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Where Have You Gone, Bell Labs? 552

Posted by Soulskill
from the i'm-guessing-china dept.
theodp writes "Name an industry that can produce 1 million new, high-paying jobs over the next three years, challenges BusinessWeek. You can't, because there isn't one. And that's the problem. So what's the answer? Basic research can repair the broken US business model, argues BW, saying it's the key to new, high-quality job creation. Scientific research legends like Bell Labs, Sarnoff Corp, and Xerox PARC are essentially gone, or shadows of their former selves. And while IBM, Microsoft, and HP collectively spend $17B a year on R&D, only 3%-5% of that is for basic science. In a post-9/11 world, DARPA's mission has shifted from science to tactical projects with short-term military applications. Cutting back on investment in basic science research may make great sense in the short term, but as corporations and government make the same decision to free-ride off the investments of others, society suffers the 'tragedy of the commons,' wherein multiple actors operating in their self-interest do harm to the overall public good. We've reached that point, says BW, and we're just beginning to see the consequences. The cycle needs to be reversed, and it needs to be done quickly."
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Where Have You Gone, Bell Labs?

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  • by ZackSchil (560462) on Sunday August 30, 2009 @12:01PM (#29251951)
    They're looking for talented engineers and scientists with LOTS of imagination to take important projects from concept to reality!

    Check out their website and apply if you want to turn this trend around! [go.com]
    • Re: (Score:2, Funny)

      by Alomex (148003)

      Replying to undo accidental moderation.

    • Re: (Score:3, Insightful)

      by Anonymous Coward

      They're looking for talented engineers and scientists with LOTS of imagination to take important projects from concept to reality!

      Check out their website and apply if you want to turn this trend around!

      Having met many IT people who worked for Disney, I assure you that they are some of the brightest people around.

      You sometimes hear a remark like "it's a Mickey Mouse operation" intended to suggest that something is a crappy operation.

      Nothing could be further from the truth. Disney employs many many bright peo

    • by TrekkieGod (627867) on Sunday August 30, 2009 @02:46PM (#29253407) Homepage Journal

      They're looking for talented engineers and scientists with LOTS of imagination to take important projects from concept to reality! Check out their website and apply if you want to turn this trend around! [go.com]

      Back when I was doing my undergrad, Disney send some recruiters over to try to get people to sign up for summer internships. They sent fliers around that included that "free access to disney parks" crap and said they were giving a presentation to explain the details. I thought, "summer internship at disney. Could be kind of cool." I convinced my roommate to go with me to check it out.

      Well, I'll say one thing for them: they're not liars. I listened to their presentation while they gave everyone there every reason not to apply. The most important one being, "we don't really pay you enough to make any money. You probably can break even, but you'll most likely end up spending more money on rent and food than you'll get paid." Then they told us all how awesome it was because it was Disney! And you had free admission to theme parks and discounts on merch! And all you need to do to apply is fill up this form!

      My roommate and I both essentially said, "fuck that," but it was a lesson on the advantages of being a huge and famous company, especially one in the entertainment business. There were no lack of other people filling up those forms and disney gets some seriously cheap labor.

  • by Anonymous Coward on Sunday August 30, 2009 @12:05PM (#29251985)

    There is a really simple idea on how to get more basic research... PAY MORE!!!

    Seriously, in a world where artists, movie actors, athletes get completely outrageous salaries (let alone wall street and executives) the answer can be easily found.

    It used to be in the old days that you should learn a profession before becoming a professional athlete, actor, etc. Now the payoff of these fields far outweigh learning a "real" field. Look at MTV and this weird chick who thinks that she has talent. In fact want to see what the youth has become look at MTV reality in general...

    What do I do? I work in a hedge fund, even though I am a professional mechanical engineer who used to "build real things". I can actually build robots, and industrial production machinery. Because of my upbringing (German) it was ingrained to me to build "real things". I moved to finance because I am of the motto, "if you can't beat them, join them... Your life is too short..."

    • Re: (Score:3, Insightful)

      by Kral_Blbec (1201285)
      I agree. Its not the model that is broken, it is the society that isn't raising kids up to want to participate. Science and math are almost vulgarities it schools, its more fun to be in the drama team (official or unofficial).
      • Re: (Score:3, Funny)

        by Absolut187 (816431)

        On the plus side, some research is really popular:

        E.g., how far can a man hit a ball with a stick after injecting steroids into his blood stream?

        Or, how many deaths will a teenage girl cause if she is texting while driving?

        These basic research questions may soon be answered!

    • by spleen_blender (949762) on Sunday August 30, 2009 @12:42PM (#29252283)
      Most artists and actors (think local, like the guy who makes murals for cities or organizes local productions) aren't paid outrageous salaries. We only hear of the ones that do thanks to a for-profit news media.
    • Re: (Score:3, Insightful)

      by Anonymous Coward

      I am really tired of hearing whining about how exorbitant athletes' (et al.) salaries are. For crying out loud, it's not as though there's a government panel that decides how much they are paid and for what reasons. They're paid what they are for the simple reason that people pay a lot of money (or in the specific case of sports, a lot of people pay a small amount of money) to watch them do what they do. That's the value they're creating. You could certainly argue that basic research "deserves" more money,

      • by Grishnakh (216268) on Sunday August 30, 2009 @08:03PM (#29255699)

        I don't think anyone is saying that athletes should donate their money to science, or that the government should take it all, or whatever. However, the fact that athletes make SO much money shows how warped our society's values are. People don't want to spend 1 cent extra for something with long-term value (like scientific research), but they're perfectly happy to spend $2000 (no joke) on seats at a football game, or to waste their time and money watching a football game on pay-per-view TV. The huge demand for this brainless sports industry, and the consequential enormous amount of money flowing through it, is what allows them to pay athletes so much. So it's not like the athletes are taking it wrongfully; the individual citizens in our society are willingly forking it over. So again, this just shows that our citizens are idiots and don't spend their money wisely.

