovers through technology diffusion are being enhanced by

patent and licensing activity and dissemination of non-proprietary information. ATP projects build on

more than 2,000 existing patents, and more than 90 percent of companies plan to patent or copyright their

ATP-funded technologies as a primary intellectual property strategy. More than two hundred patents

have been filed, and 23 patents have been issued. Licensing to others is a primary or secondary strategy

for commercializing 47 percent of the planned applications. Conference activity and publication of

papers has been very vigorous, with an average of 3.6 conference papers presented and 1.3 professional

journal articles published per project.
 47

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Consistent with ATP's mission to accelerate the creation and commercialization of advanced

technologies, acceleration of the R&D process and time-to-market reduction appear to be important

project goals, with acceleration of at least two years anticipated for 65 percent of applications. In many

cases the time saved may be critical to meeting the narrow window of opportunity in fast-paced, highly

competitive technology and product areas. Eighty-six percent of organizations indicate they are already

ahead in their R&D cycle as a result of ATP funding; of these, 24 percent believe they would not have

started the project without ATP funding; 55 percent are one to three years ahead after just one or more

years of ATP funding.

ATP funding appears to have stimulated increases in private sector investment in high risk R&D. Some

projects would not have been undertaken at all with ATP funding, and others received a higher level of

private investment as a result of ATP funding. An estimated $320 million of company internal funds

have been invested in or committed to ATP projects beyond what industry alone would have invested in

the absence of the ATP awards, an estimated 58 percent increase in industry's investment in the ATPfunded technology areas. This increased industry investment is in addition to the ATP funding and the

funding industry would otherwise have invested. Approximately $200 million of new funding from

outside the awarded organizations has been attracted to support the ATP-funded technology development

and commercialization of current or future products. Most organizations further report that the ATP

award has changed the nature of their R&D program to encompass a broader scope, higher level of

technical risk, and/or longer-term R&D horizon.

The ATP appears to be meeting its legislated objectives of stimulating successful collaborations among

companies and among industry, universities, and research laboratories. Eighty-six percent of

organizations, from a mix of joint venture and single-company projects, report that their project has

involved collaboration with other organizations. Of these: 88 percent indicated that the ATP was

responsible to a moderate or great extent for the collaborations; 97 percent reported that stimulation of

creative thinking was significantly or moderately enabled by collaboration; 85 percent reported saving

time as a result of collaboration were significantly or moderately enabled by collaboration; and 80

percent or more reported that obtaining R&D expertise, accelerating entry into the marketplace, and/or

encouraging future collaborations were significantly or moderately enabled by collaboration. Of the

same group, 56 percent indicated that project coordination and management costs were significantly or

moderately affected by collaboration; however, only 18 percent reported delays in beginning the R&D,

and only 8 percent anticipated delays in product entry into the marketplace or other difficulties as a result

of collaboration costs.

Companies report active engagement in the commercialization planning activities needed to enter the

marketplace in a timely manner, once the technology is ready. Companies in 84 percent of the projects

have completed product/process definition for at least one application; companies in 70 percent of the

projects have completed concept testing for at least one application. Although production has begun for

only 10 percent of applications being planned, 64 percent of projects have completed a production

prototype for at least one application, and 55 percent of projects have completed pilot production or a

commercial demonstration for at least one application. Alliances are being negotiated with strategic

partners for commercialization, with small companies particularly focused on this activity.

Progress towards achieving revenue goals is also reported. Most expect revenue one-to-three years after

the project ends, but for 19 percent of applications, revenue is expected from spin-off activities before

the end of ATP funding, and for nearly eight percent of applications and organizations, revenue is not

expected until four or more years after the ATP project ends. Fifty-four percent of the companies,

representing 66 percent of the projects, report they are now able to make a new or improved product, even
48

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

though the product may not be ready for the marketplace for some time. Thirty-nine percent of

companies, representing 51 percent of projects, report they have adopted process improvements resulting

from ATP funding. Seventeen percent of companies, representing 27 percent of projects, indicate they

had already earned some early product revenues, amounting to more than $67 million by March 1998,

from sales of samples and prototypes and early "spin-off" products. Some companies have also realized

their first licensing revenues. The nature and timing of the first revenues appear consistent with the R&D

status of these projects and projected timeline for revenues (see Figure 14).

