The economic development of nanotechnology

- An indicators based analysis

Author: Dr. Angela Hullmann European Commission, DG Research,

Unit “Nano S&T - Convergent Science and Technologies”

Version: 28 November 2006

This article can be downloaded from: http://cordis.europa.eu./nanotechnology

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The views expressed in this document are entirely those of the author and do not engage or commit the European Commission in any way.

More information on nanotechnology at the European Commission

is available on http://cordis.europa.eu/nanotechnology

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Introduction

It is my pleasure to present this third publication in a series of Commission staff working papers on nanotechnology research and development. After the two predecessors "Some figures about nanotechnology R&D in Europe and beyond", published in December 2005 and "Results of the informal collection of inputs for nanotechnology R&D in the field of (eco)toxicology", published in June 2006, this article analyses the economic development of nanotechnology. Nanotechnology has the ability to become the most promising technology advance for this century. It offers a huge potential of applications and economic benefits significantly contributing to the European economy. Enormous technological advances are being made in the worldwide race for progress. Europe’s starting position for this interdisciplinary and knowledge-based technology is promising. But much must be done in order to convert Europe’s scientific and technological excellence into economic returns in the form of new products, production processes and technology-intensive firms. As stated in the European Commission's Communication: "Nanosciences and nanotechnologies: An action plan for Europe 2005-2009" (COM(2005)243), the European Commission aims at providing favourable conditions for industrial innovation in nanotechnology to ensure that research and technological development is translated into affordable and safe wealth-generating products and processes. In order to do so, it is important to get a comprehensive picture of the state of the art of markets, companies, funding and S&T performance and prospective for development. The present analyses are based on indicators of the economic development of nanotechnology that can be publicly accessed. A focus has been put on the analysis of Europe compared to its main competitors. The data presented should not be deemed to be complete and in no way do they engage the European Commission. I thank my colleague Angela Hullmann for collecting the information from the various sources and for linking everything together in a comprehensive analysis. We hope that you find this to be useful information and would welcome any comments and suggestions on the indicators and analyses presented. More information on nanotechnology in Europe and in particular at the European Commission is available on http://cordis.europa.eu/nanotechnology and on http://www.nanoforum.org, amongst others.

Renzo Tomellini Head of the Unit

Nano S&T - Convergent Science and Technologies renzo.tomellini@ec.europa.eu

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The economic development of nanotechnology - An indicators based analysis

Table of content Page: 1. Introduction 7 2. Commercialisation of nanotechnology:

prospects of market volumes and shares 8 3. The global nano race: some data on public and private funding 13 4. Risk capital for high-tech research:

venture capital funding of nanotechnology 15 5. Analysing the economic impact: jobs and companies in nanotechnology 16 6. The technological development of nanotechnology: patent applications 21 7. The scientific basis of nanotechnology:

scientific publications and citations 26 8. Conclusions 29 List of tables and figures Page: Figure 1: World market forecasts for nanotechnology in billion US Dollar 9 Figure 2: World market 1999-2003 and forecasts for 2015 in US $ billion 10 Figure 3: World market forecasts in different nanotechnology segments 10 Figure 4: Volume and world market share of the nano-enabled drug delivery

market 12 Figure 5: Global sales of products incorporating emerging nanotechnology

by region - forecast in percent 13 Table 1: Estimated worldwide public funding, in 1000€, for nanotechnology

R&D in 2004 by individual countries 14

Figure 6: Estimated public and private funding for nanotechnology R&D

in 2004 by world regions in million € 15 Figure 7: Venture Capital funding worldwide by application and by year,

in million US$ 15

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Figure 8: Venture Capital funding worldwide in nano, in absolute numbers and as share 16

Figure 9: Number of nanotechnology jobs in million and the share of

nanotechnology jobs of all manufacturing jobs in percent 17 Figure 10: Nanotech Companies worldwide: decades and years (1981-2005)

of creation 18 Figure 11: Companies worldwide in different nanotechnology segments and

in most active countries 19 Figure 12: Nanotechnology companies in leading countries and by company

size (turnover in US$ million) in most active countries 19 Figure 13: Nanotechnological institutions by country and by type of

organisation 20 Figure 14: European institutions (university and other research institutes,

companies) active in nanotechnology 21 Figure 15: Nanotech patents worldwide according to EPO tag Y01N. Line

graph: Total number of patent families in Y01N 22 Figure 16: Average annual growth rates (%) per nanotechnology subfield for

two periods: 1995-1999, 1999-2003 23 Figure 17: Patents worldwide according to applicant and inventor countries 23 Table 2: Top 10 patenting countries worldwide in each nanotech field, 2003 24 Figure 18: Nanotech patents in top 8 applicant countries 25 Figure 19: Average annual growth rates of nanotech patents for in 2003 top 8

countries according to EPO tag Y01N 25 Figure 20: Scientific publications in nanotechnology in SCI database per world

region, 1992-1995 and 1998-2001 26 Figure 21: Scientific publications in nanoscience per country and subfield,

1999-2004 27 Table 3: Number of nanotechnology publications and citations in the SCI

database 1991-2000 for top 25 cited countries, ranked by average cites per paper 28

Table A1: World market forecasts for different nanotechnology subareas and

applications in US$ million 34

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Note from the author: Empirical analyses of nanotechnology have to suffer from the limited access to reliable and comparable data and its complex nature. Official statistics do not identify nanotechnology at all, or link it to various different categories where it cannot be identified correctly, or the definition is at least questionable. Against this background, the initiative of the European Patent Office of identifying and labelling (‘tagging’) nanotechnology patents must be highly acknowledged. In other cases such as the market prospects and the company data, large scale surveys specifically dedicated to nanotechnology and have been carried out. These provide valuable information, but lack of comparability with data retrieved from other surveys. In this article, the weakness of the empirical base of economic and S&T data of nanotechnology has been taken into consideration by collecting data from different sources and pre-selecting them on the basis of reliability of the source, plausibility of the methodology and consistency with other data. It has been attempted to draw a most complete picture with the data available and to draw conclusions on their basis. It was not possible and not the intention of the author to generate data herself.

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The economic development of nanotechnology - An indicators based analysis

When Nikolai Kondratieff published his theory of long waves in 1926, the third wave induced by the electricity and chemistry industries was already on a decline. Eighty years or two waves later (automobile and electronics, information and communication technologies), nanotechnology is a promising candidate for initiating a sixth Kondratieff wave, possibly in combination with biotechnology. Nanotechnology qualifies for having a major impact on the world economy, because nanotechnological applications will be used in virtually all sectors. Scientists, researchers, managers, investors and policy makers worldwide acknowledge this huge potential and have started the nano-race. The purpose of this paper is to analyse the state of the art of nanotechnology from an economic perspective, by presenting data on markets, funding, companies, patents and publications. It will also raise the question of how much of the nano-hype is founded by economic data and how much is based on wishful thinking. It focuses on a comparison between the world regions, thereby concentrating on Europe and the European Union in relation to their main competitors - the United States and Japan and the emerging ‘nano-powers’ China, India and Russia. 1. Introduction Nanotechnology can be everywhere. It is in car tyres, in tooth paste, in sun cream, in tennis rackets and tennis balls, in shirts and trousers, in CD players and even in surfaces of bath tubes, toilets and wash basins. With new properties such as smaller, lighter, faster, cheaper, water, dirt and stain resistance which enhance consumer goods. Are these products signs for the takeoff into the nanofuture, as many experts foretell? Are they first steps towards ‘nanorobots’ and ‘matter compilers’, towards a world with eternal life and inexhaustible resources? Nowadays’ nanotechnology is still at the frontier between scientific reality and ambitious visions, between first accomplishments and promising expectations, between incremental improvements and disruptive innovations. This range of opportunities can – explicitly or implicitly - be found in most assessments and analyses of ongoing and future developments of nanotechnology. It is applied by scientists as well as journalists, research managers as well as policy makers, investors as well as pressure groups. In many statements the one or the other extreme is emphasised, but points of reference are changed often and these changes are often taking place unconsciously. Many of these analyses used to have in common that they talk about nanotechnology as one single concept. Nowadays it is widely accepted that nanotechnology is a collection of different technologies and approaches, which