        But whining for more dollars to be funneled from rich folks' pockets into whatever project the government body in charge of spending their money thinks is worthwhile this week isn't the way to encourage it.

        No, that probably won't work either. Has the American government spent our tax dollars wisely in the past 10-20 years? I don't think so. Useless wars in foreign countries, a failed "war on drugs", a road to nowhere, bailouts of failed companies amounting to rewarding failure, and on and on. Meanwhile, they've cut NASA's budget over and over and over. Taking more money from American taxpayers (rich or not) isn't going to result in significant positive effects in science, because our government is so corrupt that the money will be wasted. It's like giving money to the Mexican government and expecting improvement; their government is so blatantly corrupt that it's impossible. Our government is just as corrupt, it's just not so obvious and no one wants to admit it.

        So what's the answer? I have no idea.

    • Re: (Score:3, Informative)

      by Kohath (38547)

      Highly-paid artists, actors, and athletes deliver a small value, but they deliver it to millions of people at once, and they can do it over and over. The total amount of value is huge. Hence their compensation is huge.

      I can remember people whining about performers' pay since the 1980s. It's been 25 years now and people like you still don't understand the way mass media multiplies value. Maybe you just don't care to understand it because you prefer whining. Who knows?

      I'm not going to address the rest of

    • by jellomizer (103300) on Sunday August 30, 2009 @06:30PM (#29255055)

      Umm. I don't think finding people to do R&D is the issue. It is funding the R&D that is an issue. How do you justify paying for R&D as an investment as what normally happends with R&D is you spend a lot of money for a new Idea. Now with that Idea the following can Happen...

      1. You Create a new product then in a few months 3rd party knock offs come up as they are cheaper start to chew away your market share. Your company image looks like a snotty over priced greedy company. Although the reason the competition is cheaper is that they didn't spend millions in R&D.

      2. You Create a new product but it is to far ahead of its time. Thus fails miserably. Being so far ahead of its time any minor glitch is magnified as the culture isn't ready to take such tradeoffs. You loose money from the product and your reputation is lowered as people who didn't like the tradeoff will assume you are out of touch with what they want.

      3. You Create a new Idea you didn't think it was worth while. Give/Sell it to an other company and they make huge amounts of money from it. And you just get mocked for not having enough foresight.

      4. You Create a new idea you don't think it is worth while but you hold on to the rights. Someone want to use it but you say now and you look like a patent troll.

      5. You put money in an Idea and it was not worth while but you try to market it. You loose money

      6. You put money in an idea and not worth while and do nothing. You still loose the money for the R&D.

      Oddly enough Monopolies or near monopolies really help large scale R&D while a world of open competition will prevent such large scale R&D and only allow for incremental changes. But to say you can't find people to do R&D i would say would be false. A lot of people would prefer to do R&D even if it paid less.

      • by Rhys (96510) on Sunday August 30, 2009 @11:52PM (#29256999) Homepage

        Basic science research != product R&D.

        If you don't understand the difference, you're probably part of the problem in why we aren't doing it.

        The transistor is probably the best example, but there's plenty of others. It didn't make AT&T the richest company or most powerful company on the planet, but it changed our world. And that change was mostly led by American companies, so even though AT&T didn't reap huge rewards (though they have done quite nicely for themselves up until the dot com bubble burst -- or should I say till they gutted Bell Labs which was pre-bubble) we as a society did.

        Basic science research leads to product R&D, but it does so way down the road. Corporate America (and the public at large, since the public at large is science-stupid) has lost the will to go there because of wall street and the public demand for "more profits now!" Does all basic science pay out? Heck no. Will it pay out in 10 years? Maybe. When it does pay out it can be huge. Figure the impact 50 to 60 years down the line by counting the household brands tied to the transistor: Microsoft and Dell come quickly to mind as huge companies built off that research. I'd put IBM, HP, Google, Yahoo and lots of others in the same boat, but nobody says huge and wouldn't exist without the transistor like MS and Dell.

        • by Znork (31774) on Monday August 31, 2009 @05:51AM (#29258577)

          When it does pay out it can be huge.

          What the BW article misses is that even a 'huge pay out' isn't going to translate into huge numbers of jobs. In fact, the whole purpose of most 'breakthroughs' is to reduce the amount of human labour needed to reach desirable goals.

          There aren't going to be any breakthroughs that create industrial jobs; robots and Chinese do that now. There aren't going to be any breakthroughs that create information work; computers do that now. Nanotech, biotech, AI tech, they're not going to create a demand for labour, they're going to reduce it.

          Of course, that may seem like a problem if one is stuck in the belief that 'jobs' are desirable in themselves. They're not, of course, jobs are what you don't want to do. The whole point of the free market economy is to reduce the amount of undesirable work needed to produce the desirable wealth; the ideal state and end-game of economy would be that no more work would need to be undertaken to obtain any particular expression of desire: the economy where all undesirable work is fully automated. The fact that jobs are disappearing means that we're approaching the goal; production capacity starts to outpace demand (in relation to the value of free time).

