Slugfest in the Nanotech Trenches
If baseball fans think the war of words between the Boston Red Sox and the New York Yankees is getting testy, they should take a trip into the world of nanotechnology research, where the folks in lab coats are starting to make the ballplayers look downright chummy.
On Feb. 1, Hewlett-Packard (HPQ ) announced what sounded like a major breakthrough in a press release enthusiastically titled, "Eliminating the Need for Transistors." The release said HP had built a tiny, molecule-scale switch called a "crossbar latch" that could perform the so-called logic operations of a computer on an unprecedentedly small scale (see BW Online, 2/1/05, "HP Prints a New Chapter in Circuitry"). "We are reinventing the computer at the molecular scale," said Stan Williams, a senior HP fellow, in the release.
Competitors in the field weren't so impressed. "I frankly think it's less significant than they are making it out to be" says Mark Horowitz, a physicist who specializes in circuitry and computer chip architecture at Stanford University, just down the road from HP's Silicon Valley research labs. "They aren't saying any mistruths, but there are more hurdles that need to be overcome in order for this to have" an actual integrated circuit. Other scientists were less polite, one even going so far as to call HP's news "twaddle."
So who's right? It's hard to say. Williams is one of the most respected researchers in the emerging field of nanotechnology and has been an outspoken pragmatist about its potential (see "A Nanotech Pioneer's Sober Assessment"). He's clear-eyed about his own research, and he says the first simple computer memory products based on his work probably won't hit the market for five years.
He even jokes that he has been so outspoken about the need to turn down the nanotech hype that other researchers have stopped inviting him to nanotech business conferences. "Many of the hypsters were trying to make a quick buck one way or another," he says.
To many, such scrapping among a field's luminaries may seem just a bit, well, unseemly, if not more than a little entertaining. But the truth is, scientists are a lot more competitive than you think, and the crossing of research swords is really nothing new. From electronics in the '50s to the dot-coms of the '90s, every new technology has its "irrational exuberance" stage -- complete with buzzwords, pie-in-the-sky predictions, testy exchanges among researchers, and a dozen false starts for every major breakthrough.
No doubt, that's where nanotechnology research is right now. Scientists are learning how to unlock extraordinary capabilities in commonplace materials by manipulating them on a molecular -- sometimes atomic -- scale. Nanotech has the potential to create everything from faster and smaller computer chips, to smart medicines, to straight-flying golf balls, and even car windshields that repel water without wipers (see BW Cover Story, 2/14/05, "The Business of Nanotech").
But in a field with literally thousands of possible applications, a huge gap often exists between what's theoretically possible in a lab and what can be reliably produced for commercial use. For nano-entrepreneurs and scientists, that gap makes the field especially tantalizing. And it makes it all the more frustrating when a competitor's press release claims he has jumped that gap with ease.
So how can you tell who's the real deal? The term "nano," for the most part, means little more than a size in the range of 1 to 100 nanometers. The width of a human hair, for example, is about 80,000 nanometers. The technology side of the equation comes into play with research into the surprising behavior of various materials when manipulated on that tiny level.
AN EMERGING SCIENCE.
That research encompasses thousands of niche applications in physics, chemistry, and biology. So far, simple applications of nanotechnology, like using ultrafine particles to strengthen composite materials, are already available. More sophisticated uses are on the way. But materials with the most incredible theoretical applications, such as integrated circuits built with superstrong, superconductive carbon nanotubes, may prove impractical to develop commercially, or fail on their way to market.
Match high expectations in a wide-open field that's more of an emerging science than an emerging industry and you have a recipe for sniping. With few companies offering products yet and even fewer seeing significant sales, most nanotech players are in a mad rush to win a piece of the estimated $5 billion in research funding earmarked by the U.S. government for universities and labs everywhere from California to Albany, N.Y.
Meanwhile, investors, venture capitalists, and large corporations are all still suffering from a tech-boom hangover. "Nobody is raising venture capital today who doesn't have a deep and abiding memory of that boom" says Matthew Nordan, an analyst at Lux Research, a nanotechnology research firm (see "High IPO Hurdles for Nanotechs"). As a result, they're much more cautious about funding this time around, Nordan says.
