Ask the Scholar
Document scope · 1 page
Scholar
Ask about this object, its catalog metadata, its source description, or the page inventory.
For page-specific OCR and visual context, open one of the page chats.
Source Description
Records pertain to the Office of Science and Technology Policy.
Scholar Source Context
Document identity
localId
285790763
label
Science & Technology [2]
core
doc
dtoType
document
citationUrl
pageCount
1
Source metadata
id
285790763
contentType
document
title
Science & Technology [2]
description
Records pertain to the Office of Science and Technology Policy.
citationUrl
identifierLocal
04295-018
collections
Records of the Economic Policy Council (George H. W. Bush Administration)
Olin Lewis Wethington Subject Files
imageCount
1
hasImages
yes
source
import
hasTranscription
no
Source extras
naId
285790763
levelOfDescription
fileUnit
recordType
description
ocrSource
nara-archive
Single page context
seq
1
pageIndex
0
type
document
mediaId
2b2d7d4c3bf59081
ocrText
Originally Processed With FOIA(s):
FOIA Number:
2005-0336-F
2005-0336-F
FOIA
MARKER
This is not a textual record. This is used as an
administrative marker by the George Bush Presidential
Library Staff.
Record Group/Collection:
George H.W. Bush Presidential Records
Collection/Office of Origin:
Economic Policy Council
Series:
Wethington, Olin, Files
Subseries:
Subject Files
OA/ID Number:
04295
Folder ID Number:
04295-017
Folder Title:
Science & Technology [2]
Stack:
Row:
Section:
Shelf:
Position:
G
13
28
4
1
[64] From: Maryanne Bach at NCMC 3/21/91 8:28AM (1510 bytes: 24 1n)
To: William D. Phillips at OSTP, Jules Blake at OSTP, D. Allan Bromley at OSTP,
Damar Hawkins at OSTP, Kenneth P. Yale at OSTP
CC: Maryanne Bach, Thomas J. Welch
Subject: amendments to ATP/NIST
Message Contents
TO Dr. Bromley and Dr. Phillips:
I received a call from the Minority in the House last night
seeking our support for the objection that the
Secretary of Commerce, NIST and OMB will file if the
following amendment goes forward: Currently in the House
Subcommittee on Technology and
Competitiveness there are discussions underway
between staff and Congressman Mineta. The
amendment would be to the American Technology Preeminence
Act (this bill did not pass the Senate last year because of
Kasten's hold on it for the product liability amendment)
This bill includes the NIST
reauthorization for FY92. The amendment would establish
lending authority to American industry for up to 100% of the
current Hill proposed authorized level of the
NIST/Advanced Technology Program (Hill proposes $100m;
Administration proposes $36m). I understand DOC is strongly
going to oppose it and is working with OMB on the
justifications. Minority is looking for us to also strongly
oppose this action.
MCBach
Olin-
JuI
DRAFT
February 1, 1991
REPORTS REQUIRED BY OSTP OR FCCSET
THE SCIENCE AND TECHNOLOGY REPORT AND OUTLOOK - biennially, to be
submitted on January 15 of each odd numbered year. Mandated by P.L. 97-375.
(Wells, Ratchford, Maynard, Olson)
FULL REPORT TO THE PRESIDENT ON CRITICAL TECHNOLOGIES mandated
by Defense Authorization Act of 1990. Due in mid-January 1991.
NCMC REPORTS
CRITICAL MATERIALS REPORT - biennially, mandated by P.L. 98-373. Last
report was in the summer of 1988, but lack of a Council in the interim has delayed the
report until spring of 1991.
ADVANCED MATERIALS RESEARCH PROGRAM PLAN - annually, mandated by
P.L. 98-373. Last report was in January of 1989 but lack of a Council has delayed
report until the summer of 1991. (Lindstrom, Appleton, Phillips)
NATIONAL ACTION PLAN FOR ADVANCED SUPERCONDUCTIVITY RESEARCH
AND DEVELOPMENT - annually for five years, mandated by P.L. 100-697. NCMC
and OSTP are to work together to produce and update the Plan.
LONG-RANGE MATERIALS ASSESSMENT - annually, mandated by the National
Materials and Minerals Policy Research and Development Act of 1980 (30 U.S.C.
1601). OSTP should produce a long-range assessment of minerals and materials. P.L.
100-697 mandates that NCMC should assist OSTP with such an assessment.
TASKS IN SENATE APPROPRIATION LANGUAGE
FOR OSTP IN FY 1991
(as of February 1, 1991)
*(1) Rationalizing relationship and shared responsibilities with CEQ.
Report due by January 31, 1991 (Maynard)
*(2) Rank civilian R&D sectors by priority in terms of potential contribution to
economic competitiveness.
Report as part of 1992 budget process. (Phillips, Wong)
*(3) Identify the top 20 science prospects in the country according to the
Administrations priorities and show their life cycle costs. (Erb, Levinson)
(4) Develop a policy to implement the Packard-Bromley college and university
infrastructure rebuilding recommendations from the 1986 WHSC Report on an
interagency basis. Report by April 1, 1991 and include the agency funding
profiles with OSTP 1992 budget submission. (Ratchford, Wells)
(5) Develop a strategy document indicating how the Administration expects to be
first in the world in S&M education by 2000; including measurable objectives
toward obtaining this goal.
Draft report to Committee by November 30, 1990. -- Completed --
(6) Develop a multilevel priority setting framework that will focus, integrate, and
where necessary, reassign agency roles in S&M education.
Report by November 30, 1990. -- Completed --
(7) Require all Federal agencies with R&D activities to establish education offices in
each of the Federal levels. Report by March 15, 1991 (Ratchford).
(8) Coordinate interagency activities toward developing laboratory-education
partnerships. Report by March 15, 1991. (Ratchford)
*(9) Move forward in establishing the Critical Technologies Institute.
Report by February 1, 1991. (Phillips, Van Cleave, Wong)
(10) Review and respond to the NSF/NAE report on the USGERP.
Report by February 1, 1991. -- Completed --
(11) Address key issues in the global change arena, e.g., what is the maximum
greenhouse gas level is acceptable and when will such a level be achieved and
stabilized. What is the Administration plan for developing an international
consensus including implementation strategies and timetables.
Report by March 1, 1991. (Maynard, CEES, CEQ)
116
COMMITTEE RECOMENDATIONS
AUTHORIZATION CHANGES
The Committee concurs in the following adjustments made by
authorization action:
[Dollars in thousands]
Committee
Fiscal Year
Program
recommenda
Change from
1991 request
tion
budget
Semitrailer, Tank, 5000G
0
34,000
+ 34,000
Small Unit Support Vehicle
$27,031
0
-27,031
Passenger Carrying Vehicle
5,570
0
-5,570
General Purpose Vehicle
7,890
0
-7,890
EUCOM Command Centers
7,395
0
7.395
USAREUR Tactical Command & Control Sys
5,966
0
5,966
Imagery Processing System
8,625
0
8,625
Total Package Fielding
10,758
0
10,753
TACTICAL AND SUPPORT VEHICLES
5,000 GALLON TANKER semitrailer
The Committee recommends $34,000,000 for the procurement of
480 5,000 gallon tanker semitrailers, as recommended by authoriza-
tion legislation.
SMALL UNIT SUPPORT VEHICLE
The Army budgeted $27,031,000 for procurement of the Small
Unit Support Vehicle. The Committee recommends denial of the
entire amount based on authorization action.
M915 LINE HAUL TRACTOR
The Army budget included no funds for procurement of the M915
or M916 Line Haul Tractors. The Guard and Reserve Equipment
budget included $31,000,000 for procurement of the M916. The
Committee is aware of unfilled and unfunded requirements for this
equipment. In addition, very attractively priced options are includ-
ed in the current multiyear contract for these vehicles. The Com-
mittee recommends $13,400,000 for the procurement of additional
M915 and/or M916 vehicles, the mix of vehicles to be determined
by the highest priority requirements. The Army can allocate a por-
tion of this procurement to Guard and Reserve components in ac-
cordance with overall priorities.