          The fact that we have an uneven distribution of the actual labour that does still need to be accomplished, now, that is a different thing. But the problem that some sit on their asses while others work too much isn't productively solved by trying to find pointless work for the ones sitting on their asses, but by biting the bullet and doing some basic science research in the field of economics and working out how to play out the end of the era of scarcity.

  • Surprising (Score:5, Insightful)

    by timeOday (582209) on Sunday August 30, 2009 @12:05PM (#29251989)
    Researchers have been sounding this alarm for years, if not decades. But what makes this significant is hearing it from the likes of BusinessWeek. If the Wall Street Journal ever catches on, we might be close to some real change. On the other hand, they are sure to think the solution to tragedy of commons is stronger IP laws rather than more investment in commons.
    • Re: (Score:3, Insightful)

      by samuX (623423)
      true. stronger ip laws will lead to even less R&D or to R&D which will involve 50% of the people there just to check if there hasn't been alread a previous IP on that idea . it is time to wipe out patent and copyright or rewrite it from the scratch to help evolve and not involve
      • Re: (Score:3, Insightful)

        by Absolut187 (816431)

        it is time to wipe out patent and copyright or rewrite it from the scratch to help evolve and not involve

        I don't suppose your proposal has any more detail to it?

        How would you incent R&D?

        Cash Prizes?

        stronger ip laws will lead to even less R&D or to R&D which will involve 50% of the people there just to check if there hasn't been alread a previous IP on that idea

        Actually, anyone doing research really doesn't have to worry about other people's patents.
        Since the beginning, patent law has recognized

    • Researchers have been sounding this alarm for years, if not decades. But what makes this significant is hearing it from the likes of BusinessWeek. If the Wall Street Journal ever catches on, we might be close to some real change.

      That's a good point. The Wall Street Journal's approach would probably be a bigger R&D tax credit.

    • On the other hand, they are sure to think the solution to tragedy of commons is stronger IP laws rather than more investment in commons.

      The problem with the "more investment in commons" argument is that even the U.S. government wants to protect the fruits of its research with patents (to prevent other countries from free-riding on us).

      In order for R&D to be worthwhile to any group of people, that group of people needs to see a return-on-investment. I know, I know. "Information wants to be free."
      But peo

    • Re:Surprising (Score:5, Insightful)

      by pitchpipe (708843) on Sunday August 30, 2009 @12:52PM (#29252369)

      If the Wall Street Journal ever catches on, we might be close to some real change.

      No, we'll just be in for more bullshit articles about how government regulations are stifling innovation.

      What we really need is some basic R&D into why conservatives hold on to the mantra that the free market cures all ills when it's been shown time and again to fail completely in so many areas.

      • Re: (Score:3, Interesting)

        by Darinbob (1142669)
        When the US was at the top with R&D, during the big "capitalism vs communism" cold war, it wasn't because of the free market really. It was from using a lot of tax money to fund basic research and education. Not exactly what modern conservatives think of as "capitalist". Was the money mispent? Some probably was, but that doesn't negate the benefits we got from when it was spent well.
    • Re:Surprising (Score:5, Insightful)

      by Keith Duhaime (139896) on Sunday August 30, 2009 @01:19PM (#29252629)

      Forget the Wall Street Journal. This needs to resonant with the Dicks and Janes that walk main street USA. The US is racking up record deficits and debts, a huge chunk of which is borrowed from foreigners. It's economy is still reliant on important strategic resources like oil. There is only so long it can go on doing this. At some point, the US must produce goods and services for the global marketplace that are competitive enough to generate the tax base to not only stem future deficits, but also pay down some of the accrued debt. When I put what this article has to say together with some of the more recent studies on US literacy and numeracy, the picture is pretty scary. There is some life to the US economy right now, but what happens when all the stimulus money dries up, and foreign investors realize that US T-Bills, savings bonds, and even US currency potentially isn't worth the paper it is written on? The financial turmoil of the last 12 months is going to look like a cakewalk then.

  • by zoney_ie (740061) on Sunday August 30, 2009 @12:07PM (#29252003)

    We've invested in basic research here in Ireland, and the government is being criticised for it (link to Irish Times opinion piece [irishtimes.com]).

    Certainly there is a problem here in Ireland that there are a lack of opportunities for those who've acheived a PhD qualification through basic research. Already a lot of even ordinary degree graduates in science and technology have emigrated from Ireland, and the number of entrants into such undergraduate courses is dropping year by year.

    However, possibly there's nothing inherently wrong with investing so much in basic research and the issues arise merely from the ineptitude of those running this country and the blind voting that such a section of the populance do for the current ruling party - who've throughout Ireland's history acheived lots of public support but attempted to ruin the country at various stages (starting with the Civil War, continuing with the economic war with the UK in the 1930s, going crazy in the 1970s even abolishing car tax to win votes as the country went bankrupt, deliberately facilitating a property bubble after the dot-com crash, attempting to have the taxpayers continue to pay into the Ponzi scheme with a unique Irish version of the bad bank - i.e. pay speculative amounts to banks for bad loans and attempt to keep prices up until a new bubble is created).