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all use the physical properties of dimensions on the nanometre scale, which differ from those observed in the micro and macro world. In order to draw a correct and comprehensive picture of the technology and to achieve a fair assessment of its status, potentials and drawbacks, it is necessary – where possible - to look at nanotechnology subareas such as nanomaterials and nanoelectronics, nanobiotechnology and nanomedicine, or nanotools, nanoinstruments and nanodevices. Nanomaterials are expected to have the major influence on virtually all fields where materials play a role. They include ultra-thin coatings and active surfaces as well as the new generation of chemical engineering. Nanoelectronics has a major impact on the information and communication technologies by continuing or overcoming (with the help of quantum electronics) Moore’s law of doubling data storage and processing capacities every 18 months. Nanobiotechnology will make the difference in medicine, for pharmaceuticals and diagnostics, in countless industrial processes, agriculture and food industry. Nanotools are nanotech enabling technologies, such as electron microscopes (Scanning Tunnel Microscope STM, Atomic Force Microscope AFM) and ultra-precision machines. In this article, the state of the art of nanotechnology will be analysed by presenting available data on nanotechnology markets and market projections, on jobs, on companies and other organisations active in nanotechnology, on public and private funding, including Venture Capital funding, on patents, and on scientific publications. The data have been collected from publicly available sources and will be cited accordingly. The author cannot take the full responsibility for their accuracy or trueness. Especially in the case of market data, which can only be estimates, the data differ very much depending on definition, source, methodology and purpose of collection and presentation. The author sought to overcome this problem by not relying on a single source and by comparing different sources before selecting them for further analyses. The purpose of the analyses is twofold: On the one hand, nanotechnology and its subareas will be analysed in order to present the state of the art, to identify most promising fields and to predict future developments. On the other hand, the analyses will shed a light on the contribution of nanotechnology to economic and social goals of the European Union such as competitiveness, economic growth and employment by focusing on Europe in comparison with its world competitors, mainly the United States, Japan and emerging nano-powers such as China, India and Russia. 2. Commercialisation of nanotechnology: prospects of market volumes and shares Because nanotechnology is expected to have a substantial impact on the world’s economy, market volumes are an appropriate indicator for its economic significance. On the other hand, nanotechnology does not correspond to an

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industry that can easily be identified and quantified. Nanotechnology will, if successful, contribute substantially but not in an easily quantifiable way to many product improvements and allow the production of completely new products. Most market forecasts for nanotechnology originate from the early 2000s, with a time horizon up to 2015. The maybe best known figure for the future nanotechnology market has been published by the National Science Foundation (NSF) of the United States in 2001. The NSF estimated a world market for nanotechnological products of 1 trillion US Dollars for 2015. Depending on the definition of nanotechnology and its contribution to added value of the final products as well as the degree of optimism, many other forecasts vary between moderate 150 billion in 2010 (Mitsubishi Institute, 2002) and 2.6 trillion in 2014 (Lux Research, 2004). The latter, most optimistic scenario would imply that the market for nanotechnology-based products would be larger than the prospected information and communication technology market and would exceed the future biotech market by ten times. Figure 1 shows some forecasts from different sources (see footnote). The forecasts differ significantly from each other, but have somehow in common that they predict a substantial increase of the market for nanotechnological products with a take off some when in the early 2010s.

Figure 1: World market forecasts for nanotechnology in billion US Dollar. Diverse sources1

The figures presented above show the possible direction, but are not adequate for deeper analyses of the development of the nanotechnology market. Lux Research and the NSF have both spent some efforts in breaking the figures down in nanotechnology subfields, the first in an analysis of 5 years in the past (1999-2003), the latter shows the expected breakdowns of the 1 trillion world market share in 2015 (Figure 2). 1 The forecasts originate from following sources: German Government, Evolution Capital, NSF

2001, Evolution Capital 2001, Sal. Oppenheim 2001, DG Bank 2001, DTI 2001, US Nanobusiness Alliance 2001, Cientifica 2002, In Realis 2002, Mitsubishi Research Institute 2002, Deutsche Bank 2003, Nomura Research Institute 2003, BCC 2004, GEMZ corp. 2004, Helmut Kaiser Consultancy 2004, Lux Research 2004.

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The figure shows that in the today’s market for nanotechnology products, nanodevices and nanobiotechnology are estimated to be responsible for the largest shares of around 420 and 415 million US Dollar. Materials and tools play a minor role with 145 and 50 million US Dollar. Compared to the forecasts for 2015, all areas are expected to undergo significant increases, e.g. for materials from 145 million up to 340 billion US Dollar. Nanoelectronics will amount to 300 billion US Dollars, followed by pharmaceuticals, chemical processing and aerospace. However, any comparisons of actual numbers and forecasts from different sources and with different breakdowns have to be interpreted carefully. The forecast exercise undertaken by Fecht et al. (2003) in their “Finding hidden pearls” report is more reliable because more focused on the near time horizon, i.e. 2002 to 2006 (Figure 3).

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Figure 3: World market forecasts in different nanotechnology segments, left: in billion US Dollar, right: average annual growth rate 2002-2006 in %. Source: Fecht et al., 2003

In these estimates, nanotools play the most prominent role on the world market, though with smallest growth rates. Nanodevices and nanomaterials start on a slightly lower level, but nanodevices increase with a much higher rate. Contrarily to the above observations of Lux Research, nanobiotechnology is only marginal, but increases substantially during the period of reference. Overall increases are at on average of 15 % annually, which does not yet reflect a real breakthrough. From these figures, it is obvious to conclude that nanotechnology is not yet on the take off point of revolutionising the world economy. So, which

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developments between 2006 and 2015 will lead to a one trillion market for nanotechnology? Many other studies have tried to prospect the nanotechnology market. Table A1 in the Annex compiles selected forecasts from different studies, without claiming to be exhaustive or methodological comparable, and including the above presented figures of NSF, Lux Research and Fecht et al. All data differ, depending on the study and the point of reference, even sometimes significantly for the same year. However, they give a comprehensive overview of market expectations and a first indication of which market segments can play a major role in the future. In this compilation of different nanotechnological subareas, applications and markets, nano enabled products are expected to be responsible for the largest share. The estimates for the whole area of nanoelectronics are around 300 billion for 2015, which covers semiconductors, ultra capacitors, nanostorage and nanosensors. The market for nanomaterials estimates can be broken down to some more or less important subareas, amongst which nanoparticles, nanocoatings and lateral nanostructures account for more than 300 billion Euro in all materials around 2010. These figures come very close to the NSF estimate for 340 billion US Dollar in 2015. The data - though fragmented and partially not comparable - lead to the assumption that nanomaterials will give a great contribution to future markets and applications. Compared to the data in Figure 3, one could conclude that the moderate increases up to 2006 will be topped by much stronger dynamics at some time between 2006 and 2010, depending on the material area. The three phases model of Lux Research (2004) shows the so far most comprehensive and sophisticated prospect of the developments in the nanotechnology market. The model includes a first phase up to 2004 with some nanotechnology incorporated in high-tech products. The next phase up to 2009 will bring breakthroughs for nanotechnology innovations. Nanoelectronics would dominate this market. In a third phase from 2010 onwards, nanotechnology will become commonplace in manufactured goods with healthcare and life science applications entering the pharmaceutical and medical devices markets. Nanobiotechnologies will contribute significantly to the developments in the pharmaceutical industry. Basic nanomaterials as such will loose importance at this time. Lux Research (2004) estimates a market share for nanotechnology products of 4 % of general manufactured products in 2014, with 100 % nanotech in PCs, 85% in consumer electronics, 23 % in pharmaceuticals and 21 % in automobiles. This would lead for nanotechnology to an overall share of 15 % of the global manufacturing output in 2014. In an analysis of the drug delivery market, estimates for nano-enabled drug delivery market support the above presented projections. Figure 4 shows the volume and share of the enabled drug delivery market compared to the worldwide drug delivery market.