COMMERCIAL PASSENGER AND GENERAL PURPOSE VEHICLES
The Army budgeted $5,570,000 for procurement of passenger car-
rying vehicles and $7,890,000 for procurement of general purpose
vehicles. The Committee recommends denial of both of these re-
quests based on authorization action.
117
TRUCK SERVICE LIFE EXTENSION PROGRAM
In April, 1989, the Army released a Tactical Wheeled Vehicle
Modernization Plan. One of the elements of this plan is a Service
Life Extension Program (SLEP) for the Army's aging fleet of 2½
ton and 5 ton trucks. The original plan called for beginning this
program in fiscal year 1993; it has now been postponed to 1995.
The slip in the SLEP program is evidence of the low priority
which the Army places on it. It is claimed by some that the Army
perceives the SLEP program to be a fiscal threat to the Family of
Medium Tactical Vehicles (FMTV). FMTV is a new generation of
2½ ton and 5 ton vehicles. Initial procurement funding is included
in the fiscal year 1991 budget. The Committee states its strong sup-
port for FMTV and has approved all funding included in the
budget. The Committee believes that the linkage that some people
make between the FMTV and the SLEP is based on a misguided
perception.
The Committee believes that a well managed SLEP program can
be a cost-effective way to improve readiness and modernization of
the Army. This is particularly true of the reserve components
which have some of the oldest trucks in the inventory. The Com-
mittee believes that the first thing that needs to be done to in-
crease the priority of SLEP and to manage it effectively is to place
program management responsibility under the Program Executive
Officer for Combat Support. The Committee strongly urges the
Army to do SO.
Earlier this year, the Army received responses from industry to a
"market survey" for SLEP. The Committee believes that the Army
should use these responses to fashion a procurement strategy with
the objective of producing SLEP trucks which cost no more than
half of an FMTV. The program should be competitive and include
prototype testing. In addition to information received from the
market survey, the Army should take advantage of experience
gained with the Marine Corps SLEP program several years ago and
with SLEP programs conducted for foreign military sales.
The Committee believes that the program should begin immedi-
ately, with initial procurement funding beginning as early as fiscal
year 1992. The Army is directed to use fiscal year 1990 funds in the
amount of $10,000,000 to establish a program office, issue a solicita-
tion, and conduct prototype testing prior to source selection and
contract award. In order to assure that this happens, the Commit-
tee has included bill language which prohibits the award of an
FMTV contract until a SLEP solicitation has been released by the
Army. The Army is directed to provide the Committee with its pro-
curement strategy and program milestones no later than February
28, 1991.
EXPORT OF FOREIGN LUMBER
The Committee believes that the export taxes, tariffs and restric-
tions being imposed by Indonesia and Malaysia on the export of
tropical hardwoods, in particular on shipping dry Keruing and
Kapur lumber, is and will adversely impact the procurement of
military vehicles utilizing wood flooring. Examples of such vehicles
are flat bed trailers, low boy trailers, HMMWV, M35's, M54's,
SENT BY:Ofc. of Admin.
; 3-18-91 ; 2:20PM ; EOP Library, NEOB->
2023951575:# 2
118
(4) Sections 603 through 606, subsections (a) and (b) of section
607, and subsections (a) and (c) of section 608 of the Department
of Energy Organization Act (42 U.S.C. 4101 et seq.).
(b) CLARIFICATION OF FREQUENCY OF CERTIFICATION BY EMPLOY-
EES OF CONTRACTORS.-Not later than 30 days after the date of the
enactment of this Act, the regulations implementing section
27(e)(1)(B) of the Office of Federal Procurement Policy Act (41 U.S.C.
423(€)(1)(B)) shall be revised to ensure that a contractor is required
to obtain from each officer, employee, agent, representative, and con-
sultant of the contractor only one certification (as described in
clauses (i) and (ii) of that section) during the person's employment or
association with the contractor and that such certification shall be
made at the earliest possible date after the person begins his or her
employment or association with the contractor.
PART C-DEFENSE INDUSTRIAL AND TECHNOLOGY BASE
SEC. 821. ANNUAL DEFENSE CRITICAL TECHNOLOGIES PLAN
(a) INCREASED INFORMATION RELATING TO FUNDING.-Section
2508(b) of title 10, United States Code, is amended-
(1) by striking out "and" at the end of paragraph (1);
(2) by striking out the period at the end of paragraph (2) and
inserting in lieu thereof a semicolon; and
(3) by inserting at the end the following new paragraphs:
"(3) identify each program element (contained in the budget
information submitted to Congress by the Department of De-
fense in support of the budget submitted by the President pursu-
ant to section 1105(a) of title 31 for the first fiscal year covered
by the plan) for which funds are budgeted for the support of the
and development of any critical technology identified in the plan;
"(4) for each such program element-
"(A) specify the amount included for each critical tech-
nology covered by the program element; and
"(B) include a comparison of that amount with the
amount, if any, available to the Department of Defense for
development of such critical technology for the fiscal year
preceding the first fiscal year covered by the plan.".
(b) APPLICABILITY.-The amendments made by subsection (a) shall
apply to annual defense critical technologies plans submitted after
March 1, 1991.
SEC. 822. CRITICAL TECHNOLOGIES INSTITUTE
(a) ESTABLISHMENT.-There shall be established a federally
funded research and development center to be known as the "Criti-
cal Technologies Institute" (hereinafter referred to in this section as
the "Institute").
(b) INCORPORATION.-The Institute shall be incorporated as a non-
profit membership corporation.
(c) BOARD OF TRUSTEES.-(1) The Institute shall have a Board of
Trustees (hereafter referred to in this section as the "Board") com-
posed of 21 members as follows:
(A) The Director of the Office of Science and Technology
Policy, who shall be Chairman of the Board.
(B) The Secretary of Defense, or the Secretary's designee.
SENT BY:Ofc. of Admin.
; 3-18-91 ; 2:21PM ; EOP Library, NEOB->
2023951575:# 3
119
(C) The Secretary of Energy, or the Secretary's designee.
(D) The Secretary of Health and Human Services, or the Sec-
retary's designee.
(E) The Secretary of Commerce, or the Secretary's designee.
(F) The Administrator of the National Aeronautics and Space
Administration, or the Administrator's designee.
(G) The Director of the National Science Foundation, or the
Director's designee.
(H) Four members appointed by the Director of the Office of
Science and Technology Policy from among the members of the
Federal Coordinating Council on Science, Engineering, and
Technology (other than members of such council named in sub-
paragraphs (B) through (G)).
(I) Ten members appointed by the members of the Board re-
ferred to in subparagraphs (A) through (H) from among repre-
sentatives of industry and colleges and universities in the
United States.
(2)(A) The term of service of members of the Board appointed
under paragraph (1)(H) shall be four years, except that of the four
members first appointed, one shall be appointed for a term of one
year, one shall be appointed for a term of two years, one shall be
appointed for a term of three years, and one shall be appointed for a
term of four years, as specified by the Director of the Office of Sci-
ence and Technology Policy at the time of the appointments.
(B) The term of office for each of the members of the Board ap-
pointed under paragraph (1)(I) shall be specified by the appointing
members of the Board at the time of appointment.
(C) Members of the Board may be reappointed.
(D) A vacancy in a membership of the Board appointed pursuant
to subparagraph (H) or (I) of paragraph (1) shall be filled in the
same manner as the original appointment. A member appointed
under this subparagraph shall serve for the remainder of the unex-
pired term of his predecessor.