  • Socialism (Score:5, Insightful)

    by P0ltergeist333 (1473899) on Sunday August 30, 2009 @12:08PM (#29252011)

    Government spending on R&D? That's socialism! I thought everyone knew that taxes are bullshit. It's not like government funded basic research ever gave us anything useful like the transistor.

  • Yeah so... (Score:5, Insightful)

    by ComputerGeek01 (1182793) on Sunday August 30, 2009 @12:17PM (#29252097)

    All of you Genetisists with your fancy degrees start discovering stuff, but remember if you start playing god again we are going to complain to the governement...

    All of you Nuclear Physists start making your reactors and glowey things, but not in my back yard! I don't want that nuclear waste making my McDonalds Double Cheesburger unhealthy!

    The same for all of you green energy people with your wind turbines you need to start building this renewable energy! but not in my neighborhood you're destroying the value on my now worthless house!

    Clearly this is everyone's fault except for mine, now if you'll excuse me I'm late for second job delivering pizza's I'm glad I never went to college otherwise I might be expected to do something about this! - The American Public

  • Greentech! (Score:5, Insightful)

    by EricBoyd (532608) <.moc.oohay. .ta. .dyobcirerm.> on Sunday August 30, 2009 @12:18PM (#29252099) Homepage
    "Name an industry that can produce 1 million new, high-paying jobs over the next three years", challenges BusinessWeek. The obvious answer is Greentech. We need to scale wind and solar power production rapidly, for a whole host of reasons. Currently installed base took decades, and is still only 1% of the electric grid, so clearly there is lots of room to expand... and that's not even counting such opportunities as electric cars.
    • Re:Greentech! (Score:5, Insightful)

      by Geoffrey.landis (926948) on Sunday August 30, 2009 @12:40PM (#29252269) Homepage

      "Name an industry that can produce 1 million new, high-paying jobs over the next three years", challenges BusinessWeek. The obvious answer is Greentech...

      Actually, that's moderately insightful. There's a persistent stereotype that "green" meaning a step backward in technology, but, realistically, it's exactly the opposite-- true green means high technology. Family-farms and kerosene lanterns won't cut it in the 21st century. There's a lot of technology improvements needed-- both in power production, and in improving efficiency, and materials science improvements needed to implement recyclability-- and this represents real market value.

      • Re:Greentech! (Score:5, Insightful)

        by drinkypoo (153816) <martin.espinoza@gmail.com> on Sunday August 30, 2009 @01:15PM (#29252579) Homepage Journal

        Actually, that's moderately insightful. There's a persistent stereotype that "green" meaning a step backward in technology, but, realistically, it's exactly the opposite-- true green means high technology.

        The true story is that we are far underutilizing the technology we have. We could have more small, local generation of power from wind and solar; the wind stuff can be made from recycled materials, and solar panels were able to pay back the energy cost of their production in less than a decade back in the seventies. It could probably never fill all demand, but we already use multiple forms of power.

    • by kabloom (755503)

      Are the science and money there to make it happen in a paradigm-shifting way? Or is it just a bunch tweaks on existing industries?

    • Re: (Score:3, Interesting)

      by DerekLyons (302214)

      "Name an industry that can produce 1 million new, high-paying jobs over the next three years", challenges BusinessWeek. The obvious answer is Greentech. We need to scale wind and solar power production rapidly, for a whole host of reasons.

      It's not obvious at all. While it's true, Green tech can produce a few high paying jobs in research, development, and management... The bulk of the jobs are going to be [relatively] low paying grunt work out in the field installing the things.

  • Individual (Score:3, Interesting)

    by Bodero (136806) on Sunday August 30, 2009 @12:18PM (#29252109)

    as corporations and government make the same decision to free-ride off the investments of others, society suffers the 'tragedy of the commons,

    How about the individual? You know, the type that parrots around here against the patent system (or at the very least, software patents), and screaming how they use Pirate Bay to protest them? How about the individuals who demand our government buy price-controlled medicine from Canada to deny the organization who discovered it the fruits of their labor, and the ability to recoup their investment?

    Creators and inventors see a hostile environment for profiting off their works, so they stop investing in creating and inventing. Film at 11.

    • Re: (Score:2, Informative)

      by Kratisto (1080113)
      Yeah, just the other day I had my multibillion dollar corporation download some illegal patents off TPB so I could throw them into full scale production without giving the inventors and researchers any credit or any money.
    • Re:Individual (Score:5, Insightful)

      by pesho (843750) on Sunday August 30, 2009 @01:03PM (#29252471)
      How about the individuals who demand our government buy price-controlled medicine from Canada to deny the organization who discovered it the fruits of their labor, and the ability to recoup their investment?

      This is not exactly true. The fact is that the drug industry is making handsome profit at the prices they sell in Canada, Mexico or Europe. They easily recoup their R&D costs. Besides, R&D expenditures in the pharma industry are relatively small part of their budget. For example marketing costs are about 3 times as much (can you turn on TV and not see an add for a prescription drug?) . Even manufacturing costs are higher. The reason for this is that all the basic research as well as some of the drug development is done by universities and payed by grants from the government (NIH, DoE, DoD, NSF) and non-for-profits. Creators and inventors see a hostile environment for profiting off their works, so they stop investing in creating and inventing.

      Creators and inventors do what they do because they enjoy it. Making money is a second or third motivator. If it was the primary goal they would be in marketing selling you stuff from China that you don't need.