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Figure 4: Volume and world market share of the nano-enabled drug delivery market. Source: Moradi, 2005

The expected development of the market for nano-enabled drug delivery shows an average annual increase of 50 % between 2005 and 2012. The increase of the market share follows a same path, but with slightly lower rates. In 2012, about 4.8 billion US Dollar will be earned with nanotechnology on the drug delivery market, which would be a market share of 5.2 %. If the development continues, this market share will increase to 7 % in 2015 and 10 % in 2020. None of the above presented projections include ranges of scenarios that are related to the public acceptance of nanotechnology, though lessons should be learnt from former emerging technologies such as nuclear power technology or Genetically Modified Organisms (GMO). Experience shows that citizens’ expectations and concerns as well as perceptions of risks and benefits have to be taken into account, since they present an important impact on the acceptance of new technologies on the market and can decide market success or failure. The ongoing debates on nanotechnology show that some controversies exist and that market success could be jeopardised if public opinion feels that it is not being addressed and consequently takes over a critical view about nanotechnology as such, due e.g. to health and environmental risks of nanoparticles or ethical concerns about privacy. When talking about economic potentials of nanotechnology, these debates have always to be addressed and must be taken seriously.2 These aspects can also have a substantial impact on the global distribution of sales and economic returns of nanotechnology products. While some world regions might be more inclined to accept the risks related to nanotechnology, even if they are not fully known or quantified yet, others can be more critical and more reluctant in their acceptance. The difference between the acceptance of

2 In the Communications “Towards a European Strategy for Nanotechnology” (2004) and “Nanosciences

and Nanotechnologies: An action plan for Europe for 2005 to 2009” (2005), the European Commission highlighted the importance of an integrated and responsible approach towards nanotechnology, by identifying not only scientific, technological and economic conditions as being important for the further development of nanotechnology, but also the societal dimension, risk assessment and an international dialogue. See on http://cordis.europa.eu/nanotechnology/actionplan.htm.

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genetically modified crops between the European and the American public illustrates this case adequately. Stricter regulations and less explicit marketing of the nanotech element in the products can be the consequence for the more critical regions. Independent of these aspects, Lux Research (2004) has broken down the figures of their forecasts (2.6 bn in 2014) by region (Figure 5).

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Figure 5: Global sales of products incorporating emerging nanotechnology by region - forecast

in percent. Source: Lux Research, 2004

Most interestingly, the most important region for the sales of nanotechnology products is Asia and the Pacific region, followed by the USA and Europe on similar levels. While Europe is predicted to have a small but continuous increase of its share, the US is decreasing until 2008 and increasing afterwards, Asia and the Pacific undergo the opposite development. The reasons Lux Research gives for these developments are related to the three phase model of the nanotechnological development: in the nearest future, products will dominate the world market that primarily originate from strong Asian companies, such as PCs, mobile devices or vehicles. After 2008, pharmaceuticals will become stronger and these are dominated by US companies. 3. The global nano race: some data on public and private funding The National Nanotechnology Initiative (NNI) in the United States, launched by the former president Clinton and entering into force in 2001, can be seen as the starting point of a global race for the world leading economies in nanotechnology research programmes. However, funding for nanoscience was already established in many regions of the world by this time, with Europe already being strong in nanomaterials by the mid- 1980s. Up to now, many other countries and the European Union have dedicated considerable amounts of money to nanotechnology research and development. Table 1 gives a snap shot of public funding activities in 2005.

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USA (Federal) 910,000 Australia 62,000 Finland 14,500 India 3,800

Japan 750,000 Belgium* 60,000 Austria 13,100 Malaysia 3,800 Eur. Commission 370,000 Italy* 60,000 Spain 12,500 Romania 3,100

USA (States) 333,300 Israel 46,000 Mexico 10,000 S. Africa 1,900 Germany 293,100 Netherlands 42,300 New Zeal. 9,200 Greece* 1,200

France 223,900 Canada 37,900 Denmark 8,600 Poland* 1,000 South Korea 173,300 Ireland 33,000 Singapore 8,400 Lithuania 1,000

United Kingdom 133,000 Switzerland 18,500 Norway 7,000 China 83,300 Indonesia 16,700 Brazil 5,800 others 2,800

Taiwan 75,900 Sweden 15,000 Thailand 4,200 total 3,850,000 Table 1: Estimated worldwide public funding, in 1000€, for nanotechnology R&D in 2004 by individual countries. * Data are from 2003. Source: European Commission, 2005

The European Commission is the largest funding organisation of nanotechnology research in Europe and as an individual agency even worldwide. In the 6th European Framework Programme for Research and Technological Development (FP6), nanotechnology has been defined, together with materials and production technologies (NMP), as a priority for European research. It is estimated that 1.3 billion Euro have been dedicated to nanotechnology projects between 2004 and 2006 (2004: 370 million Euro, 2005: 470 million Euro, 2006: 500 million Euro), also in other priorities than NMP such as the information society technologies, infrastructures, or research and training activities. Already within FP4 and FP5, from 1994 to 2002, nanotechnology related projects were funded which amounted to 300 million Euro in total. In the upcoming FP7 (2007-2013, for more information see http://cordis.europa.eu/fp7), nanotechnology will continue as a priority within the NMP theme and is expected to at least double the budget, with additional cross cutting activities related to the other FP7 themes (health, food, information & communication technologies, energy, socio-economic research and security) or programmes (infrastructures, SMEs, training, societal aspects). In addition, some emphasis will be put on nanoelectronics and nanomedicine as topics of European Technology Platforms and on safety, environmental and health aspects, nanometrology, converging technologies and international cooperation. Regarding the EU Member States, which are accounting together for a much larger share of European public expenditure in nanotechnology than the European Commission, Germany is the top spender, followed by France and the UK. Japan and South Korea are on a comparable level. In addition, taking into consideration that the figures are not reflected in purchase power parities, China's efforts must be considered as substantial and more than significant in a worldwide comparison. All countries are outdone by the United States, which is with the total expenditures of more than 1.2 billion Euros in 2004 and 1.7 billion Euros in 2005 by the federal government agencies and the federal states the largest public spending country worldwide. However, as a whole, and only taking into account the public funding of nanotechnology, Europe would be on a similar level as the United States (Figure 6).

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Adding the private funding figures, the picture looks different: In Europe, only one third of the total funding stem from private sources. In the United States, the private sources are around 54 % and in Japan they account for almost two thirds. For all other, mainly emerging Asian countries, the share is around 36 %. In absolute numbers, the US research community can spend more than 3.5 billion Euros for nanotechnology, while it is 2.7 billion in Japan and less than 2.5 billion in Europe. This shows the difference between Europe and its competitors in nanotechnological research: The public funding level is competitive, but European industry is lagging behind. 4. Risk capital for high-tech research: venture capital funding of nanotechnology Which technological areas are already especially dynamic and thus attractive for investors? A closer look at the risk capital market up to 2002 gives an indication.

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Figure 7: Venture Capital funding worldwide by application (left) and by year, in million US Dollar (right). Source: Paull et al., 2003.

Figure 7 shows nanobiotechnology as the most attractive market for Venture Capitalists, followed by nanodevices, while nanomaterials and nanotools play only a marginal role. Proportions have changed considerably; nanobiotechnology’s dominant role remains, but decreases. The overall Venture Capital (VC) funding increased from 63 million US Dollar in 1999 to more than 400 million in 2002, thus an increase of more than 500 % within 3 years. But

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here again, the decrease from 2000 to 2002, mainly in nanobiotechnology, shows that the VC market might still be in the wait-and-see mode. The continuation of the development of the VC world market for nanotechnology is presented in Figure 8.