(3) The Board shall meet at least twice each year.
(4)(A) The Board shall have an executive committee composed of
the members referred to in subparagraphs (A) through (G) of para-
graph (1) and six of the members appointed pursuant to subpara-
graph (I) of such paragraph.
(B) The executive committee shall meet at least six times each
year.
(5) A member of the Board who is an officer or employee of the
United States may not receive pay for service as a member, other
than the pay provided for the member's position as an officer or em-
ployee of the United States.
(d) DUTIES OF THE INSTITUTE.-The Institute shall-
(1) survey the views of United States industry, colleges, and
universities, and Federal and State agencies, involved in re-
search, development, or utilization of critical technologies on-
(A) each critical technology identified in the most recent
biennial report of the National Critical Technologies Panel
established pursuant to section 601 of the National Science
and Technology Policy, Organization, and Priorities Act of
1976 (42 U.S.C. 6681); and
SENT BY:Ofc. of Admin.
; 3-18-91 ; 2:22PM ; EOP Library, NEOB->
2023951575:# 4
120
(B) each technology that the Institute considers critical
on the basis of its analysis of national and worldwide
trends in basic and applied research and development;
(2) on the basis of such views and analysis by Institute per-
sonnel-
(A) identify suitable near-term, mid-term, and 1016 term
national objectives for the research, development, and pro-
duction capability of the United States with respect to such
technologies; and
(B) prepare possible strategies for achieving the identified
objectives, including a discussion of the appropriate roles of
industry, colleges and universities, and Federal and State
agencies;
(3) publish reports, as appropriate, discussing-
(A) such national objectives and strategies; and
(B) progress in implementing such strategies and achiev-
ing such objectives; and
(4) at the direction of the Director of the Office of Science and
Technology Policy, provide technical support and assistance re-
garding policy formulation to the committees and panels of the
Federal Coordinating Council for Science, Engineering, and
Technology that are responsible for planning and coordinating
Federal Government activities that advance the development of
critical technologies and sustain and strengthen the science and
technology base of the United States.
(e) SPONSORSHIP.-(1) The Director of the Office of Science and
Technology shall be the sponsor of the Institute.
(2) The Director and the Board shall enter into a sponsor agree-
ment consistent with the requirements prescribed by the Administra-
tor for Federal Procurement Policy that are generally applicable to
sponsor agreements.
(3) The sponsor agreement shall-
(A) require the Institute to perform such functions for the
Office of Science and Technology Policy as the Director of that
office may specify consistent with the requirements of subsection
(d); and
(B) permit the Institute, subject to the concurrence of the Di-
rector, to perform functions for the member agencies of the Fed-
eral Coordinating Council on Science, Engineering, and Tech-
nology Policy.
(f) DEADLINE FOR CERTAIN ACTIONS.-The Director of the Office
of Science and Technology Policy shall take such actions as may be
necessary to ensure that, not later than 90 days after the date of the
enactment of this Act-
(1) the articles of incorporation for the Institute have been ap-
propriately filed;
(2) the corporate bylaws have been adopted;
(3) the Board members have been identified or appointed, as
appropriate;
(4) the initial officers of the Institute have been elected;
(5) the first regular business meeting of the Board has been
conducted; and
(6) the sponsor agreement referred to in subsection (e) has been
entered into.
SENT BY:Ofc. of Admin.
; 3-18-91 ; 2:22PM ; EOP Library, NEOB->
2023951575:# 5
121
(g) FUNDING.-(1) Subject to such limitations as may be provided
in appropriation Acts, the Secretary of Defense shall make available
to the Director of the Office of Science and Technology Policy, out of
funds available for the Department of Defense, $5,000,000 for fund-
ing the activities of the Institute in the first fiscal year in which the
Institute begins operations.
(2) There is authorized to be appropriated for the Institute for
each fiscal year after the fiscal year referred to in paragraph (1)
such sums as may be necessary for operation of the Institute.
SEC. 823. MANUFACTURING TECHNOLOGY
(a) IN GENERAL.-Title 10, United States Code, is amended-
(1) by redesignating chapter 149 as chapter 150;
(2) by redesignating section 2511 as section 2521; and
(3) by inserting after chapter 148 the following new chapter:
"CHAPTER 149-MANUFACTURING TECHNOLOGY
"Sec.
"2511. Definitions.
"2512. Management and planning.
"2513. National Defense Manufacturing Technology Plan.
"2514. Research and implementation.
"2515. Computer-integrated manufacturing technology.
"2516, Concurrent engineering.
"2517. Munufacturing extension programs.
2511. Definitions
"In this chapter:
"(1) The term 'manufacturing technology' means development
of techniques and processes designed to improve manufacturing
quality, productivity, and practices, including quality control,
shop floor management, inventory management and worker
training, as well as manufacturing equipment and software.
"(2) The term 'manufacturing extension programs' means pub.
licly-chartered organizations and services to transfer technology
and help modernize small manufacturers through research,
education and training, and outreach activities.
"§ 2512. Management and planning
"The Secretary of Defense, acting through the Under Secretary of
Defense for Acquisition, shall-
"(1) provide centralized Department of Defense policy guid-
ance and direction to the military departments and the Defense
Agencies on all matters relating to manufacturing technology;
and
"(2) direct the development and implementation of Depart-
ment of Defense plans, programs, projects, and policies that pro-
mote the development and application of advanced technologies
to manufacturing processes, tools, and equipment.
"§ 2513. National Defense Manufacturing Technology Plan
"(a) The Secretary of Defense, in coordination with the Secretary
of Commerce and the Secretary of Energy, shall develop and imple-
ment a National Defense Manufacturing Technology Plan (hereafter
in this section referred to as the 'Plan'). Subject to the authority, di-
114
strengthen U.S. economic interests in both areas, and how efforts
in both areas will enhance U.S. civilian research capabilities. Also,
the OSTP shall identify the top 20 civilian science projects in the
Federal budget, ranked according to the administration's priority,
and show their life-cycle cost projections.
The Committee is deeply concerned about the tremendous need
for funds for the modernization and rehabilitation of the Nation's
academic research facilities. The 1986 Bromley-Packard report,
done at the request of the OSTP, estimated that the current back-
log of facilities modernization needs, just for those institutions of
higher education dealing with the National Science Foundation,
was a staggering $10,000,000,000, and that a $500,000,000 a year
Federal investment, matched by an equal amount from non-Feder-
al sources, was need to reduce this shortfall over the next decade.
Unfortunately, this 1986 report, whose results have since been con-
firmed by additional studies by the National Science Foundation,
has not led to the development of a Federal strategy on academic
research facilities. Only the National Science Foundation, with a
modest $20,000,000 a year program, has attempted to address this
glaring deficiency in higher education. As a result, the Committee
directs OSTP to develop a policy on academic research facilities
modernization that includes all Federal research and development
agencies and a 5-year funding projection of the Federal contribu-
tion to this effort. This interagency policy should be submitted to
the Committee by April 1, 1991, and its funding profile should be
clearly identified in the fiscal year 1992 budget submission for all
agencies.
The Committee applauds the establishment of the Federal Co-
ordinating Council on Science, Engineering, and Technology
[FCCSET] interagency Committee on Science Education and
Human Resources. The Committee requests that this FCCSET com-
mittee prepare and submit a strategy document with its 1992
budget request that will describe how the President intends the
Nation will achieve the objective that by the year 2000, U.S. stu-
dents will be first in the world in science and mathematics achieve-
ments. The Committee expects that the report will be modeled
after the strategy document prepared by the FCCSET Committee
on Earth Sciences, and it shall include measurable objectives sup-
porting the national goals.