    • Re:Individual (Score:5, Insightful)

      by Stiletto (12066) on Sunday August 30, 2009 @01:26PM (#29252697)

      deny the organization who discovered it the fruits of their labor

      Call it anecdote, but I find that the people most likely to use the phrase "fruits of ... labor" tend to be the people least likely to have ever performed an hour of true hard labor in their lives.

      Like the Rugged Individualist(TM) who goes on and on about how he shouldn't pay taxes and should be able to keep the "fruits of his labor" when it turns out he resets people's passwords and reboots servers for a living.

      • Re:Individual (Score:4, Interesting)

        by Bodero (136806) on Monday August 31, 2009 @06:59AM (#29258771)

        How is your typical tirade of class envy rated 5? Yeah, the only people who defend the idea that people should keep what they make should be the rich. Everyone else should vote with their caste! Poor? Vote for the party of free money, don't work to advance yourself!

        This kind of attitude is a big reason we are in the debacle we are in now.

    • by khasim (1285) <brandioch.conner@gmail.com> on Sunday August 30, 2009 @01:53PM (#29252963)

      You know, the type that parrots around here against the patent system (or at the very least, software patents), and screaming how they use Pirate Bay to protest them?

      Pirate Bay is more about copyright. Not too many people go to Pirate Bay to find a torrent of the latest metallurgical advancements.

      How about the individuals who demand our government buy price-controlled medicine from Canada to deny the organization who discovered it the fruits of their labor, and the ability to recoup their investment?

      That depends upon what you mean by "recoup". Are you talking 1=1 where they make back the money they spent only on that project? Or 10x the money? or 100x the money? or where they can keep turning a profit on that research forever just because they were the first ones to get it filed?

      Creators and inventors see a hostile environment for profiting off their works, so they stop investing in creating and inventing. Film at 11.

      No. The "hostile environment" for real research is from patent trolls.

      The "hostile environment" for copyright is from one company that wants to keep turning a profit off of a cartoon of a mouse.

      Just look at the salaries that are paid in those industries. And the multi-million dollar awards given them by the courts.

  • by rcoxdav (648172) on Sunday August 30, 2009 @12:21PM (#29252127)
    I think a lot of the lack of R&D goes back to decisions made many years ago by the government. At one point all employee salaries regardless of how outrageous they were were a deductible expense. Congress decided they wanted to tax high salaried people. Therefore companies found ways around those laws. In comes stock bonuses and stock options. The problem with that is that a highly paid employee (most likely a decision maker) will do what is best for them, which is kick up the stock price so that they get higher effective pay. Easy way to do that, kill long term R&D. In addition with companies hiring people with business BS degrees who then get an MBA to manage, instead of the engineers, everything is looked at on the current P&L statement, not the 10+ year roadmap.

    The combination of the higher ups wanting short term profits due to changes in tax law, along with many fewer R&D companies (HP for example) having engineers and technical people making decisions has decimated R&D.

    I remember when HP meant test equipment and awesome calculators, not lousy consumer based computers (Thanks Carly). Another example, don't laugh too hard, is Radio Shack. I used to work for Radio Shack in the late 80's and the early 90's. When I started, they actually had R&D (they had a dye based CD-R technology they were working on, but had RIAA type problems with), manufacturing, a lot of electronic components, etc. When the founder of Tandy died, the MBA style management came in. They started off selling manufacturing, as that was not part of the "Core Business", sold off the credit card division, which made a nice one time profit, that then really made customers made because of lack of customer service, and lowered sales because of tighter credit requirements. They stopped carrying a lot of small parts, because of the low dollar value, regardless if they were high profit. In short, Charles Tandy, the leather salesman, ran it better and more profitably than the "business school" people that were bought in because he understood the business. We need to find a way to encourage the people who know the business they are in to get higher up and make decisions, rather than feeding the orgy of MBA's and people with business degrees that now rule most companies. As to how, I have very little in the way of ideas, but I think some tax law encouraging long term and pure science R&D would be helpful, if it could not be bastardized for other purposes (yeah, I know, a pipe dream).
    • by jopsen (885607) <jopsen@gmail.com> on Sunday August 30, 2009 @01:11PM (#29252541) Homepage

      I think a lot of the lack of R&D goes back to decisions made many years ago by the government. At one point all employee salaries regardless of how outrageous they were were a deductible expense. Congress decided they wanted to tax high salaried people. Therefore companies found ways around those laws. In comes stock bonuses and stock options. The problem with that is that a highly paid employee (most likely a decision maker) will do what is best for them, which is kick up the stock price so that they get higher effective pay. Easy way to do that, kill long term R&D.

      In a capitalistic society management (decision makers or highly paid employees) serves the interest of the stockholders... And most stockholders want money on a short term... Not long term risky investments...
      I doubt higher taxes on high incomes has much to do with this...

      The solution is not necessarily communism... - But government investments can be a part of the solution... subsidizing certain industries might be an idea too... In Denmark the government subsidized every watt produced using wind energy, thus driving research in this area... In Germany it was solar energy...

    • by weston (16146) <westonsd@@@canncentral...org> on Sunday August 30, 2009 @01:43PM (#29252865) Homepage

      I think a lot of the lack of R&D goes back to decisions made many years ago by the government. At one point all employee salaries regardless of how outrageous they were were a deductible expense.

