- Timing of expected revenues vary.
- Across all applications, revenues are expected:
- for 1 out of 5 applications by the end of ATP funding;
- for 2 out of 5 applications within a year after ATP funding
ends; and
- for 4 out of 5 applications within three years after
ATP funding ends.
- Technology
affects timing of revenues.
- Information technology (IT) applications are anticipated
to earn revenues very quickly.
- 27% by the end of ATP funding; and
- 54% within another year.
- Materials-chemicals, and manufacturing applications are anticipated
to be the slowest to earn revenues. These applications are
expected to lag IT by about a year.
- 8% and 12%, respectively, by the end of ATP funding; and
- 54% and 57%, respectively within two years after ATP funding.
- Early
biotechnology applications follow the “average” in
the early years, but there is a noticeable second peak five
or more years out.
- Expectations about when commercialization and revenues
will occur tend to mirror the expected windows of opportunity.
- Anticipated market windows vary by technology area in the
same manner as expected revenues.
- Industry factors may help account for the differences.
- Biotechnologies
and information technologies are “young” and
often help form new industries.
- Companies are typically young and product markets are
essentially new.
- Focus is on achieving basic functionality and performance.
- Early opportunities for service applications (e.g., research
and testing services for biotechnology and custom software
development and installation for information technology)
are useful for market conditioning and validation.
- Early cash flows are earned but generally do not generate
big revenues or economic impact anticipated for therapeutic
markets or for broadly distributed software.
- Biotechnologies aimed at human therapeutics often require
considerable technology development beyond ATP, extensive
regulatory testing and trials, and production and distribution
licenses with larger companies before they can make a
major impact.
- Manufacturing and chemicals projects more typically develop
new process technologies for existing classes of products
in mature, commodity-oriented industries.
- Focus
is manufacturability and cost to gain advantage in “cents per pound,” high-volume
markets.
- Capital investment and validation requirements are costly
and lengthy.
- Product life cycles and market windows are longer than
for IT or electronics products.
- Technological change for commodities occurs more slowly
than in high-value product areas.
- Electronics
and materials projects tend to involve a mix of “young” and “mature” industries.
- Product applications are more common than process applications.
- Cost and manufacturability are critical technical and
business objectives.
- Electronics product markets are extremely competitive,
product life cycles are very short, and capital requirements
are often steep barriers to market entry.
Factsheet
1.G3 (July 2001).
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