In addition, it shall include a multilevel priority-setting frame-
work that will focus, integrate. and where necessary, reassign
agency roles and responsibilities, along with the requisite program
development and budget proposals. The Committee requests that
this report specifically include milestones and assessment methods
that will be used to chart the Nation's progress in meeting the ob-
jectives. The OSTP should provide a draft report to the Committee
by November 30, 1990.
The Committee directs the OSTP to guide the mission agencies
in establishing and restructuring their offices of education to sup-
port science and mathematics education and to make the agencies
fully responsive to the FCCSET Education Committee's plan. Also,
OSTP shall ensure that each agency's office of education has pro-
grams directed at student and teacher segments from K through
graduate school.
115
The Committee strongly encourages efforts within the Federal
Government to strengthen the educational activities of Federal re-
search laboratories. Further, the Committee believes that the
OSTP should require all Federal agencies with research and devel-
opment activities to establish education offices at each particular
Federal laboratory under its control. The goal of such an effort is
to improve internal Federal agency science, mathematics and engi-
neering education programs, as well as foster education partner-
ships between various Federal labs and schools and academic insti-
tutions which are located near them. The Committee notes there is
a need to coordinate and disseminate information on these pro-
grams among the various Federal mission agencies, as well as be-
tween the National Science Foundation [NSF] and the Department
of Education. Therefore, the Committee directs OSTP to work with
the NSF, the Department of Education, and Federal mission agen-
cies to coordinate agency efforts to improve math, science, and en-
gineering education, particularly in the area of developing labora-
tory education partnerships. The OSTP shall report the status of
this effort and the agencies' funding needs for this activity to the
Committee by March 15, 1991.
Last year the Congress authorized funds for OSTP to establish
the national critical technologies panel, and a Critical Technologies
Institute, a federally funded research and development center
under the OSTP, to support it. The Congress took this step in the
belief that there was a need for the Federal Government to help
focus the Nation's efforts in developing precompetitive technologies
to support our knowledge-based economy, without picking winners
and losers in the marketplace. The Committee notes its strong sup-
port for this investment, and directs the OSTP to move forward in
establishing the Critical Technologies Institute, and to report to the
Committee on its efforts in this area by February 1, 1991.
The Committee is aware that a recent study by the National
Academy of Sciences Council strongly endorsed the U.S. Global
Change Research Program [USGCRP]. At the same time, the Acad-
emy's review raised concerns about the program which are shared
by the Committee. The Committee directs the OSTP to respond to
the review by February 1, 1991, with an emphasis on providing
stronger program management to: (a) use extramural advisory
expert panels for defining and evaluating the USGCRP's various
programs and the products they are designed to develop; (b) focus
agencies to produce research results specifically agreed upon by the
USGCRP interagency committee; (c) assure greater interagency co-
operation; (d) broaden involvement at the project level by the aca-
demic community, local, and State governments, and other nations;
and (e) schedule and report interim assessments of the USGCRP in
public forums.
Despite the Committee's strong support for the current global cli-
mate research program, the Committee believes that additional
global climate policy action needs to take place. In that light, the
Committee directs the OSTP to submit to it a report by March 1,
1991, that addresses several key issues. First, what the OSTP con-
siders to be the maximum concentration of greenhouse gases which
is acceptable, and the date by which those concentrations will be
reached and stabilized. Second, what is the U.S. contribution to the
234
National Defense Research Institute [NDRI]; Institute for Defense
Analyses [IDA]; Consolidated DOD software initiative-Software
Engineering Institute [SEI]; Logistics Management Institute
[LMI].-As part of its initiative to eliminate exorbitant growth in
funding for defense federally funded research and development
centers [FFRDC's], the Committee recommends budget reductions
for the defense agencies four FFRDC's. The reductions are the
shares each organization should absorb as part of the Committee's
overall recommendation to return total defense FFRDC funding to
the fiscal year 1987 level, as adjusted for inflation. Fiscal year 1987
was the peak year of defense RDT&E funding during the last
decade.
Full justification and direction for implementing this recommen-
dation are contained in the introduction to the RDT&E section of
the report. Although for accounting purposes, the recommendation
is assessed against defense agencies RDT&E program elements and
funding, the Committee intends that the reductions be applied
against total fiscal year 1991 funding for each of the FFRDC's. The
total funding for each organization includes direct appropriations
through RDT&E program elements (in two cases) plus additional
Defense Department contract funds.
The recommended funding for each FFRDC is: (a) $17,338,000 for
the Rand Corp.'s National Defense Research Institute, a reduction
of $3,580,000; (NDRI's total fiscal year funding was requested at
$29,500,000); (b) $86,110,000 for the Institute for Defense Analyses,
a reduction of $11,890,000 to the request; (c) $19,770,000 for Logis-
tics Management Institute, a reduction of $2,730,000; and (d)
$31,172,000 for the consolidated DOD software initiative--Software
Engineering Institute, a reduction of $3,400,000.
AIM-9 consolidated program.-The Committee recommends
$30,000,000 in a new defense agencies program element to fund a
joint Air Force-Navy program to develop enhancements to the
AIM-9 Sidewinder short-range missile. Such a consolidation al-
ready has been approved by the full Senate. Recommendations in
the Navy and Air Force RDT&E accounts eliminate separate fund-
ing for the duplicative, AIM-9 missile upgrade programs each serv-
ice was requesting for fiscal year 1991.
Strategic technology; high performance computing.-The Commit-
tee recommends $115,249,000, a net reduction of $92,500,000, to this
program element of several projects in the Defense Advanced Re-
search Projects Agency. This recommendation reflects: (a) the
transfer of the $108,000,000 requested for DARPA strategic comput-
ing activities to a new high-performance computing program ele-
ment; (b) the transfer of $9,500,000 requested for high-definition
display technologies to a consolidated program within the integrat-
ed command and control technology program element; and, (c) the
addition of $25,000,000 for the third year of the DARPA initiative
in concurrent engineering [DICE]. DICE is a manufacturing tech-
nology effort to combine computer-aided techniques and artificial
intelligence to design improved logistics technologies into products
from their inception.
The Committee recommends $128,000,000 for the new high-per-
formance computing program element in DARPA. This amount
represents an increase of $20,000,000 to the budget request to accel-
235
erate research in this critical technology. The separate program
element is intended to highlight the importance of DARPA's strate-
gic computing efforts and to improve congressional oversight.
DARPA, a national leader in high-performance computing, has
been assigned a leading role in the country's high-performance
computing initiative.
Critical Technology Institute.-As approved by the full Senate,
the Committee adds $5,000,000 to the budget for a Critical Technol-
ogy Institute. The Institute is intended to assist the White House
Office of Science and Technology Policy in planning and imple-
menting development of critical technologies related to national se-
curity and global economic competitiveness. The Committee ex-
pects that funds for continuing the Critical Technology Institute in
fiscal year 1992 and later years will be budgeted for outside the De-
fense Department.
Strategic environmental research program [SERP].-As approved
by the full Senate, the Committee recommends adding $200,000,000
to the budget request for a strategic environmental research pro-
gram to increase the Defense Department's contributions to coun-
tering major environmental threats facing the Nation and the
global environment.
The Committee supports the goals and genera! direction of this
initiative, but believes that it fails to address certain concerns cen-
tral to a balanced environmental protection and restoration effort.
These concerns include technical support for species conservation
activities on Defense Department lands and sufficient emphasis on
the development of renewable energy resources.
Consistent with the priorities described in the report accompany-
ing the Fiscal Year 1991 Defense Authorization Act establishing
the Strategic Environmental Research Program, the Committee
also believes that the issue of global environmental change is im-
portant to the mission of the SERP. To address this component of
the initiative, the Committee directs that $25,000,000 of the funds
appropriated for this initiative shall be available only for the estab-
lishment of an Arctic region supercomputing center to support re-
search by the Department of Defense and other Federal agencies
and the academic community.