      This sounds fishy to me. Can you cite the change in the tax code? I am not a tax accountant, but it's my understanding salaries are in fact still "deductible" in the sense that they count as an expense against profits. Are you saying they used to be deductible against gross revenue? And how does this fit in with the large "bonuses" that are essentially high salary compensation?

      I'd agree that regardless of the tax structure, though, the principal-agent problem [wikipedia.org] and short-term thinking is... well, a problem.

      I remember when HP meant test equipment and awesome calculators, not lousy consumer based computers (Thanks Carly).

      The interesting thing is about Carly's reign is that even by short-sighted Wall Street analyst standards, it should serve as a pretty bright warning sign for suits looking to dismantle an engineering company. HP's value dropped "down two-thirds from its peak" [msn.com] while she was running the company and jumped up over 10% at one point the day the news of her ousting broke [cnn.com].

      (Now, of course, she's going into politics. For some reason McCain took her on as an economic adviser for a while, despite her track record. Which she appears to think qualifies her as a brilliant candidate for the U.S. Senate.)

  • It's incredible how successful other companies were at commercializing the amazing basic discoveries or inventions that came out of Bell Labs (transistor, laser, Unix, etc. etc. etc.), and somehow AT&T never was all that successful at commercializing these discoveries, and ended up spinning off Bell Labs and selling out to SBC.

    Bell Labs held many, many patents from all this basic research, that ultimately weren't nearly as profitable as the inventions that used them. Lessons for those who insist that

    • by skwang (174902) on Sunday August 30, 2009 @12:49PM (#29252345)

      Bell Labs was a subsidiary of the Bell Telephone company. Since the telephone company was a regulated utility, and a monopoly, the US government did not allow it to commercialize many of its discoveries and inventions. UNIX for instance was "given away" with a license to universities (e.g. UC Berekely), companies, and the government.

      I believe the conclusion you drew is incorrect because it was based on the faulty assumption that Bell Labs tried to commercialize and profit off its products, when in fact it could not.

      • Re: (Score:3, Interesting)

        by GGardner (97375)
        The consent degree did not apply to Lucent after it was spun off, and they did even worse. Moreover, lack of commercialization was true at _all_ the privately run labs. How much did Xerox make from PARC's great Computer Science work? IBM from T.J Watson?
      • by julesh (229690) on Sunday August 30, 2009 @01:11PM (#29252543)

        I believe the conclusion you drew is incorrect because it was based on the faulty assumption that Bell Labs tried to commercialize and profit off its products, when in fact it could not.

        Indeed. And the same point should probably be made about Xerox PARC; a lot of really good basic research went on there, but the management of the company had little clue what to actually do with it. The graphical user interface, the WYSIWYG word processor, object-oriented programming -- all of these were PARC innovations, and Xerox did almost nothing to commercialise them. In the end, Xerox was simply content with being a photocopier manufacturer. Laser printers were close enough to that core business to fit in; graphical networked workstations, operating systems and programming langauges weren't.

        • Re: (Score:3, Interesting)

          by TheRaven64 (641858)
          The laser printer made more for Xerox than the total cost of all other research conducted at PARC from its inception to the time it was spun off. They didn't commercialise the GUI themselves, but they got a chunk of Apple stock in exchange for letting Apple develop it (no idea how much they sold it for, but if they'd kept it until now then it would probably be worth a huge amount). Presumably they got a chunk of 3Com in exchange for the Ethernet patents. They spun of Smalltalk development too, and eventu
  • by MrCrassic (994046)

    Research in the sciences usually requires a Ph.D level education. We (US) don't have nearly enough Ph.Ds to answer that challenge.

    Plus, people who hold a Ph.D in the sciences aren't exactly unemployable, even in "this economy..."

    • "Research in the sciences usually requires a Ph.D level education."

      Is that a bureaucratic requirement or a practical one?

      • by blueg3 (192743)

        Practical. Basic research requires quite a lot of specialised knowledge, training, and practice.

  • by duffbeer703 (177751) on Sunday August 30, 2009 @12:32PM (#29252205)

    Sometime in the late 60's/early 70's, economists and politicians began to see honest growth based on adding value and fair trade as something that would slow the growth of the US economy, and leave the country unable to pay for the massive military and social programs that we are committed to. How many trillions of dollars were invested in ICBM silos? Strategic Air Command bombers and tankers that are still flying today by the grandchildren of the original pilots because they were never needed in the first place?

    We made the switch from scientific and industrial powerhouse to empire. Instead of building factories, we build relationships with dictators. Instead of employing citizens in manufacturing, we exploit peasants in East Asia. I live in Albany, NY. Thanks to government, this area is pretty prosperous. But as you drive west through once-thriving cities like Amsterdam, Utica, Syracuse, Rochester and Buffalo, you are a witness to economic devastation as the region declines to a shadow of its former self.

    We live in an age of false prosperity, where our chief export is the wealth of the nation.

  • Of course this is right, and we need to re-encourage investment in basic science in all of the goverment, Universities and Industry and it needs to be in Basic Science, _not_ short time applied science, engineering or product development and anyone with an MBA needs to be disqualified from any part of the decision making as do almost all pols, except to do it.