Plans for Future Work

The ATP plans to continue the BRS data collection for future projects and participants funded by the

program. In addition to providing a large volume of data covering more projects for a longer time period,

the BRS will continue to provide an evolving picture, with statistical summary metrics, of the status of

ATP projects towards meeting ATP's legislated economic objectives. 

A new study underway extends the analysis of BRS data through September 30, 1999. This study covers

300 ATP projects funded through FY98, and includes reports from nearly 600 project participants

reporting on more than 1,500 commercial applications of ATP-funded technologies.

Besides routine data collection and maintenance, work is anticipated in a number of areas:

 Extension of the BRS -- Extension of this database is focusing on development of questions for postproject reports required every two years for six years following the end of the ATP award. These

questions will update commercialization activity and probe in more detail for evidence of intraindustry and inter-industry diffusion of ATP-funded technologies and of benefits to users, for

example, health and safety impacts, as well as longer-term economic impacts on the companies

funded. This information will be invaluable in studies of economic spillovers. Data collection is

now underway for organizations funded in FY93 and FY94.

 Revision of the BRS -- A major revision of the BRS routine reporting questions is also underway.

The major purpose of the revision is to develop a more user friendly web-based reporting format.

In the course of that revision process, some content changes are being made, drawing on our

experience in using the BRS to date and on feedback from other economists, as well as from ATPfunded organizations reporting to us.

 Additional, detailed studies using the BRS -- The BRS supports detailed analysis of many aspects

of ATP’s project portfolio. For example, projects can be sorted by type, industry sector, technology,

geographical location, and other attributes. The BRS database is part of the broader ATP relational

database structure and can further be linked to external, establishment-level national data sources

by 4-digit SIC code. Under appropriate restrictions to maintain confidentiality of company

information, the data are used by economic researchers in studies of ATP project and program

progress and impact. The BRS data can also be used in conjunction with information from diverse

sources to support a variety of evaluation studies, including detailed case studies. 
 49

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

REFERENCES

Jaffe, A.B. (1996). Economic Analysis of Research Spillovers: Implications for the Advanced

Technology Program. Gaithersburg, MD: National Institute of Standards and Technology.

Leifer, R. (1997). Managing Discontinuous Innovation in Established Firms: Reducing Uncertainty and

Resistance. (forthcoming)

Laidlaw, F. (1997). Acceleration of Technology Development by the Advanced Technology Program:

The Experience of 28 Projects Funded in 1991. Gaithersburg, MD: National Institute of Standards and

Technology.

Mansfield, E. (1996). Estimating Social and Private Returns from Innovations Based on the Advanced

Technology Program: Problems and Opportunities. Gaithersburg, MD: National Institute of Standards

and Technology. 

Mansfield, E., Rapoport, J., Wagner, S. and Beardsley, G. (1977). "Social and Private Rates of Return

from Industrial Innovations." Quarterly Journal of Economics.

Powell, J. (1997). Development, Commercialization, and Diffusion of Enabling Technologies: Progress

Report for Projects Funded 1993-1995. Gaithersburg, MD: National Institute of Standards and

Technology.

Powell, J. (1999). Business Planning and Progress of Small Firms Engaged in Technology Development

Through the Advanced Technology Program. Gaithersburg, MD: National Institute of Standards and

Technology.

Regalado, A. (1996). "The DNA-Chip in Diagnostics." Start-Up. September 1996.

 

Ruegg, R. (1997). "ATP's Evaluation Plan and Progress." Paper presented at the 7th International Forum

on Technology Management, and published in Conference Proceedings November 1997.

Ruegg, R. (1996). Guidelines for Economic Evaluation of the Advanced Technology Program.

Gaithersburg, MD: National Institute of Standards and Technology. 

Sedlak, B. (1996). "GeneTrace Systems Bets its Future in Genomics on TOF Mass Spectroscopy."

Genetic Engineering News. December 1996.

Service, Robert F. (1998) “Microchip Arrays Put DNA on the Spot,” Science, Vol. 282, Number 5388,

October 1998.

Silber & Associates (1996). Survey of Advanced Technology Program 1990-1992 Awardees: Company

Opinion About the ATP and Its Early Effects. Gaithersburg, MD: National Institute of Standards and

Technology.