"PATENT LAND GRAB."
Nanotech startups, academic institutions, and corporate labs must fight like mad to show they're the true pioneers -- and worth the investment. The result: The nanotech business climate is like an old-time gold rush, only with a lot less land to grab.
"People are staking out intellectual-property territory," says Kelly Kordzik, a patent lawyer with Dallas-based firm Winstead, Sechrest & Minick, and head of the Texas Nanotechnology Initiative, a consortium of nanotech companies and research labs in the Lone Star State. "It's a patent land grab, and a technology land grab." Each company hopes one or two of the several hundred nanotech patents they apply for will strike pay dirt down the road, while showing venture capitalists and government officials that they're the technology leaders.
The tension is apparent in niches as specific as nano-powered tennis rackets. French company Babolat claims its NCT racket (for Nano Carbon Technology) is twice as stiff as a normal racket because it incorporates carbon nanotubes into the structure, while American racket-maker Wilson says its own nCode racket is stronger because it uses nano-size silicon dioxide crystals, which is something akin to finely ground sand.
"I don't want to rag on them, but I can't imagine [Babolat] adds any significant amount of nanotubes to make [their racket] play any better," says Brian Severa, global director of technology at Wilson's racket-sports division. "The tubes probably just stick together -- the benefit probably isn't even there."
Babolat's retort? "Babolat is the first company to develop and distribute a nanotech tennis racquet [and] the qualities conferred by the inclusion of nanotechnology are quite evident" a company representative wrote in an e-mail.
In such a hypercompetitive environment, using public relations to promote your accomplishments -- while accusing others of hyping their stuff -- seems to be the strategy of choice for "fencing in" an area of nanotechnology, says Bob Crowley, the founder of AMBIT Corp., which looks for applications that can take advantage of a nano-material called multi-walled carbon nanotubes.
The tubes, which look like rolled-up cylinders of graphite, have shown a range of exciting capabilities, from high conductivity to enormous durability. "The patent landscape is so complex that only the lawyers and a few inventors have a good grasp" Crowley wrote in an e-mail. Announcements like HP's in February are meant to establish them as a leader in people's minds early on, says Crowley.
A "media alert" sent out on Feb. 16 by Carbon Nanotechnologies, a maker of single-wall nanotubes, a slightly different variety from Crowley's, is a good example of the action/reaction nature of nano-research. The announcement was simply that the company had registered its 30th patent in nanotube production.
But competitors sniffed gamesmanship. Showing it has a strong hand on nanotube patents "has been [Carbon Nanotechnologies'] strategy," says Daniel Resasco, founder of Southwest Nanotechnologies, a competing manufacturer of single-walled nanotubes. "That's the game they're playing -- that anybody working with nanotubes has to work with them."
MYTH VS. REALITY.
Carbon Nanotechnologies is no slouch. It's one of the leading nanotube producers, and among its founders is Rice University Professor Richard Smalley, a Nobel prize winner. But competitors are unimpressed because they say the Texas company is just as reliant on a single IBM (IBM ) patent for the technology as anyone else. Carbon Nanotechnologies "seems to be doing media alerts every week," says Crowley. "But I suppose if I had the money that they have, I'd be scheduling some kind of events, too."
"We're pretty proud of our [intellectual-property] position -- there's no question about that" says Ken Smith, vice-president for technology at Carbon Nanotechnologies, which has raised more than $35 million in funding. "But we don't [make announcements] every week."
Tell that to the competition.
In a five-part special report, BusinessWeek Online will try to separate the myth-making from reality and the sniping from the justifiable critiques. It will look at health concerns created by research into the supertiny. It will explain nanotechnology's peculiar investment climate, talk with HP's Williams about his research, and explain why the most interesting nano-related companies aren't necessarily in the tech industry's traditional geographic hotbeds.
For a technology that makes materials behave in ways they've never done before, it makes sense that the industry itself is growing in a way no other industry has before.
By Burt Helm in New York