    The problems are:
    (a) short term-ism on Wall Street,
    (b) good and improving engineering education in China and South East Asia
    (c) the fallacy that the "
  • by fast turtle (1118037) on Sunday August 30, 2009 @12:39PM (#29252267) Journal

    The first factor that has to be corrected is the entire Education System in the United States because until the many problems (rote memorization favored over critical thinking) is fixed, we simply wont have the bodies needed to do any basic research. The next factor that has to be solved is the Governments continual slide into Mediocracy and illeteracy that's been desired by the Corps and Politico's for the last 30 years. Sorry folks but that's at least 2 generations (not counting the current and future gens) that have been robbed of our Constitutional Requirement for both an educated and armed populace. Instead they've wanted sheep and now they've got them who don't care about anything except where their next fix is coming from (be it telivision, latest hip product, drugs).

    Sorry to say but if the founding fathers were to attempt a revolution with our current tranqed populace today, they'd have failed and been executed as terrorists instead of hailed as hero's. In fact, General Orders to HighGaurd. Time to throw a Nova Bomb into Sol's Sun and clear the cockroaches before they spread to the rest of the galaxy.

  • by VGPowerlord (621254) on Sunday August 30, 2009 @12:41PM (#29252273)

    If you want the literal answer to this question, they're part of Alcatel-Lucent now, after being part of Lucent Technologies since AT&T spun them off in the 90s.

  • by cbraescu1 (180267) on Sunday August 30, 2009 @12:50PM (#29252355) Homepage

    Name an industry that can produce 1 million new, high-paying jobs over the next three years

    Government!

  • by PhysicsPhil (880677) on Sunday August 30, 2009 @12:55PM (#29252391)

    It's interesting to note that most of the top-tier research facilities of the past were backed by monopoly or near-monopoly corporations. Bell Telephone speaks for itself, IBM Labs was supported by revenue of a dominating computer manufacturer, Sarnoff is the old lab facility of RCA, which for a time had sufficient clout to pretty much set the price of vacuum tubes. Xerox was the dominant photocopier supplier in an era of large growth. In today's world, Microsoft is one of the biggest spenders on research, and they have their own cash cow from a software monopoly.

    One wonders if the ability to fund basic research depends on having a nearly monopolistic revenue stream. And if that's the case, are we prepared to suffer monopolies to get the research that comes with them?

  • by fermion (181285) on Sunday August 30, 2009 @12:56PM (#29252403) Homepage Journal
    This is what we are talking about, and having 5% to spend is not easy. It requires planning and determination. We can see how difficult this is at the micr level with families. Take an average family bringing in 4K a month. How many spend even $200 a month on education? Sure some invest in private school, but I am talking about suitable books, cultural events, etc.

    So firms must find the 5%. This happens through efficiencies and prices. A choice must be made between all those wasteful middle managers that do nothing, or research.Everyone has a useless in law that needs a job, so create another wasteful middle manager position. Or perhaps someone needs external validation, so build another wasteful highrise to stroke someone ego.

    The there is profit. The pharmaceutical firms are doing research, but then what happens when they try to pay for the research? Everyone screams, like drugs are an entitlement. It is the pursuit of happiness, but the entitle to it. Is everyone going to be able to afford all drugs in the US. Perhaps is universal healthcare is passed, otherwise it will be the free market deciding that those with money will live, and those without will just have to make do.

    Then, of course, on has to convince the stockholders that a reduction in per share profit is a good thing. Not an easy sell when many will buy solely on the basis of net profit.

    I am not sure if industrial research labs are going to work in the current climate. Research based companies seem to get clobbered by those who merely derive products from the research. The model emerging over the past 20 years of so, private public research partnerships, seem to be a pretty good job. The reason we see so little of it in the US is that owners of firms are primarily concerned abut their 100 million dollar paychecks, not the long term effects they have on the company, the country, and the world. Why else would the auto manufacturers not use their windfall over the past decade to build the next big thing. Why would oil companies use their windfall to create false document, a la big tobacco, against alternative energy sources rather than develop those alternative energy source. Why else would MS buy a virtualization company, way before MS Vista, a not integrate that technology into Vista to form a transitional compatibility layer, as Apple did between OS 9 and OS X.

    Really, research labs are not the issue, cowardice is. When we have leaders that are not scared of their own shadows, when we have leaders that will go out a defend us against the real enemy, and not waste a trillion dollars attacking a fake proxy enemy or create FUD to distract us, then we will have progress.

  • by Animats (122034) on Sunday August 30, 2009 @12:58PM (#29252417) Homepage

    A real question is whether basic research mines a depleting resource. The issue is not whether more can be discovered. The question is whether basic research is still cost-effective.

    The problem is that we've found most of the easy hits in science and technology. Edison's lab, circa 1880, had a goal of one minor invention every three days and one major invention every two months. This was with a rather modest staff, about 40 people. In no area of science is that level of output possible today. Everything that easy has already been done.

    One guy built the first IC in two months at Texas Instruments, without much help. Several early microprocessors were designed by teams of about 5 people. It took 3,000 people, in grey cubicles in Santa Clara, to design the Pentium Pro/II/III architecture, the first superscalar IC. (Getting a working design out of 3000 people for something as tightly integrated as a fast superscalar CPU for a complex architecture was an incredible management achievement.)

    Xerox PARC, in its heyday, had a nearly open field in which to work. PARC was funded on the concept that if they did things which cost too much now, they'd be affordable later and Xerox would own the technology. So they built things like the Dover (a $100,000 laser printer) and the Alto (a $30,000 single-user computer), and they built enough of them to be useful experimentally. So they were able to make major progress with about 40 people in the computer science section. (PARC seemed bigger, but a big part of PARC was copier technology development. Everybody forgets those people, but they filled much of the building.) Now it takes resources like that to develop a midrange cell phone.