Solomon Associates (1993). The Advanced Technology Program - An Assessment of Short-Term Impacts:

First Competition Participants. Gaithersburg, MD: National Institute of Standards and Technology.
50

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

von Hippel, E. (1994). "Sticky Information and the Locus of Problem Solving: Implications for

Innovation," Management Science 40, no. 4 (April).
 51

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded INFORMATION/COMPUTER SYSTEMS

technologies support applications in numerous industry sectors

Business

Services

(SIC 73)

52%

INFORMATION

TECHNOLOGY/

COMPUTER

SYSTEMS

32%

Note: "Other" SIC categories are defined in Appendix A.7

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Other

(SIC 87, 50, 10, 38,

82,41, . . . )

19%

Health

Services

(SIC 80)

10%

Industrial

Machinery

& Equipment

(SIC 35)

10%

Electronic & Other

Electric Equipment

(SIC 36)

9%

Appendix A.1 Planned Diverse Applications of ATP-funded Technologies–

Information Systems

APPENDICES

Appendix A. Planned Diverse Applications of ATP-funded Technologies
52

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded MANUFACTURING (DISCRETE) technologies

support applications in numerous industry sectors

Other

(SIC 34, 30, 13, 33,

73, 87, 01, . . . )

25%

MANUFACTURING

(DISCRETE)

21%

Note: "Other" SIC categories are defined in Appendix A.7. 

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Industrial Machinery

& Equipment

(SIC 35)

29%

Transportation

Equipment

(SIC 37)

24%

Instruments &

Related Products

(SIC 38)

16%

Leather &

Leather Products

(SIC 31)

6%

Appendix A.2 Planned Diverse Applications of ATP-funded Technologies--

Manufacturing (Discrete)
 53

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded BIOTECHNOLOGY technologies

support applications in numerous industry sectors

Other

(SIC 02, 51, 89)

12%

BIOTECHNOLOGY

13%

Note: "Other" SIC categories are defined in Appendix A.7. 

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Chemicals &

Allied Products

(SIC 28)

48%

Instruments &

Related Products

(SIC 38)

22%

Health Services

(SIC 80)

11%

Engineering &

Management Services

(SIC 87)

7%

Appendix A.3 Planned Diverse Applications of ATP-funded Technologies--

Biotechnology
54

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded ELECTRONICS technologies

support applications in numerous industry sectors

Other

(SIC 80, 13, 31,

27, 33, 51, 73, 95)

16%

ELECTRONICS

10%

Note: "Other" SIC categories are defined in Appendix A.7. 

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Electronic & Other

Electric Equipment

(SIC 36)

38%

Instruments &

Related Products

(SIC 38)

33%

Industrial

Machinery & Equipment

(SIC 35)

8%

Transportation

Equipment

(SIC 37)

5%

Appendix A.4 Planned Diverse Applications of ATP-funded Technologies--

Electronics
 55

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded CHEMICALS & CHEMNICAL PROCESSING

technologies support applications in numerous industry sectors

Other

(SIC 22, 38, 73, 50,

36, 80, . . . )

18%

CHEMICALS &

CHEMICAL

PROCESSING

7%

Note: "Other" SIC categories are defined in Appendix A.7.

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Chemicals &

Allied Products

(SIC 28)

66%

Industrial Machinery

& Equipment

(SIC 35)

4% Petroleum &

Coal Products

(SIC 29)

8%

Rubber & Miscellaneous

Plastics Products

(SIC 30)

4%

Appendix A.5 Planned Diverse Applications of ATP-funded Technologies--

Chemicals & Chemical Processing
56

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Example: ATP-funded ENERGY & ENVIRONMENT technologies

support applications in numerous industry sectors

Other

(SIC 28, 50,

& 29)

9%

ENERGY &

ENVIRONMENT

4%

Note: "Other" SIC categories are defined in Appendix A.7. 

Source: Business Progress Reports for 974 applications being pursued by 463 companies in 256 ATP projects funded 1993-1997.