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Figure 8: Venture Capital funding worldwide in nano, in absolute numbers and as share. Sources: 1999-2003: Anquetil (2005), 2004/2005: Lux Research, 2006, PriceWaterhouseCoopers 2006

The figures show a stagnation of the total VC funding development in 2002 and a moderate but steady increase afterwards. The share of nanotechnology in the world market of VC funding undergoes a similar development. This decrease can be explained by the fact that Venture Capitalists consolidated their views on nanotechnology, especially in regard to the risk debates related to possible dangers. The discussions became more vivid in the early 2000s when first results of toxicity analyses that have been published show a certain potential hazard related to nanoparticles. They are still going on and some investors might prefer to wait for more clear indications of the outcomes. On the other hand, some experts believe that a massive investment in nanotechnology could lead to products that society does not need (Nanologue, 2005). This lack of public involvement combined with huge investment and the hype surrounding nanotechnology would result in a “bubble” that could finally burst. In addition, the stagnation in 2002 and the decreasing growth afterwards might also be due to the fact that the market is already starting to get saturated. This is because demand for VC funding depends very much on the number of start up companies. Are there enough nanotechnological entrepreneurs who can absorb more than 500 million US Dollar annually or 2.2 percent of VC available world wide? 5. Analysing the economic impact: jobs and companies in nanotechnology The creation of companies is an important indicator for the development and economic significance of a new technology. New companies are typically start ups with one main asset: the patent on a new technology which they can exploit

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themselves or license to other companies which are more capable in terms of production or distribution. Venture Capital is a major source of financing in this high tech and thus high risk sector. When it comes to the creation of new jobs, start ups and small and medium-sized enterprises (SMEs) contribute most. The NSF estimates that about 2 million nanotechnology workers will be needed worldwide by 2015. They would be distributed across the world regions as follows: 0.8-0.9 million in the US, 0.5-0.6 million in Japan, 0.3-0.4 million in Europe, about 0.2 million in the Asia-Pacific region excluding Japan and 0.1 million in other regions. Additionally, 5 million related supporting jobs, or at average 2.5 jobs per nanotech worker, would be created (Roco, 2003). Even more optimistic, Lux Research expects a number of 10 million manufacturing jobs related to nanotechnology by 2014. Figure 9 shows the total number of jobs in nanotechnology and its share of all manufacturing jobs.

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Figure 9: Number of nanotechnology jobs in million and the share of nanotechnology jobs of all manufacturing jobs in percent. Source: Lux Research, 2004.

Many of these jobs will be created in SMEs, but not exclusively. In the past few years, many already well established companies expanded their technology portfolio to nanotechnology in order to maintain their competitiveness. This explains why companies were identified as being nanotech oriented that sometimes even existed 100 years ago or even longer. Typical examples are big companies in chemical and pharmaceutical industry, optics and electronics (Bayer, BASF, Carl Zeiss, Agfa-Gevaert, General Electrics, Philips, all created before 1900), though these established companies form a minority in the list of all existing nanotech companies. Figure 10 shows nanotechnology companies by their years and decades of creation, worldwide and by world region. The data stem from the publicly available database of nanotech companies provided by NanoInvestorNews. For 522 companies out of the total of 1000 companies in this database the year of creation was provided. The world regions are composed mainly by Germany, Switzerland and the United Kingdom for Europe, the United States and Canada for the Americas and Japan, South Korea and China for Asia.

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Figure 10: Nanotech Companies worldwide: decades and years (1981-2005) of creation. Note that some recently created companies (2001 or later) are not completely covered. Source: NanoInvestorNews database as of 8th May 2005 on www.nanoinvestornews.com.

Only a few of the today’s active nanotech companies had been created in the first eight decades of the 20th century, with an average of ten companies each decade. In the 1980s, the number increased significantly but the take off did not take place before 1996, in which about 30 nanotech companies were created – and up to 50 companies in 2000. This continues with increasing tendency, which is not reflected in the numbers due to incomplete data sets for the most recent years. It is important to note that all companies exist at the time of reference (May 2005), thus companies, which got bankrupt were acquired or got merged before, are not included in the statistics. Is there any difference between the world regions for number and year of the creation of nanotech companies? The numbers up to the 1990s should not be overrated, because of statistical distortions due to small numbers. However, they reflect the same proportions between the word regions in a constant way: The Americas are in the lead, followed by Europe and Asia. In the late 1990s, Europe reduced the gap to the Americas from half to two thirds. The point of take off is for both, the Americas and Europe, in 1996, with a peak at 2000 for Europe and 2001 for the Americas for the present. It has to be noted that these figures of the today's state of the art cannot reveal the solidity of the companies regarded. Analyses of differences in the founding culture have that US companies are often less resilient compared to European companies and get bankrupted faster. This phenomenon is not examined here for companies active in nanotechnology. In which nanotechnology segments are nanotech companies active? Figure 11 shows the result from a survey by Fecht et al., which covered 357 companies worldwide.

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Nano-materials

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Figure 11: Companies worldwide in different nanotechnology segments (left) and in most active countries (right). Data refer to a sample of 357 companies from a survey by Fecht et al., 2003

One third of the companies observed are active in nanomaterials, another third in nanobiotechnology. Nanotools and nanodevices play a smaller role. But there are significant differences between the four most active countries in the world: while the United States are pretty much average, Germany is stronger in nanotools, the United Kingdom in nanobiotechnology and Japan equally strong in nanomaterials and nanotools, above average in nanodevices and very weak in nanobiotechnology. Figure 12 shows the size of the companies in terms of turnover in most active countries.

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Figure 12: Nanotechnology companies in leading countries (left) and by company size (turnover in US$ million) in most active countries (right). Data refer to a sample of 357 companies from a survey by Fecht et al., 2003

The observed companies are mainly located the United States or Germany and to a lesser extent in the United Kingdom, Japan, Israel, Switzerland, Canada, and Sweden. (A similar ranking can also be observed in the dataset of NanoInvestorNews (see Figure 10, for which the figures are not given here.) The majority of the companies in the United States for which data are available are of medium size, i.e. 10 to 500 million US Dollar turnover. The majority of the German and the UK companies are much smaller with a turnover of below 10 million US Dollar, while the peak for Japanese companies can be found at 500 million US Dollar or higher. Private companies are not the only organisations active in nanotechnology. The number of all organisations that do research or produce nanotechnology reflects all nanotechnology R&D activities and helps to identify patterns of activity in

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terms of scientific and applied research. Figure 13 shows the number of organisations active in nanotechnology by institutional type, by most active countries and by world region.

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Figure 13: Nanotechnological institutions by country (left) and by type of organisation (right). The overall number is 1198 (left) and 1050 (right) respectively. Source: Cientifica, 2003

The dataset comprises around 1100 organisations, of which 460 are SMEs or start-ups, 390 research institutes, 120 large companies and 80 subsidiaries or joint ventures. But there are differences between the world regions: While SMEs and start ups have the by far largest share in the United States, universities and research centres play a bigger role in Europe and Asia. Grouped together in two groups - all companies (including SMEs, big companies and subsidiaries) on the one side and research institutes (universities and research centres) on the other side -, interesting differences between the countries can be observed. The share of research institutes of all organisations is very high in Japan, the United Kingdom, China, France, Australia and Sweden. In Austria, Spain, Italy and Poland, they even outnumber the companies. The proportion is different in the United States, Germany, Switzerland, Israel and Taiwan as well as in South Korea and Finland, where the number of companies doubles or more the research institutes. Another nanotechnology database focuses on European countries and shows the entries on www.nanoforum.org. Nanoforum is a European internet gateway for nanotechnology, financed by the European Commission. In August 2005, 1538 organisations were registered in this database, from 33 European countries. Though half of the entries stem from Germany, this database shows also the activity of smaller and less active countries in nanotechnology, as displayed in Figure 14. France and the United Kingdom are in the same level with together 250 entries, followed with a larger gap by the Netherlands, Austria, Switzerland and Belgium. Italy leads the midfield that includes Czech Republic, Denmark, Poland, Hungary, Sweden, Iceland, Israel, Lithuania, Slovakia and Slovenia. Compared to the country size, 19 entries from Iceland are as remarkable as the low number of 32 of Italy. Finland, Spain and Norway are in the groups with less then 10 entries, which is also against expectations for these countries.

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Figure 14: European institutions (university and other research institutes, companies) active in nanotechnology. The overall number is 1538. Note: Israel is associated to the Sixth European Framework Programme for Research and Technological Development (2002-2006) and thus included in these statistics. Source: NanoForum database as of 11.8.2005, on www.nanoforum.org.

From the data presented in this section, one can conclude that the most significant developments in the creation and activity of nanotech companies and nanotech related jobs can be observed in the United States. In Europe, Germany plays the most significant role, but on a rather moderate level when compared to the United States. Japan is the United States’ most important competitor. When it comes to competitiveness and job creation, the significance of companies being built on nanotechnological inventions or applying nanotechnology within their technological portfolio will increase. The emerging nanotech countries China, India and Russia are prepared to take-off and to approach Europe. Although none of them appear prominently in the company statistics, it can be assumed that they will show significant dynamics in the next decades and can become serious competitors on the world market for products and for research and production sites. First evidence gives the indicators for scientific and technological development, which are analysed in the following chapters. 6. The technological development of nanotechnology: patent applications Durable economic success would not be possible without a strong scientific and technological basis. On the other hand, scientific and technological excellence does not automatically facilitate economic success and breakthrough. The so called ‘European paradox’, which referred to Europe’s strength in science and its weakness in technological application and consequently economic success, did reflect these causalities. Is there a European paradox for nanotechnology also? For approaching the answer to this question, it is advisable to have a closer look at the two main quantifiable indicators of scientific and technological excellence: patents and publications.