The acquisition of one supercomputer, with ownership to be re-
tained by the Department of Defense, will commence this effort.
The new supercomputing center should be established at an insti-
tution engaged in Department of Defense research located within
the Arctic region. The supercomputing capabilities should be avail-
able to all qualified Federal and academic research activities en-
gaged in environmental studies.
The supercomputing center should also be available to support
other Department of Defense research initiatives, including the
possible exploitation of the auroral ionospheric electrojet for non-
polluting power generation.
The Committee expects the Joint Strategic Environmental Re-
search Program Council to report to the House and Senate Com-
mittees on Appropriations no later than March 15, 1991, on the
specific timetable and implementation plan to establish the Arctic
region supercomputing center. This report should address the ac-
278
"(1) To address environmental matters of concern to the De-
partment of Defense and the Department of Energy through
support for basic and applied research and development of tech-
nologies that can enhance the capabilities of the departments to
meet their environmental obligations.
"(2) To identify research, technologies, and other information
developed by the Department of Defense and the Department of
Energy for national defense purposes that would be useful to
governmental and private organizations involved in the devel-
opment of energy technologies and of technologies to address en-
vironmental restoration, waste minimization, hazardous waste
substitution, and other environmental concerns, and to share
such research, technologies, and other information with such
governmental and private organizations.
"(3) To furnish other governmental organizations and private
organizations with data, enhanced data collection capabilities,
and enhanced analytical capabilities for use by such organiza-
tions in the conduct of environmental research, including re-
search concerning global environmental change.
"(4) To identify technologies developed by the private sector
that are useful for Department of Defense and Department of
Energy defense activities concerning environmental restoration,
hazardous and solid waste minimization and prevention, haz-
ardous material substitution, and provide for the use of such
technologies in the conduct of such activities.
"$" 2902. Strategic Environmental Research and Development Pro-
gram Council
"(a) There is a Strategic Environmental Research and Develop-
ment Program Council (hereinafter in this chapter referred to as the
'Council').
"(b) The Council is composed of nine members as follows:
"(1) The Assistant Secretary of Defense responsible for mat-
ters relating to production and logistics.
"(2) The Director of Defense Research and Engineering.
"(3) The Vice Chairman of the Joint Chiefs of Staff.
"(4) The Assistant Secretary of the Air Force responsible for
matters relating to space.
"(5) The Assistant Secretary of Energy for Defense programs.
"(6) The Director of the Department of Energy Office of Envi-
ronmental Restoration and Waste Management.
"(7) The Director of the Department of Energy Office of
Energy Research.
"(8) The Administrator of the Environmental Protection
Agency.
"(9) The Executive Director of the Council (appointed pursu-
ant to section 2903 of this title), who shall be a nonvoting
member.
"(c) The Secretary of Defense shall designate a member of the
Council as chairman for each odd numbered fiscal year. The Secre-
tary of Energy shall designate (1 member of the Council as chairman
for each even-numbered fiscal year.
"(d) The Council shall have the following responsibilities:
6/Z
"(1) To prescribe policies and procedures to implement the
Strategic Environmental Research and Development Program.
"(2) To enter into contracts, grants, and other financial ar-
rangements, in accordance with other applicable law, to carry
out the purposes of the Strategic Environmental Research and
Development Program.
"(3) To prepare an annual five-year strategic environmental
research and development plan that shall cover the fiscal year
in which the plan is prepared and the four fiscal years follow-
ing such fiscal year.
"(4) To promote the maximum exchange of information, and
to minimize duplication, regarding environmentally related re-
search, development, and demonstration activities through close
coordination with the military departments and Defense Agen-
cies, the Department of Energy, the Environmental Protection
Agency, the National Oceanic and Atmospheric Administration,
the National Aeronautics and Space Administration, other de-
partments and agencies of the Federal Government or any State
and local governments, including the Federal Coordinating
Council on Science, Engineering, and Technology, and other or-
ganizations engaged in such activities.
"(5) To ensure that research and development activities under
the Strategic Environmental Research and Development Pro-
gram do not duplicate other ongoing activities sponsored by the
Department of Defense, the Department of Energy, the Environ-
mental Protection Agency, the National Oceanic and Atmos-
pheric Administration, the National Aeronautics and Space Ad-
ministration, or any other department or agency of the Federal
Government.
"(6) To ensure that the research and development programs
identified for support pursuant to policies and procedures pre-
scribed by the council utilize, to the maximum extent possible,
the talents, skills, and abilities residing at the Federal labora-
tories, including the Department of Energy multiprogram and
defense laboratories, the Department of Defense laboratories,
and Federal contract research centers. To utilize the research
capabilities of institutions of higher education and private in-
dustry to the extent practicable.
"(e) In carrying out subsection (d)(1), the Council shall prescribe
policies and procedures that-
"(1) provide for appropriate access by Federal Government
personnel, State and local government personnel, college and
university personnel, industry personnel, and the general public
to data under the control of, or otherwise available to, the De-
partment of Defense that is relevant to environmental matters
by-
"(A) identifying the sources of such data;
"(B) publicizing the availability and sources of such data
by appropriately-targeted dissemination of information to
such personnel and the general public, and by other means;
and
"(C) providing for review of classified data relevant to en-
vironmental matters with a view to declassifying or prepar-
ing unclassified summaries of such data;
280
"(2) provide governmental and nongovernmental entities with
analytic assistance, consistent with national defense missions,
including access to military platforms for sensor deployment
and access to computer capabilities, in order to facilitate envi-
ronmental research;
"(3) provide for the identification of energy technologies devel-
oped for national defense purposes (including electricity genera-
tion systems, energy storage systems, alternative fuels, biomass
energy technology, and applied materials technology) that might
have environmentally sound, energy efficient applications for
other programs of the Department of Defense and the Depart-
ment of Energy national security programs, particularly tech-
nologies that have the potential for industrial, commercial, and
other governmental applications, and to support programs of re-
search in and development of such applications;
"(4) provide for the identification and support of programs of
basic and applied research, development, and demonstration in
technologies useful-
"(A) to facilitate environmental compliance, remediation,
and restoration activities of the Department of Defense and
at Department of Energy defense facilities;
"(B) to minimize waste generation, including reduction at
the source, by such departments; or
"(C) to substitute use of nonhazardous, nontoxic, nonpol-
luting, and other environmentally sound materials and
substances for use of hazardous, toxic, and polluting mate-
rials and substances by such departments;
"(5) provide for the identification and support of research, de-
velopment, and application of other technologies developed for
national defense purposes which not only are directly useful for
programs, projects, and activities of such departments. but also
have useful applications for solutions to such national and
international environmental problems as climate change and
ozone depletion;
"(6) provide for the Secretary of Defense, the Secretary of
Energy. and the Administrator of the Environmental Protection
Agency, in cooperation with other Federal and State agencies,
as appropriate. to conduct joint research, development, and
demonstration projects relating to innovative technologies, man-
agement practices, and other approaches for purposes of-
"(A) preventing pollution from all sources;
"(B) minimizing hazardous and solid waste, including re-
cycling; and
"7C") treating hazardous and solid waste, including the
use of thermal. chemical, and biological treatment technol-
ogies;
"(7) encourage transfer of technologies referred to in clauses
(2) through (6) to the private sector under the Stevenson-Wydler
Technology Innovation Act of 1980 (15 U.S.C. 3701 et seq.) and
other applicable laws:
"(8) provide for the identification of, and planning for the
demonstration and use of. existing environmentally sound,
energy-efficient technologies developed by the private sector that
could be used directly by the Department of Defense;
281
"(9) provide for the identification of military specifications
that prevent or limit the use of environmentally beneficial tech-
nologies, materials, and substances in the performance of De-
partment of Defense contracts and recommend changes to such
specifications; and
"(10) to ensure that the research and development programs
identified for support pursuant to the policies and procedures
prescribed by the Council are closely coordinated with, and do
not duplicate, ongoing activities sponsored by the Department of
Defense, the Department of Energy, the Environmental Protec-
tion Agency, the National Aeronautics and Space Administra-
tion, the National Oceanic and Atmospheric Administration, or
other Federal agencies.
