How to Refurbish the U.S. Tech Industry

A prescription for fixing the country's innovation machine


Obama already has plans to bolster tech, with pledges of universal broadband service and a permanent R&D tax credit. Government can also help with new incentives for long-term tech investments, funding more university research, and improving science education.


Many venture capitalists gravitated to what looked like the easy money of low-cost Web 2.0 startups in recent years. But that market is now faltering. It's an opportune time for VCs to take a fresh look at companies planning breakthrough technologies. New tax policies could help.


Rather than creating me-too companies that offer the latest twist on social networking, entrepreneurs can build technologies that deliver value to hard-hit businesses. One opportunity: applying Web 2.0 ideas to improve the performance of corporations and government.


Breakthroughs often come from startups, but it's important for established companies to invest in disruptive technologies, too. Apple did it by moving from computers into music. Established companies may be able to create new markets in energy, transportation, and infrastructure.

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