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Patents reflect the ability of transferring scientific results into technological applications. Patents are also a prerequisite for economic exploitation of research results and are thus central for any analysis which deals with economic potentials of a technology and the identification of most promising fields and actors in terms of persons, organisations, or countries. The European Patent Office (EPO) has developed a methodology in order to identify and classify nanotechnology patents and patent families at most important patent offices worldwide.3 The initial purpose was to facilitate the work of the patent examiners and to identify developments in this emerging field in order to respond upfront to increased need of new patent examiners and interdisciplinary cooperation. The introduced ‘tagging’ method also serves researchers who are interested in patent analyses in the field of nanotechnology. It has the clear advantage that nanotech patents can be identified more adequately and that worldwide comparisons are more reliable because no world region is favoured.4 Figure 15 shows the evolution of the number of patent families from 1995 to 2003 and the shares in the different nanotechnology subfields.

Figure 15: Nanotech patents worldwide according to EPO tag Y01N. Line graph: Total number of patent families in Y01N. Pie: distribution of tag classes Y01N2-Y01N12 in 2003. Source: EPO, 2006 and own calculations.

The number of patent families increases continuously but with as yet no real take-off. Two small peaks in 1999 and in 2002 pointed to an exponential growth path, but in each case in the following year it had to suffer a slow-down which affects the overall growth rates in the period regarded. In 2003, the largest group of nanotechnology patents is related to nanoelectronics. Nanomaterials are on second place, followed with distance by nanomagnetics and nanooptics. Figure 16 shows the dynamics in each subfield. 3 For more information on rationales and methodology of the Y01N nano tag see Scheu et al,

2006. The tags are as follows: Y01N= Nanotechnology, Y01N2 = Nanobiotechnology, Y01N4 = Nanotechnology for information processing, storage and transmission (short: Nanoelectronics), Y01N6 = Nanotechnology for materials and surface science (short: Nanomaterials), Y01N8 = Nanotechnology for interacting, sensing or actuating (short: Nanodevices), Y01N10 = Nanooptics, Y01N12 = Nanomagnetics.

4 For a comparison of patent analyses by different authors, their methodologies and results, advantages and shortcomings, see Hullmann/Meyer, 2003.

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Figure 16: Average annual growth rates (%) per nanotechnology subfield for two periods: 1995-1999, 1999-2003. Source: EPO, 2006 and own calculations.

The overall growth rate of nanotechnology patents between 1995 and 2003 is at 14 % annually with lower rates in the second period compared to the first period. However, huge differences occur between the fields. Nanoelectronics, nanomaterials, nanodevices and nanomagnetics had the highest growth rates in the 1990ies but lower ones (to even negative growth in case of nanodevices) between 1999 and 2003. On the other hand, nanobiotech and nanooptics had to undergo negative growth in the late 1990ies, but increased to around 20% per year in the years 2000. However, in absolute terms both are on a much lower level than nanoelectronics and nanomaterials. Therefore, this increase can not be seen as an early indication of the growing significance of nanobiotechnology for the market of nanotechnology products. From which world regions do these nanotechnology patents stem? Figure 17 shows the number of nanotechnology patents worldwide, broken down to applicants and inventors from the Americas (mainly the US and Canada), Asia (mainly Japan and South Korea) and Europe (mainly Germany, the UK, France and the Netherlands).

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Figure 17: Patents worldwide according to applicant (left) and inventor countries (right). Source: EPO, 2006 and own calculations.

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It is obvious that America is the by far most active world region for registering patents in nanotechnology. For each year in question they count for half of the patents for which the country of applicant could be identified. Interestingly, this leading position is slightly weaker when it comes to the country of inventor, where Asia improves its position. The difference between country of applicant and country of inventor is - generally spoken - due to the difference between location of a company and living place of the researcher which occur in cases of research visits and of commuting between countries in border regions. In the case of nanotechnology, apparently and not further analysed here, a significant number of inventors registered Asian home addresses and worked for American applicant companies. Because of the huge number of cases, mobility of researchers might not be a sufficient explanation. It might be fair to assume that this difference is also due to the fact that their Asian research centre, owned by an American company, did not apply for the patent itself but left it to the American headquarter. Interestingly, the differences decrease in 2002 and 2003. This is an indication either for a change of habits in patenting or an increasing activity of Asian applicant companies. The American slope shows also that the peaks in world wide nanotechnology patenting (see Figure 15) has been caused mainly by an unusual large number of American applicants in 1999 and in 2002. The following table provides the top 10 countries for each N01Y subclass in 2003.

nanotechnology (y01n) nanobiotechnology (y01n2) nanoelectronics (y01n4) nanomaterials (y01n6)Appl. Country No. Inv. Country No. Appl. Country No. Inv. Country No. Appl. Country No. Inv. Country No. Appl. Country No. Inv. Country No.

USA 1136 USA 1177 USA 146 USA 188 USA 422 USA 413 USA 303 USA 345Japan 461 Japan 600 Germany 25 Germany 27 Japan 192 Japan 258 Japan 114 Japan 146

Germany 199 Germany 200 Japan 14 Japan 17 Germany 55 Germany 60 Germany 65 Germany 61UK 59 South Korea 73 France 11 Canada 12 Netherlands 28 South Korea 40 UK 21 UK 21

France 52 UK 68 Canada 10 UK 10 South Korea 24 Netherlands 19 France 17 South Korea 21South Korea 48 Canada 38 Italy 8 France 9 Canada 11 Switzerland 12 South Korea 15 Taiwan 15Netherlands 37 France 37 UK 6 Italy 9 France 10 UK 11 Belgium 8 France 14

Canada 32 Taiwan 29 India 6 India 6 UK 8 Sweden 10 Taiwan 8 Canada 9Italy 16 Netherlands 29 Israel 3 Israel 4 Sweden 6 Taiwan 10 Canada 6 Belgium 7

Taiwan 15 Switzerland 21 South Korea 2 South Korea 4 Taiwan 5 Canada 10 China 5 Singapore 7ranks 11-25:

Singapore 13 Israel 19 nanodevices (y01n8) nanooptics (y01n10) nanomagnetics (y01n12)Belgium 13 Sweden 19 Appl. Country No. Inv. Country No. Appl. Country No. Inv. Country No. Appl. Country No. Inv. Country No.

Switzerland 13 Italy 19 USA 103 USA 106 USA 171 USA 162 USA 214 USA 191China 13 Singapore 17 Japan 30 Japan 35 Japan 102 Japan 120 Japan 112 Japan 166

Sweden 12 Belgium 16 Germany 21 Germany 19 UK 26 UK 25 Germany 29 Germany 27Israel 12 Denmark 14 Switzerland 8 Switzerland 9 Germany 16 Germany 18 Netherlands 10 South Korea 7

Denmark 10 China 14 South Korea 7 South Korea 8 France 10 South Korea 9 France 6 Netherlands 5Australia 7 Australia 10 Singapore 4 Singapore 4 South Korea 6 Canada 8 South Korea 5 France 3

African IPO 7 African IPO 7 Sweden 4 Sweden 4 Canada 6 Denmark 7 China 2 China 2India 6 Finland 7 Israel 3 Israel 4 Israel 5 Italy 6 India 2 Finland 2

Finland 5 India 6 France 3 UK 3 Singapore 5 Singapore 6 Israel 1 Israel 2Spain 3 Russia 5 Netherlands 2 France 3 Denmark 5 Israel 5 Brasil 1 India 1Brasil 3 Spain 4 Spain 2 Netherlands 3 Singapore 1 Brasil 1

Austria 3 Cyprus 3 China 2 Singapore 1Russia 3 Brasil 3 Belgium 1Cyprus 2 Austria 3 Taiwan 1

Table 2: Top 10 patenting countries worldwide in each nanotech field, 2003, Note: numbers of patents are rounded, ranking refers to fragmented numbers. Source: EPO, 2006.