Industrial Machinery

& Equipment

(SIC 35)

50%

Electronic & Other

Electric Equipment

(SIC 36)

29%

Transportation

Equipment

(SIC 37)

6%

Oil & Gas Extraction

(SIC 13)

6%

Appendix A.6 Planned Diverse Applications of ATP-funded Technologies--Energy

and Environment
 57

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Appendix A.7: SIC Codes Included in “Other” Category

Applicable to Figure 4 and Appendices A.1 through A.6

01 Agricultural Production - Crops

02 Agricultural Production - Livestock

10 Metal Mining

13 Oil and Gas Extraction

16 Heavy Construction, Ex. Building

22 Textile and Mill Products

23 Apparel and Other Textile Products

27 Printing and Publishing

28 Chemicals and Allied Products

29 Petroleum and Coal Products

30 Rubber and Misc. Plastic Products

31 Leather and Leather Products

32 Stone, Clay, and Glass Products

33 Primary Metal Industries

34 Fabricated Metal Products

35 Industrial Machinery and Equipment

36 Electronic and Other Electric Equipment

37 Transportation Equipment

38 Instruments and Related Products

41 Local and Interurban Passenger Transit

42 Trucking and Warehousing

49 Electric, Gas, and Sanitary Services

50 Wholesale Trade - Durable Goods

51 Wholesale Trade - Nondurable Goods

73 Business Services

76 Miscellaneous Repair Services

78 Motion Pictures

80 Health Services

82 Educational Services

87 Engineering and Management Services

89 Services, Nec

92 Justice, Public Order, and Safety

94 Administration of Human Resources

95 Environmental Quality and Housing

97 National Security and International Affairs
58

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Organizations Reporting Progress After One or More Years of Funding

1996

285 Organizations

179 Projects

1998

424 Organizations

199 Projects

Single

Applicants

42%

Single

Applicants

30% Joint

Venture

Participants

58%

Joint

Venture

Participants

70%

Small

Businesses

39% Medium

Businesses

23%

Large

Businesses

30%

Large

Businesses

31%

Medium

Businesses

22%

Small

Businesses

36%

Non-profits &

Gov't Labs

4%

Non-profits &

Gov't Labs

6%

Universities

4%

Universities

5%

Notes: * Fewer than 500 employees.

 ** Fortune 500 or equivalent as of Fortune 500 listing published April 1997.

Sources: 1996: Business Progress Reports from 285 organizations in 179 projects funded 1993-1995 reporting progress after one or more years of ATP funding.

 1998: Business Progress Reports from 424 organizations in 199 projects funded 1993-1997 reporting progress after one or more years of ATP funding.

Appendix B.1 Distribution of Types of Participation and Types of Organizations

Appendix B. Comparison of ATP Progress at Two Points in Time

This ATP progress report for projects funded 1993-1997 parallels the ATP progress report Development,

Commercialization, and Diffusion of Enabling Technologies published in December 1997 for projects

funded 1993-1995. In combination, the two reports provide snapshots of progress towards

commercialization and diffusion of ATP-funded technologies at two points in time for a growing group

of ATP projects funded since 1993. Drawing upon the analyses performed for the two separate reports,

Appendix B compares progress at the two points in time: 1996 and 1998. The comparative results are

based on Anniversary and Close-out Business Reports; i.e., they reflect reports from project participants

which had received a year or more of project funding as of the time of data collection. None had yet

completed a Post-Project Report.

The number of projects for which comparable information was available increased by only 20 between

1996 and 1998; however, the number of reporting organizations increased by 139. This is because the

additional projects included in the later report were mostly large joint ventures. As a result, the

distribution of types of participation is more heavily weighted to joint venture participants in 1998 than

in 1996. The distribution of types of organizations changed relatively little, though there was a slightly

smaller percentage of small businesses (with <500 employees) and a slightly larger percentage of large

businesses (Fortune 500 or equivalent) in 1998 than in 1996. This is due to the fact the new joint venture

projects included in the 1998 data contained more large firms than was typical of the projects covered

in the 1996 data.
 59

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

60

80

100

1996 1998

Level of Progress:

In completing the ATP-funded project

In completing all R&D needed for

commercialization (i.e., to begin product

development/clinical trials, and full

commercialization)

Median 1996 = 35%

Median 1998 = 61%

Median 1996 = 23%

Median 1998 = 41%

40

45%

34% 31%

38%

32%

27% 29%

20

24%

18%

16%

19%

13%

22%

0

4% 3%

8%

6%

11%

4%

16%

<10%

10-24%

25-49%

50-74%

75-100%

<10%

10-24%

25-49%

50-74%

75-100%

Sources: 1996: Business Progress Reports for 285 organizations in 179 ATP projects funded 1993-1995

 reporting progress after one or more years of ATP funding.