"(f)(1) To assist the Council in preparing the five-year strategic en-
vironmental research and development plan under subsection (d)(3),
the Secretary of Defense and the Secretary of Energy may each
submit to the Council a proposal for conducting environmental re-
search under this chapter. The Secretary of each department shall
ensure that the environmental research proposal of the department
includes-
"(A) short- and long-term, cooperative, basic, and applied re-
search systems engineering and development programs in envi-
ronmental research;
"(B) short- and long-term, basic research in environmental
restoration at the respective laboratories of each department;
and
"(C) participation by industry and institutions of higher edu-
cation.
"(2) The Secretary of each department shall ensure that, in the de-
velopment of its environmental research proposal, consideration is
given to-
"(A) the need for increased research in basic science, includ-
ing basic materials, physics, molecular structures, chemistry,
and biology related to environmental research at that Depart-
ment's defense operations, production, research, and mainte-
nance facilities; and
"(B) ways to identify and conduct research and development
on technologies for environmental restoration, remediation and
waste cleanup activities, waste minimization, and hazardous
and toxic materials substitution potential in defense production
and maintenance activities.
"(3) The Secretary of each department shall transmit the proposal
to the Council not later than July 1 of each year.
"(g) The Council shall be subject to the authority, direction, and
control of the Secretary of Defens in prescribing policies and proce-
dures under subsection (d)(1).
"(h)(1) Not later than February 1 of each year, the Council shali
submit to the Secretary of Defense an annual report on the annual
five-year strategic environmental research and development plan
prepared pursuant to subsection (d)(3).
"(2) The report shall contain the follow g:
"(A) A description of the actions to be taken during the five-
year period covered by the plan in order to prevent duplication
282
of research and development activities referred to in the policies
and procedures prescribed pursuant to subsection (d)(1).
"(B) A description of the involvement with Federal interagen-
cy coordinating entities such as the Federal Coordinating Coun-
cil on Science, Engineering, and Technology.
"(C) A description of each project selected or recommended by
the Council for support and funding, including the duration of,
and the total estimated or (if known) actual cost of-
"(i) each such project supported during the fiscal year in
which the plan is submitted and the preceding fiscal year;
and
"(ii) each such project proposed for funding during the
fiscal year in which the annual report is submitted and the
following four fiscal years.
"(D) The amounts requested, in the budget submitted to Con-
gress pursuant to section 1105(a) of title 31 for the fiscal year
following the fiscal year in which the annual report is submit-
ted, for the programs, projects, and activities of the Strategic
Environmental Research and Development Program and the es-
timated expenditures under such programs, projects, and activi-
ties during such following fiscal year.
"(E) The amount requested in such budget for each Federal
laboratory, including each Department of Defense and Depart-
ment of Energy laboratory.
"(F) The amount made available, for the fiscal year in which
the annual report is submitted, to each Federal laboratory, in-
cluding each Department of Defense and Department of Energy
laboratory.
"(G) A description of any changes in military specifications
recommended by the Council, actions to be taken to effectuate
any such recommended changes on an expedited basis, and the
projected date for each such change.
"(H) A description of all contracts, agreements. or other docu-
ments for cooperative research and development activities en-
tered into pursuant to the Stevenson- Wydler Technology Innova-
tion Act of 1980 (15 U.S.C. 3701 et seq.) during the fiscal year
preceding the fiscal year in which the annual report is submit-
ted.
"(I) Plans for transferring technology and information to
other governmental agencies and to nongovernmental organiza-
tions involved in environmental research and related matters.
"(J) A description of plans to increase access to data described
in subsection (e)(1).
"(K) Such additional recommendations or proposals, includ-
ing proposals for legislation, relating to the Strategic Environ-
mental Research and Development Program as the Council con-
siders appropriate.
"(3) The Council shall make a draft of the five-year strategic envi-
ronmental research and development plan covered by each report
available for public comment for a period of at least 30 days.
"(4) Not later than March 15 of each year the Secretary of Defense
and the Secretary of Energy shall transmit the annual report to the
Congress. The Secretary of Defense and the Secretary of Energy may
283
submit such comments on the annual report as each Secretary con-
siders appropriate.
"§ 2903. Executive Director
"(a) There shall be an Executive Director of the Council appointed
by the Secretary of Defense after consultation with the Secretary of
Energy.
"(b) Subject to the authority, direction, and control of the Secre-
tary of Defense, the Executive Director is responsible for the man-
agement of the Strategic Environmental Research and Development
Program in accordance with the policies established by the Council.
"(c) The Executive Director may enter into contracts or other
agreements in accordance with applicable law, except that the Exec-
utive Director shall first obtain the approval of the Council for any
contract or agreement in an amount equal to or in excess of $500,000
or such lesser amount as the Council may prescribe.
(d)(1) The Executive Director, with the concurrence of the Coun-
cil, may appoint such professional and clerical staff as may be nec-
essary to carry out the responsibilities and policies of the Council.
"(2) The Executive Director, with the concurrence of the Council
and without regard to the provisions of chapter 51 of title 5 and
subchapte." III of chapter 53 of such title, may establish the rates of
basic pay for professional, scientific, and technical employees ap-
pointed pursuant to paragraph (1). The authority provided in the
preceding sentence shall expire two years after the date of the enact-
ment of the National Defense Authorization Act for Fiscal Year
1991.
"§ 2904. Strategic Environmental Research and Development Pro-
gram Scientific Advisory Board
"(a) The Secretary of Defense and the Secretary of Energy, in con-
sultation with the Administrator of the Environmental Protection
Agency, shall jointly appoint a Strategic Environmental Research
and Development Program Scientific Advisory Board (hereafter in
this section referred to as the 'Advisory Board') consisting of not less
than six and not more than 13 members.
"(b)(1) The Science Advisor to the President, or his designee, shall
be a permanent member of the Advisory Board.
"(2) Other members of the Advisory Board shall be appointed
from among persons eminent in the fields of basic sciences, engineer-
ing, ocean and environmental sciences, education, research manage-
ment, international and security affairs, health physics, health sci-
ences, or social sciences, with due regard given to the equitable rep-
resentation of scientists and engineers who are women or who repre-
sent minority groups. At least one member of the Advisory Board
shall be a representative of environmental public interest groups
and one member shall be a representative of the interests of State
governments.
"(3) The Secretary of Defense and the Secretary of Energy, in con-
sultation with the Administrator of the Environmental Protection
Agency, shall request-
"(A) that the head of the National Academy of Sciences, in
consultation with the head of the National Academy of Engi-
neering and the head of the Institutes of Medicine of the Na-
284
tional Academy of Sciences, nominate persons for appointment
to the Advisory Board;
"(B) that the Council on Environmental Quality nominate for
appointment to the Advisory Board at least one person who is a
representative of environmental public interest groups; and
"(C) that the National Association of Governors nominate for
appointment to the Advisory Board at least one person who is
representative of the interests of State governments.
"(4) Members of the Advisory Board shall be appointed for terms
of three years.
"(c) A member of the Advisory Board who is not otherwise em-
ployed by the Federal Government shall not be considered to be a
Federal employee, except for the purposes of chapter 81 of title 5 (re-
lating to compensation for work-related injuries) and chapter 171 of
title 28 (relating to tort claims).
"(d) The Advisory Board shall prescribe procedures for carrying
out its responsibilities. Such procedures shall define a quorum as a
majority of the members, provide for annual election of the Chair-
man by the members of the Advisory Board. and require at least
four meetings of the Advisory Board each year.