Table 2 shows that the United States are the most active patenting country in each subfield, both for applicants and for inventors. But the countries on the following ranks change their position depending on the field. Germany, France and Canada rank higher for nanobiotechnology, the Netherlands and Sweden come up in nanoelectronics, while Belgium and Taiwan rank high in nanomaterials. Switzerland is in particular strong in nanodevices, and the UK in

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nanooptics. Figure 18 shows the breakdown for the top 8 applicant countries in 2003, for two different periods.

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Figure 19: Average annual growth rates of nanotech patents for in 2003 top 8 countries according to EPO tag Y01N. Source: EPO, 2006 and own calculations.

The growth of the number of nanotechnology patents originating from the United States is very similar to the overall development of all nanotechnology patents, which is marked by larger increases in the late 1990s and smaller ones in the

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early 2000s. With 50 % of all nanotechnology patents it is quite natural that the development in the United States also shapes the worldwide development. The opposite picture can be observed for all other countries: small increases or even decreases (France, the Netherlands) in the 1990ies and significant growth in the years 2000. Germany, Canada, the UK and in particular the Netherlands and South Korea have shown a much more dynamic development in the last period regarded. 7. The scientific basis of nanotechnology: scientific publications and citations Scientific publications are the most appropriate indicator for measuring scientific excellence by quantifying the output. However, the pure output number could be misleading; other indicators such as citations do reflect the quality of a scientific paper and its impact on the scientific community. Comparing the world regions, Figure 20 shows Europe in the lead in the number of scientific publications in nanotechnology.

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Figure 20: Scientific publications in nanotechnology in SCI database per world region, 1992-1995 and 1998-2001. “Europe” includes EU Member States and Associated Countries. Source: Glänzel et al. 2003, http://www.steunpuntoos.be/nanotech_domain_study.pdf

In the 1990s, the European share still slightly increased, while the number of scientific publication originating from the USA and Canada decreased and especially ‘other Asia’, i.e. China, gained significance. Thus, it can be concluded that Europe has a large scientific basis in nanotechnology, comparable with its main competitors. ‘Other Asia’ is the most dynamic world region. A closer look at the different countries will shed some light at the origins of the nanoscientific publications. Figure 21 shows more recent data on the number of publications by country and by scientific disciplines.

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Figure 21: Scientific publications in nanoscience per country and subfield, 1999-2004 (SCI database). Sources: Igami, 2006, Science Citation Index 1999-2004. The analysis has been conducted by NISTEP, 2006.

Not surprisingly, the United States is most active with in total more than 18 000 nanoscientific publications from 1999 to 2004. Japan and China follow, but with a large difference. The largest European countries are in position four to seven. South Korea, Canada, and Spain complete the top ten. The picture change slightly when one distinguishes between the three nanoscientific subfields chemical synthesis, superconductivity and quantum computing, and nanomaterials. In the first two fields, Germany is much stronger than China, on a similar level with Japan, and the UK and France are on a similar level with China. China is very strong in nanomaterials, it takes over the second position from Japan and reduces the gap to the United States. Not all scientific publications have the same quality and being active does not necessarily create an impact. A good indicator for the quality of a paper and thus its relevance and impact is the number of citations it receives.5 Table 3 shows the quotes ‘cites per paper’ for each of the 25 top cited countries in the 1990ies.

5 More sophisticated analyses examine the number of citations relatively to the average number of

citations in the field and the journal regarded, but these complex analyses are not done here.

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Nationnumber of

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Switzerland 792 8233 10.40 Spain 874 5131 5.87Netherlands 514 4767 9.27 Israel 371 2063 5.56US 9993 92108 9.22 Brazil 245 1253 5.11Canada 754 5707 7.57 Austria 220 1103 5.01Belgium 382 2873 7.52 Italy 958 4585 4.79Ireland 131 926 7.07 Sweden 381 1729 4.54England+Scotland 1545 10325 6.68 Australia 349 1508 4.32EU-25 22069 145681 6.60 India 636 2005 3.15Denmark 217 1401 6.46 Poland 387 969 2.50France 2673 17168 6.42 Russia 1708 4240 2.48Japan 4251 26267 6.18 China 3168 7653 2.42Germany 3634 22373 6.16 Southkorea 579 1243 2.15

Table 3: Number of nanotechnology publications and citations in the SCI database 1991-2000 for top 25 cited countries, ranked by average cites per paper. Note that the EU-25 figures do only refer to the countries that appear in this table. Source: Thomson ISI database, 2001 on http://www.esi-topics.com/nano/nations/d1a.html

When it comes to the relative impact, two small countries are in the lead: Switzerland and the Netherlands. The top three are completed by the United States. The other most active countries United Kingdom (represented here by England and Scotland), France, Japan and Germany are only in the midfield, behind Canada, Belgium, Ireland and Denmark. The three most dynamic countries Russia, China and South Korea complete the picture. The list of top cited countries in nanotechnology does also reflect a general phenomenon: If a country is English speaking or does not have a strong language in terms of numbers of persons speaking it, or it is multilingual, it has a far greater tendency for publications in ‘world journals’ in English language, which do have a higher impact than national language oriented journals with a smaller potential readership and thus a smaller impact. The top cited journals for nanoscientific papers are the European ‘Nature’ and the US ‘Science’ (see Thomson ISI database, 2001, on http://www.esi-topics.com/nano/nations/d1a.html). Both journals are multidisciplinary, which is very appropriate for nanoscientific publications. The vast majority of the nanoscientific high impact journals are in the fields of chemistry and physics, some are on materials research. Out of the top list, only ‘Nanostructured Materials’ is explicitly dedicated to nanoscience - with a relatively low impact rate and at the same time second highest number of nanoscientific articles. These observations do support the interdisciplinary character of nanosciences: A nanoscientific article can be relevant for many disciplines and has thus the highest impact if the target community is broad – as it is the case for ‘Nature’ and ‘Science’ and the more general chemical and physical journals. Another, more general reason is that only high quality articles are accepted in these high level journals, which also leads to a larger number of cites. It can also be concluded that the nanoscientific performance of most of the European countries is ambiguous. European countries are either very active or with a high impact, while the United States, though very active, are also strong on the impact side.

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Compared with the patent data, two most important conclusions can be drawn. First, neither for publications nor for patents, Europe is homogenous. There is no evidence for a ‘European paradox’ but for a dispersed knowledge base and technological applications across Europe. Second, the United States is the benchmark when it comes to both scientific and technological excellence in nanotechnology. This conclusion is not new, but reinforced by evidence. 8. Conclusions The empirical analysis of the economic development of nanotechnology obviously starts with the market prospects. Those prospects which referred to nanotechnology as a whole vary a lot and are shaped by the purpose for which they are intended. This is also due to the problem that real facts are not easy to measure and almost impossible to prospect. However, the data presented are sufficiently reliable because they are consistent and some anticipate the different paces in different nanotechnology fields and different important nanotech countries. Following this line, we can indeed expect a bright nanotechnology future. Because of its cross cutting character and its particular significance for the pharmaceutical and electronics industry, it has the potential easily to overtake the traditional biotechnology and even reach the level of the current situation with information and communication technologies. These developments will have also a tremendous impact on the number of jobs in the manufacturing industries. Nanotech companies have been created in the past and much more are expected to emerge in the future. Unlike biotechnology, many of these companies will work in sectors where company size is less important for research and development (R&D), production or marketing. Once technologically successful, they will not necessarily be doomed to be acquired by a large company. This externalisation of high risk research, as observed as an R&D strategy in biotechnology for big pharmaceutical companies during the 1990s, will probably not occur to the same extent. Large and multinational companies are already committed to nanotechnology and spend a substantial amount of money for nanotech related research. In addition, risk capital for nanotech start up companies is available. Though not as optimistic as before the burst of the internet bubble, Venture Capitalists have discovered nanotechnology as the next big thing and follow with much attention and care the developments in the nanotech sector. Regarding the financing of nanotech research, some differences between the world regions become obvious. In Europe, the private investors are lagging behind the public funding agencies. While the United States and Japan have a more balanced partition of private and public funding, the European nanotech research has to suffer from lower private funding sources. On the other hand and in order to put it positively, the public funding of nanotechnology in Europe is competitive on a world level and shows the early reaction of European research policy to the new opportunities opened by nanotechnology and the