 1998: Business Progress Reports for 413 organizations in 198 ATP projects funded 1993-1997

 reporting progress after one or more years of ATP funding.

1996 1998

Appendix B.2 R&D Status

In 1998, compared with 1996, the portfolio of projects funded since 1993 had progressed considerably

further towards completing their period of ATP funding; i.e., the projects as a whole had “aged”

considerably despite the addition of new projects. (This picture will change as data becomes available

for the large number of projects funded in 1997 and 1998.) In 1996, half the reporting organizations

indicated their ATP projects were at least 35 percent complete; while in 1998, half the reporting

organizations indicated their ATP projects were at least 61 percent complete. In 1998, 31 percent of

reporting organizations indicated their ATP projects were 75-100 percent complete, compared with only

6 percent in 1996. 

Although some project participants have engaged in early types of commercialization activity by the time

ATP funding ends, most face additional R&D. In 1998, half the reporting organizations indicated the

total R&D required was at least 41 percent complete; while in 1996, half the reporting organizations

indicated the total R&D required was at least 23 percent complete. In 1998, only 16 percent of reporting

organizations believed they had completed 75-100 percent of the R&D required for full

commercialization, compared with 31 percent of the same group which had achieved 75-100 percent

completion of their ATP project and compared with only 4 percent of the 1996 group that had achieved

this level of completion of all R&D needed. 
60

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Appendix B.3 Early Commercialization Activities–Strategic Alliances and Licensing

Agreements

Number of Projects Number of Companies

1996 1998 1996 1998

Negotiations/discussions held with potential

strategic partners

69 97 77 113

Alliances formed with suppliers 24 37 27 37

Alliances formed with customers 24 49 24 52

Alliances formed for joint production 16 34 17 37

Alliances formed with distributors 8 30 8 30

Total alliances formed 72* 150* 76* 156*

Negotiations/discussions held with potential

licensing partners

32 53 32 53

License agreements signed 15 42 15 42

Note: *Projects/companies reporting more than one type of alliance are included multiple times.

Sources: 1996: Business Progress Reports from 271 companies in 178 ATP projects funded 1993-1995 reporting progress after one or more

years of ATP funding.

1998: Business Progress Reports from 356 companies in 198 ATP projects funded 1993-1997 reporting progress after one or

more years of ATP funding.

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 61

Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

0 20 40 60 80 100

Completed prototype

Completed pilot

production/commercial

demonstration

Began Production

Adopted process 

improvements

Earned Revenues from

products/services

 1996: >$20 M reported

 1998: >$67 M reported

Earned licensing royalties

 1996: $445 K reported

 1998: $5 M reported

Percent of Companies -- For at least one application

1996 (268-276 Companies) 1998 (330-332 Companies)

27%

52%

24%

42%

14%

5%

28%

39%

10%

17%

1%

4%

Sources: 1996: Business Progress Reports from 268-276 companies in 176-181 projects funded 1993-1995 reporting progress

 to commercialization activities after one or more years of ATP funding.

 1998: Business Progress Reports from 330-332 companies in 191-192 projects funded 1993-1997 reporting progress

 to commercialization activities after one or more years of ATP funding.

Appendix B.4 Early Commercialization Activities-Commercial Production and

Sales


   

 
 	
 
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Development, Commercialization, and Diffusion of Enabling Technologies: Progress Report

Appendix B.5 Protection of Intellectual Property and Dissemination of Non-proprietary

Information

Total Average Per 

Organization

Average Per 

Project

1996 1998 1996 1998 1996 1998

Patents Filed 105 239 0.4 0.6 0.6 1.2

Papers in Professional

Journals

131 250 0.5 0.6 0.7 1.3

Papers Presented at

Conferences

372 706 1.3 1.7 2.1 3.6

Sources: 1996: Business Progress Reports from 262-285 organizations in 179 ATP projects funded 1993-1995 reporting progress after one

or more years of ATP funding.

1998: Business Progress Reports from 377-424 organizations in 199 ATP projects funded 1993-1997 reporting progress after one

or more years of ATP funding.

 

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