"(e) The Council shall refer to the Advisory Board, and the Advi-
sory Board shall review, each proposed research project including its
estimated cost. for research in and development of technologies re-
lated to environmental activities in excess of $1,000,000. The Adviso-
ry Board shall make any recommendations to the Council that the
Advisory Board considers appropriate regarding such project or pro-
posal.
"(f) The Advisory Board may make recommendations to the Coun-
cil regarding technologies, research. projects, programs, activities,
and, if appropriate. funding within the scope of the Strategic Envi-
ronmental Research and Development Program.
"(g) The Advisory Board shall assist and advise the Council in
identifying the environmental data and analytical assistance activi-
ties that should be covered by the policies and procedures prescribed
pursuant to section 2902(d)(1) of this title.
"(h) Not later than March 15 of each year, the Advisory Board
shall submit to the Congress an annual report setting forth its ac-
tions during the year preceding the year in which the report is sub-
mitted and any recommendations, including recommendations on
projects, programs, and information exchange and recommendations
for legislation, that the Advisory Board considers appropriate re-
garding the Strategic Environmental Research and Development
Program.
"(i) Each member of the Advisory Board shull be required to file
(1 financial disclosure report under title I of the Ethics in Govern-
ment Act of 1978 (5 U.S.C. App.)."
(2) The tables of chapters at the beginning of subtitle A of title 10,
United States Code, and at the beginning of part IV of such sub-
title, are each amended by inserting after the item relating to chap-
ter 171 the following:
"172 Strategic Environmental Research and Development Program
2901".
(b) INITIAL APPOINTMENTS OF ADVISORY BOARD MEMBERS.
The Secretary of Defense and the Secretary of Energy shall make
285
the appointments required by section 2904(a) of title 10, United
States Code (as added by subsection (a)(1)), not later than 60 days
after the date of the enactment of this Act.
(2) Up to one-half of the members originally appointed to the Stra-
tegic Environmental Research and Development Program Scientific
Advisory Board established under section 2904 of title 10, United
States Code, as added by subsection (a)(1), may be appointed for
terms of not more than six and not less than two years in order to
provide for staggered expiration of the terms of members. The Secre-
tary of Defense and the Secretary of Energy, in consultation with
the Administrator of the Environmental Protection Agency, shall
designate the members appointed for terms authorized under this
paragraph and shall specify the terms for which such members are
appointed.
(c) FIRST ANNUAL REPORT OF THE STRATEGIC ENVIRONMENTAL
RESEARCH AND DEVELOPMENT PROGRAM COUNCIL.-(1) The first
annual report required by section 2902(h) of title 10, United States
Code, as added by subsection (a)(1), shall be submitted to the Secre-
tary of Defense, the Secretary of Energy, and the Administrator of
the Environmental Protection Agency not later than February 1,
1992.
(2) The Strategic Environmental Research and Development Pro-
gram Council shall conduct and include as part of the first annual
report required pursuant to section 2902(h) of title 10, United States
Code, as added by subsection (a)(1), an assessment of the advisabil-
ity of, and various alternatives to, charging fees for information re-
leased, as required pursuant to sections 2901(b)(3), 2902(e) (1) and (2),
and 2902(g)(2)(2) of such title (as so added), to private sector entities
operating for a profit.
(3) The Secretary of Defense, the Secretary of Energy, and the Ad-
ministrator of the Environmental Protection Agency shall submit to
the Congress, with the annual report referred to in paragraph (1),
any recommendations for changes in the structure or personnel of
the Council that the Secretaries and the Administrator consider nec-
essary to carry out the environmental activities of the strategic envi-
ronmental research and development program.
(d) FIRST ANNUAL REPORT OF THE STRATEGIC ENVIRONMENTAL
RESEARCH AND DEVELOPMENT PROGRAM SCIENTIFIC ADVISORY
BOARD.--The first annual report of the Strategic Environmental Re-
search and Development Program Scientific Advisory Board re-
quired by section 2904(h) of title 10, United States Code, as added by
subsection (a)(1), shall be submitted not later than March 15, 1992.
SEC. 1802. AVAILABILITY OF FUNDS
Of the amounts authorized to be appropriated pursuant to section
201. $200,000,000 shall be available for the Strategic Environmental
Research and Development Program established under chapter 172
of title 10. United States Code, as added by section 1001. To the
extent provided in appropriation Acts. the amount made available
by this section shall remain available until expended.
Assistant to the President for
Science and Technology
Chairman,
Chairman,
Federal Coordinating
Director,
President's Adviser on
Committee on Science,
Office of Science and
Science & Technology
Engineering & Technology
Technology Policy (OSTP)
(PCAST)
(FCCSET)
(private sector panel)
(Interagency council)
Committee on
Associate Director for
Physical, Mathematical
Life Sciences
Engineering Sciences
Committee on
Associate Director for
Sciences
Industrial Technology
Earth and Environment
Committee on
Associate Director for
Life Science and Health
Policy and
International Affairs
Committee on
International Science,
Engineering and
Technology
Committee on
Associate Director for
Education and
Physical Science and
Human Resources
Engineering
Committee on
Assistant Director for
Radiation Research and
National Security
Policy Coordination
Committee on
Assistant Director for
Industry and Technology
Environment
MAJOR OSTP ISSUES AND ACTIVITIES 1989-1990
Develop High Performance Computing Initiative
Participate in Federal Budget Process on R&D
Coordinate Administration's Scientific Work on Global
Climate Change
Formulate Math/Science Education Goals of Agencies with
respect to R&D
Establish FCCSET Structure
PROPOSED AGENDA FOR S&T WORKING GROUP
Review Pending Legislation on Technology Policy
American Technology Preeminence Act
High Performance Computing Initiative
Prospective Critical Technologies Legislation
Develop Guidelines Regarding Industry/Government Cost
Sharing and Joint R&D
Initial focus: electric car consortium in the National
Energy Strategy
Develop Plan for the National Critical Technologies
Institute
Develop position on Uruguay Round disciplines on Government
support for R&D (perhaps better suited as TPRG issue)
Document Originally
Attached to
Following Page
DEPARTMENT OF COMMERCE
Assistant Secretary
UNITED STATES of
for Technology Policy
DATE: March 20, 1991
FROM THE DESK OF:
Deborah L. Wince-Smith
TO: Olin Wethington
Per our conversation.
X
For your information.
For appropriate action.
For draft of an appropriate reply for
my signature.
Please answer directly.
Let's discuss.
Please return with your comments.
Attached is the CISET I.P.R. papers. These
have been approved by the CISET, however the
attorneys are now reviewing them for final
approval.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
01a. Memo
Working Group on Intellectual Property Rights (IPR) to
2/25/91
(b)(1)
Committee on International Science, Engineering and
Technology (CISET)
Re: An Alternative Intellictual Property Allocation Provision
for Use with Institutions of the European Community and
Member Sta (2 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
01b. Report
Re: An Alternative Intellectual Property Allocation Provision
n.d.
(b)(1)
for Use with Institutions of the European Community and
Member States (2 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
01c. Attachment
Re: Joint Management Allocation Provision (1 pp.)
n.d.
(b)(1)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
01d. Attachment
Re: Standard IPR Annex (3 pp.)
n.d.
(b)(1)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
AGENDA FOR MEETING OF THE
INTERAGENCY COMMITTEE FOR FEDERAL TECHNOLOGY TRANSFER
April 2, 1991 at 10:00 a.m.