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participation at the "nano race". However, the lack of commitment of European private investors is not nano specific – the same can be observed for the overall R&D expenditures as well and therefore has to be put down to other, more general reasons in the European industrial research system. The problem is well known and falls within the "Barcelona 3% - and 2/3 from industry - objectives" tackled on the European level (European Council, 2002). The high level of public funding of nanotechnology research is very likely to have a positive impact on the S&T excellence of Europe. Knowledge and intellectual property are created in research projects which are to a great extent publicly funded. However, the successful technological implementation and the translation into commercially successful products depend also on the integration of industry in these projects, which is taking place but has to be improved. In this connection it can be considered as advantageous that Europe is focusing on civil applications of nanotechnology, other than e.g. the United States which spends a great share of its public funding of nanotechnology for military research. Another positive aspect of the substantial (civil) public funding in Europe is the societal dimension: Nanotechnology will have a positive impact on economic development – if it provides new solutions and does not create new problems. Only in this case will society in form of consumers, pressure groups and regulatory agencies accept and support nanotechnology products. The current discussions on the potential dangers of nanoparticles are addressed by contributing with research activities on the topic. Political action is also needed if risks turn out to be socially unacceptably high. The possibility to politically steer research, i.e. the definition of priority areas such as research on safety aspects of nanotechnology, on new environmental solutions, or on new medical devices, is one great advantage of publicly funded research. By influencing the direction of nanotechnology research, it can correspond to the societal expectations and consequently have a positive economic impact. The political lessons learnt from the data are not new: Europe is doing well, but has to reduce a gap to the United States and Japan in many fields and for many indicators. In addition, Europe has to observe carefully the development in the emerging nanotech countries China, India and Russia. Much will depend on Europe's scientific and technological excellence in order to strengthen the nanotech knowledge base in research and industry and not to ignore the parallel need for well educated nanotech workers and researchers and world wide competitive infrastructure for knowledge production.

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Bibliographic references: AllianzGroup report, Small sizes that matter: Opportunities and risks of

Nanotechnologies, Report in co-operation with the OECD International Futures Programme, 2005

Anquetil, P., The impact of nanotechnology, Susquehanna Financial Group, June 2005

Aspen Systems, Aspen Systems takes a giant step toward commercialization of Aerogels, Press Release, 2001

BASF 2002, cited by Diestler, D., Nanoteilchen in Megatonnen: Vielfältige Anwendungen für Polymerdispersionen, BASF-Press Release, Mannheim, 2002

Braun, A. E., Nanotechnology: genesis of semiconductors future, Semiconductor International, November, 2004 Bundesministerium für Bildung und Forschung (BMBF): Nanotechnology

conquers markets for nanotechnology, BMBF report, 2004 Bureau d'Etude Marketing du CEA Business Communication Company (BCC), Global Nanotechnology Market to

Reach $29 Billion by 2008, Press Release, February, 2004 Business Communication Company (BCC) 2002, cited by Rittner, M., Market

Analysis of Nanostructured Materials, American Ceramic Society Bulletin Vol. 81, No.3, 2002

Business Communication Company (BCC), Opportunities in nanostructured materials: Biomedical, pharmaceutical & cosmetic, Norwalk, USA, 2001

Chilcott, J., Jones, A., Mitchell, M., Nanotechnology: Commercial Opportunity, Evolution Capital Ltd., London, 2001

Cientifica The Nanotechnology Opportunity Report, edition 2002 Cientifica The Nanotechnology Opportunity Report, edition 2003 Cientifica Nanotechnologies for the Textiles Market, April 2006 Compañó R., Hullmann, A.: Forecasting the development of nanotechnology

with the help of science and technology indicators in: Nanotechnology, Volume 13, Number 3, pp. 243-247, 2002

Data Mine, Nanotechnology Grows Up, Data Mine Technology Review, June 2005

Department for Trade and Industry (DTI), 2001, cited by Greenpeace Environmental Trust, Future Technologies, Today’s Choices, 2003

Deutsche Bank AG, Nanotechnology Market and Company Report, 2003 DG Bank 2001, cited by DG/WZ Bank, Im Fokus. Nanotechnologie in der

Chemie. Frankfurt a. M., 2001 European Commission, Some Figures about Nanotechnology R&D in Europe

and Beyond, European Commission, Research DG, December 2005 European Commission: Nanosciences and Nanotechnologies: An action plan

for Europe for 2005 to 2009, Communication, 2005 European Commission: Towards a European Strategy for Nanotechnology,

Communication, 2004 European Council, Presidency Conclusions, Barcelona European Council, 15

and 16 March 2002

32/34

Evolution Capital Limited, Nanotechnology: Commercial Opportunity, London, 2001

Fecht, H.-J., Ilgner, J., Köhler, T., Mietke, S., Werner, M., Nanotechnology Market and Company Report – Finding HiddenPearls, WMtech Center of Excellence Micro and Nanomaterials, Ulm, 2003

Freedonia: Nanotech Tools to 2008: Nanotech Tool Technologies – Microscopy, on http://freedonia.ecnext.com/coms2/summary_0285-21108_ITM, August 2004 Frost&Sullivan 2002, cited by Carillo, D., Nanosensors' Niche in

Nanotechnology, in: Cepmagazin-online, 2002 Frost&Sullivan 2003, cited by Stevenson, R, OLEDs set to glow, e-zine

chemSoc, 2003 FTM consulting, Nanotechnology: Worldwide IC Market, November, 2004 Glänzel, W., Meyer, M., du Plessis, M., Thijs, B., Magerman, B., Schlemmer, B.,

Debackere, K, Veugelers, R.: Nanotechnology: Analysis of an Emerging Domain of Scientiifc and Technological Endeavour, Report of Steunpunt O&O Statistieken, K.U. Leuven, 2003

Greenpeace Environmental Trust, Future Technologies, Today’s Choices, 2003 Helmut Kaiser Consultancy, Nanotechnology in Food and Food Processing

Industry Worldwide, 2003-2006-2010-2015, Study, 2004 Hullmann, A., Meyer, M.: Publications and Patents in Nanotechnology: An

overview of previous studies and the state of the art, in: Scientometrics, Volume 58, Number 3, pp. 507-527, 2003

Igami, M., Bibliometric Indicators of Nanoscience Research, OECD working paper, presented at the NESTI working party, Berlin, 2006

Ikezawa, N., Competitiveness in High-Tech Fields and Nanotechnology, Nomura Research Institute, 2003

In Realis, A critical investor’s guide to nanotechnology, February, 2002 Lux Research, Rush to market in nanosensors, but most aren’t “nano”, May

2005 Lux Research, The Nanotech Report 2004, 2004 Lux Research, Sizing Nanotechnology's Value Chain, October 2004 McWilliams, A., Nanotechnology: A Realistic Market Evaluation, BCC Research

report, March 2004 Mitsubishi Research Institute 2002, cited by Kamei, S., Promoting Japanese-

style Nanotechnology Enterprises, 2002 Moradi, M.: Global Developments in Nano-Enabled Drug Delivery Markets, In:

Nanotechnology Law and Business, Volume 2.2, pp. 139-148., 2005 NanoForum database on www.nanoforum.org, 2005 NanoInvestorNews database on www.nanoinvestornews.com, 2005 NanoLogue Engaging with researchers and civil society Report from the

Nanologue project, www.nanologue.net, December 2005 NanoMarkets, Nanomemory: Commercial Opportunities for Nano-based

Memory and Storage Technologies, August 2004 NanoMarkets LC, Venture Development Associates, 2005 National Institute of Science and Technology (NISTEP), Development of New

Bibliometric Indicators Assessing Scientifc Activities, study in preparation, Tokyo, 2006

National Nanotechnology Coordination Office, 2005

33/34

National Science Foundation (NSF) 2001, cited by RedHerring, The Biotech Boom: the view from here, online article of 5th November, 2001

Paull, R., Wolfe, J., Hébert, P., Sinkula, M.: Investing in nanotechnology, in: Nature Biotechnology Vol 21, No. 10, p.1145, 2003