    There's a curve here, it gets steeper, and not in a good way. The easy stuff is discovered/invented first, then the harder stuff. Each new bit of progress comes at a higher price. It's like mining lower and lower grade ore as the good stuff runs out.

    Those are places I know about and visited at one time or another, all in semiconductors and electronics. I can't speak for biotech, which seems not to be as far up the curve yet. On the other hand, consider aviation and rocketry, where the easy part ended in the 1960s. Look at progress in aviation between 1903 and 1956 (Wright Flyer to Boeing 707), then 1956 to 2009 (Boeing 707 to Boeing 787). Or rocketry between 1929 and 1969 (Goddard rocket to Apollo) and 1969 to 2009 (Apollo to Shuttle).

    • by stupendou (466135) on Sunday August 30, 2009 @01:21PM (#29252653)

      I find this to be a narrow-minded view, despite the points well-taken about research getting harder and harder in general.

      Case in point: mobile-phone technology. How many patents have been generated from that? How many new jobs around the world? You'd have thought the "hard-part" of basic radio research was over long ago.

      Sure, the low-hanging fruit has been plucked. However, we have so much more knowledge to build on and such better tools these days with which to do the research that, even though the overall job is harder, it can be done quicker and more efficiently than ever before.

      Curves/trends are useful for predictions, until something comes along that no longer fits. And it's impossible to predict when that something will arrive. But if we don't fund basic research adequately, it'll likely take that much longer.

  • by plopez (54068) on Sunday August 30, 2009 @01:52PM (#29252961) Journal

    In reading some of the comments, people don't seem to understand the purpose of patents.

    The true purpose of patents are not so much to act as incentives to innovate, that will happen anyway as long as innovation can produce a profit though the innovation becomes a trade secret.

    The purpose of patents is information sharing. The patent holder is given a monopoly for a limited time but must reveal the workings of the innovation. By revealing the information others can study it, improve it and use it to advance the state of the art.

    I hope this BW article doesn't lead to the same lunacy to extend patents that happened with copy rights to "incetivize" innovation since that would defeat the purpose.

    Also, the short term view that the business school developed in business "leaders" is nothing more than self cannibalization. Tech companies have been devouring themselves, riding on technology they developed years ago and not laying ground work for future profitability through solid basic research.

    In addition, by outsourcing and offshoring they have been choking off their own sources of future leadership in personnel. The skilled workers they need are developing their skills working for other companies.

    Here's my observations. Many of the IT people of my generation began as help desk (some times part-time while in school or summer jobs), the jr. sys-admins or consulting finally working their way up to senior positions or creating their own companies'. They sometimes were hired internally to a company since they knew the company and the company knew them. That path allowed for slow gradual developed of skill sets, maturation and exploration of interests. With offshoring and outsourcing that path is becoming rarer. And so now companies when they do look for IT/programmers bemoan the lack of skilled workers.

    This also creates a chilling effect when people look for careers in the Sciences, esp. when it is easier to get an MBA than a Phd.

    I tried to make these points to a Phd in Chemistry who had worked his way up into mgt. in a pharmaceutical company which was offshoring research, but he didn't get it. A bright guy, but he didn't get it.

  • by cdrguru (88047) on Sunday August 30, 2009 @02:34PM (#29253305) Homepage

    Today, if a research organization creates something new and exciting, it can generally be duplicated in China in less than a year - often three weeks or so. This eliminates any possibility of the "innovator" reaping any sort of reward for their efforts. What company wants to spend money only to hand a gift over to someone in China?

    Today one example is DVD players. We have cheap DVD players because the patent licensing is not being enforced. The license fee per DVD player is $5, which would translate to around $50 at the retail level. There are plenty of $29.99 DVD players being brought into the US for which no license fee was ever paid. And this is just one example I personally know about. There are thousands more.

    So while 50 years ago (or even 30) you could create something new and develop a product based on it. This product would be sold and the developer would get paid. Sometimes, for the right product, it might be "knocked off" in China but the cost differentials were not as they are today. So you could still sell the "original" product for a reasonable price.

    Today, between the Internet making it all about lowest price, customs officials looking the other way as far as patent licensing is concerned and labor costs skyrocketing developing a product in the US or Western Europe is pointless - as is the R&D behind it. Why would anyone spend the money on R&D when the fruits of their labor is going to be taken by a foreign operator?

    Short answer is, this isn't going to get fixed anytime soon. R&D is dead and buried. We will eventually have some R&D again, but not until the current globalization situation sorts itself out.

    • by mpapet (761907)

      Today, if a research organization creates something new and exciting, it can generally be duplicated in China in less than a year - often three weeks or so.

      That's an 'Apple' version of research. This isn't hard research, it's repetitive research tinkering with products that have well developed components. The thinking behind calling this 'research' is a kind of buying short-term attempting to turn it into long-term market capture (higher prices) using patent and intellectual property law to maintain mark

  • Um...NSF? (Score:3, Insightful)

    by Danathar (267989) on Sunday August 30, 2009 @08:37PM (#29255923) Journal

    Not one mention of the National Science Foundation which pumps billions of dollars into basic science research per year......

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