Reuters, Degussa investigations into alleged price-fixing in the carbon black industry, press release, 2002

Roco M. C., Converging science and technology at the nanoscale: opportunities for education and training, In: Nature Biotechnology Vol. 21, pp. 1247-1249, 2003

PriceWaterhouseCoopers, Venture Capital data, 2005 Sal. Oppenheim 2001, cited by Jankowski, P., Mikrosystemtechnik und

Nanotechnologie – Schlüsseltechnologien für Deutschland, Köln, 2001 Scheu?, M. Veefkind, V. Verbandt, Y. Molina Galan, E. Absalom R. and Förster

W., Mapping nanotechnology patents: The EPO approach, in: World Patent Information, 28, pp. 204-211, 2006

Small Times, Veeco came, saw, acquired majority of the AFM Market, www.smalltimes.com, 2002

SRI, Nanoscale chemicals and materials: An overview on technology, products and applications, in: SRI-International Report, Speciality Chemicals: Nanotechnology, 2002

Thomson ISI database, on http://www.esi-topics.com/nano/, 2001 US Nanobusiness Alliance 2001, cited by CMP Cientifica, Nanotech – The tiny

Revolution, Madrid, 2002 VentureCapital Magazin, Nano-/Mikrotechnologie, 2003 Verein der Ingenieure - Technologiezentrum (VDI-TZ) Nanotechnologie als

wirtschaftlicher Wachstumsmarkt, Company Survey, 2004 Verein der Ingenieure - Technologiezentrum (VDI-TZ) Innovationsschub aus

dem Nanokosmos, 1998

34/34

Annex I: Table A1

Table A1: World market forecasts for different nanotechnology subareas and applications in US$ million. Note that some figures are given in EUR. Diverse sources

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

nano

mat

eria

ls14

000

(6)

2180

0 (2

3)23

000

(7)

22 9

00 (2

3)70

00 (9

)

24 2

00 (2

3)25

900

(23)

28 8

00 (2

3)22

000

(6)

21 0

00 (9

)13

000

(14)

800

000

(4)

340

000

(5)

nano

mat

eria

ls a

nd m

olec

ular

arc

hite

ctur

es13

000

(22)

basi

c na

nom

ater

ials

(nan

otub

es, q

uant

um d

ots)

134

(4)

28

8 (4

)

1

304

(4)

2 78

4 (4

)5

947

(4)

12 8

92 (4

)na

nopa

rticl

es49

3 (9

)46

(4)

900

(9)

synt

heth

ic n

anop

artic

les

40 0

00 (2

1)m

etal

oxi

de/m

etal

nan

opar

ticle

493

(9)

900

(9)

nano

parti

cles

and

com

posi

tes

12 0

00 (1

2)62

000

(12)

carb

on b

lack

3000

(20)

5.7

(10)

carb

on n

anot

ubes

145

(11)

poly

mer

nan

ocom

posi

tes

320

(21)

300

(10)

1500

(17)

14

00 (2

1)po

lym

er d

ispe

rsio

ns15

000

(21)

nano

coa

tings

24 0

00 (1

2)40

000

(12)

81 0

00 (1

2)81

000

(12)

nano

surfa

ces

13 0

00 (2

2)

late

ral n

anos

truct

ures

1 60

0 (2

2)

13 0

00 (1

2)48

000

(12)

nano

mag

netic

mat

eria

ls a

nd d

evic

es4

300

(9)

12 0

00 (9

)m

icro

nise

d su

bsta

nces

(vita

min

es, p

harm

aceu

tical

s)1

000

(21)

aero

gels

10 0

00 (1

8)de

ndrim

ers

5-15

(10)

nano

biot

echn

olog

ies

3 30

0 (2

3)4

000

(23)

5 30

0 (2

3)6

200

(23)

7 60

0 (2

3)na

no e

nabl

ed d

rug

deliv

ery

260

(24)

421

(24)

731

(24)

1 14

6 (2

4)1

728

(24)

2 63

3 (2

4)3

578

(24)

4 81

4 (2

4)D

NA

Chi

ps10

00 (2

3)1

900

(23)

Prot

ein

Chi

ps10

0 (2

3)40

0 (2

3)C

oron

ary

Sten

ts2

100

(23)

5 30

0 (2

3)

nano

tool

s24

700

(23)

39 9

00 (2

3)18

0 (9

)

45

900

(23)

53 0

00 (2

3)10

0 (6

)

61

000

(23)

1 00

0 (6

)

1 20

0 (9

)22

000

(5)

nano

devi

ces

26 6

00 (2

3)28

600

(23)

30 8

00 (2

3)33

600

(23)

3 00

0 (6

)

37 3

00 (2

3)6

000

(6)

mea

sure

men

t and

ana

lysi

s of

nan

ostru

ctur

es2

000

(12)

9 00

0 (1

2)na

noan

alyt

ics

3000

(22)

se

mic

ondu

ctor

tool

s an

d in

stru

men

ts5

500

(13)

nano

tool

s, n

anod

evic

es, n

anob

iote

c73

000

(7)

nano

elec

troni

cs12

000

(15)

40 0

00 (1

5)76

000

(15)

300

000

(5)

nano

base

d se

mic

ondu

ctor

s30

0 00

0 (3

)50

0 00

0 (3

)or

gani

c se

mic

ondu

ctor

s50

0 (2

)na

no-b

ased

ultr

a ca

paci

tors

38 (2

)35

5 (2

)na

nost

orag

e18

000

(19)

65 7

00 (1

9)se

nsor

s9

(2)

340

(2)

nano

inte

rmed

iate

s85

1 (4

)7

888

(4)

37 8

90 (4

)16

0 75

0 (4

)44

2 02

0 (4

)74

1 86

4 (4

)

nano

ena

bled

pro

duct

s12

001

(4)

43 4

55 (4

)11

0 94

4 (4

)34

4 20

4 (4

)96

2 51

1 (4

)1

818

126

(4)

nano

ena

bled

pro

duct

s in

aut

o an

d ae

rosp

ace

8 50

0 (4

)au

tom

otiv

e1

110

(2)

6 50

0 (2

)ae

rosp

ace

70 0

00 (5

)sa

les

in fo

od a

nd b

ever

ages

sec

tor

150

(16)

860

(16)

24 0

00 (1

6)te

xtile

s13

600

(25)

115

000

(25)

phar

mac

eutic

als

100

(9)

140

(9)

180

000

(5)

chem

ical

pro

cess

ing

100

000

(5)

heal

thca

re30

000

(4)

30 0

00 (5

)su

stai

nabl

e pr

oces

ses

45 0

00 (5

)ul

tra p

reci

se s

urfa

ce p

roce

ssin

g3

000

(12)

20 0

00 (1

2)

(1) h

ttp://

freed

onia

.ecn

ext.c

om/c

oms2

/sum

mar

y_02

85-2

1108

_ITM

(7) D

euts

che

Bank

200

3(1

3) U

PI(1

9) N

anoM

arke

ts re

port

(25)

Cie

ntifi

ca, 2

006

(2) F

rost

&Sul

livan

200

2(8

) VD

I com

pany

sur

vey

(14)

III-V

s R

evie

w(2

0) R

eute

rs 2

002

(3) A

lexa

nder

E. B

raun

, cite

d by

Allia

nzG

roup

repo

rt(9

) BC

C 2

002

(15)

FTM

con

sulti

ng(2

1) B

ASF

2002

(dat

a ar

e in

EU

R)

(4) L

ux R

esea

rch

2004

(10)

SR

I 200

2(1

6) H

elm

ut K

aise

r Con

sulta

ncy,

200

4(2

2) V

DI-T

Z 19

98 (d

ata

are

in E

UR

)(5

) NSF

, 200

1(1

1) M

itsub

ishi

Res

earc

h In

stitu

te 2

002

(17)

Ste

vens

on, 2

003

(23)

Fec

ht e

t al.,

200

3(6

) dat

a m

ine

tech

nolo

gy re

view

(12)

DG

Ban

k, 2

002

(dat

a ar

e in

EU

R)

(18)

Asp

en s

yste

ms

(24)

Nan

oMar

kets

, Ven

ture

Dev

elop

men

t Ass

ocia

tes,

200

5