ROOM 4830, DEPARTMENT OF COMMERCE
Agenda
Opening remarks
-Deborah Wince-Smith, Assistant Secretary for
Technology Policy, Department of Commerce
Discussion of important technology transfer issues
under consideration by the Committee on Industry and
Technology of the Federal Coordinating Council for
Science, Engineering and Technology
--Dr. William Phillips, Associate Director for
Industrial Technology, Office of Science and
Technology Policy, the White House
Discussion of proposed changes in GATT Subsidy Code
(possible countervailing duties on products from labs)
and Procurement Code (opening government contracts to
international competition)
FCCSBT Com't on Industry sted. Wm.Phillips
misson: enhance applie offed. R+D taindursting thrust is to mike more unseful to industry
strategy: Attam put south addreal nouth for Herh spring
mimplem of
older hirtial Teah Report
advities: x-at on administ materials processing
mentines/cation technologies
there inventing are mini-xcuts
advanced many
barder existing OMB inventory
7 advanced ofthave
- ifo + communition hardware
- biotechnology
Dill Phollips: "undear how for
can take this"
identify arrad greater applie. of fed. R&D
confirence M provato section
D. W.S: how get industry they R&D
issue bring is who lasign/provess uses tech. into first, fed Not R.D who creater if
Computition Comil
conflist implio. of of FOIA interest *** tech nes) transfer no miform no policy remove on comf. comflie of of asan interest impediment
how implement initiatives (eg.
-2-
I want to thank you for the information on your agency's
technology transfer activities that you provided for the
Secretary's biennial report to the President and Congress.
Please bring any additional recommendations for ideas that you
want included in the report.
I look forward to seeing you and hearing your views on these
important issues. Please RSVP to Regina Horton at 202-377-8100.
Sincerely,
Deborah L.Winee Smith
Deborah L. Wince-Smith
Enclosure
Goût R+D under GATT Subsidies Code/UruguaryR.
put gou't R&D in green gone ?
how draw line between permissible & impermissible ?
should gov't R&D contracts go under procurement cote ?
V.S. counter: services contracts (with resiprocity)
EC Ay 90 offer: expand P.d.to
TPRG qun notgrovide explaintiments to indude R&D
signifexclusion in
hall offer scounty
TPRG to
issue of coverageof sub national entities (og states) and
MASA(?) teams
non-gottenties (reginal teleas/prionto utilities)
problem I J. shadm/abs
HHS research grant to universities. not New open to froign to
GATT govt gres code will Not cover grants
BERRTHENT OF COMMERCE
UNITED STATES DEPARTMENT OF COMMERCE
The Assistant Secretary for Technology Policy
UNITED STATES OF AMERICA
Washington, D.C. 20230
MAR 21 1991
Mr. Olin Wethington
Special Assistant to the President
and Executive Secretary of the Economic
Policy Council
Room 228, Old Executive Office Building
Washington, D.C. 20500
Dear Mr. Wethington:
This is to invite you to the first 1991 meeting of the
Interagency Committee for Federal Technology Transfer. The
meeting will be held on April 2, at 10:00 a.m. in room 4830 of
the Department of Commerce. An agenda is attached.
As you know, this Committee was established to expedite the
transfer and commercialization of technology from Federal
laboratories under the Federal Technology Transfer Act of 1986.
However, as the Administration expanded its attention to
technology commercialization, it has become apparent that there
are many related issues that should be reviewed. Several of
these will be considered at this meeting.
After my introductory remarks, Dr. William Phillips of the
White House's Office of Science and Technology Policy will
discuss issues on the agenda of the new Committee on Industry and
Technology of the Federal Coordinating Council on Science,
Engineering, and Technology (FCCSET/CIT). Our committee will be
working closely with both the FCCSET/CIT and the President's
Council on Competitiveness Working Group on the Commercialization
of Government R&D.
Two issues of immediate importance to our commercialization
efforts relate to the ongoing GATT negotiations. In the
Subsidies Code negotiations, there is a proposal to treat
government support for R&D which ultimately produces a commercial
product as potentially subject to countervailing duties. In the
Procurement Code negotiations, the United States is considering
whether to include government R&D contracts as procurement within
the Code, opening them to international competition. Both of
these issues are on a fast track and it is important that you
take this opportunity to hear from our trade officials on these
sensitive issues and to provide your agency's views to them.
Although this committee and its working group have already
considered a number of issues related to federal technology
transfer, some barriers to commercialization remain. In order to
further stimulate your thinking on this subject, I am enclosing a
paper prepared by the Federal Laboratory Consortium that presents
a brief discussion of issues that laboratory technology managers
believe still need resolution at the policy level.
April 2, 1991
Name
Agency
Phone
Tom BUCKHOLTZ
GSA
501-1000
JOHN COHRSSEN
OVP
456-2816
Nick Montanarelli
SDIO
653-1442
Sidney L. Jones
Treasury
566-2551
Edward Murphy
Treasury
566-5755
Richard Shane
SBA
205-6450
JACK SWEENEY
SBA
205-6950
Peter Saba
DOE
586-4159
HENRY SANTIAGO
DOE
586-6143
DAVID MORRISSY
USTR
395-4947
Ted Jorei (for Stere Leturn)
VA
535-7181
OlinWethington
WH
456-7968
Wayne Leiss
OFPP
395-3501
Ron Culpepper
Navy
703-676-4448
MICHAEL MOORE
EPA
382-7671
RAY BOWEN
NSF
357-7717
DAVID APPLER
DoD
703 614-0205
DAN RAK
USAF
703 614-8000
NASA
453-8440
Richard DulBello
NASA
453-8185
H Emzer
Interior
208-5791
BEUErly Berger
FLC
331-4220
Jean Kemp
Commerce/IA
377-1780
Ron Lorentzen
n
n
377-4412
Tom Duesterberg
DOC /IEP
377-301.1
Mark Gebeman
POC
377-4625
SALLY H. BATH
ITH/TD/AERO
377-4222
DAVID FLORIO
219.1385
Daphne Kamely
U.S.ARMY SARD-TR
703-697-8432
Bill Tallent
USDA/ARS
202-447-3973
Cherri Langenfeld
DOE
586-3873
Judy Rosovich
DOE
586-6399
John Pfeiffer
OMB
395-4706
10:35
file: Technlogy
EMERGING TECHNOLOGIES
A Survey of Technical and Economic Opportunities
Technology Administration
U.S. Department of Commerce
Spring 1990
DEPARTMENT OF COMMERCE
*
*
UNITED STATES OF AMERICA
EMERGING TECHNOLOGIES
A Survey of Technical and Economic Opportunities
Technology Administration
U.S. Department of Commerce
Spring 1990
CONTENTS
page
FOREWORD
iii
EXECUTIVE SUMMARY
V
Emerging Technologies and Markets
vii
U.S. versus Japan and the EC
ix
U.S. Report Card: Status 1989
xi
U.S. Report Card: Trends
xiii
Opportunities for Government Leadership
XV
Opportunities for Government-Industry Coordination
xvii
Opportunities for Industry-Government Cooperation
xix
Opportunities for Industry Leadership Facilitated by the Government
xxi
REPORT ON EMERGING TECHNOLOGIES; A SURVEY OF TECHNICAL
AND ECONOMIC OPPORTUNITIES
1
1. Purpose of the Report
3
2. Economic Importance of Emerging Technologies
5
3. The Emerging Technologies.
7
4. Emerging Technologies in the International Context
11
5. Opportunities for Change
15
6. Outlook
25
APPENDICES
27
A Detailed List of Emerging Technologies
29
B Comparison of the 1989 and 1987 DOC Emerging Technologies Reports
43
C Comparison of the Emerging Technologies with the Critical Technologies
of the Department of Defense
45
D National Security Concerns
47
E Investment in R&D and Consortia by Japan, EC and U.S.
49
F Comparison of Industry Growth Rates
51
G Bibliography
53
LIST OF TABLES
Table 1. The Emerging Technologies
9
Table 2. Past versus Present: The New Environment for Emerging
Technologies
12
Table 3. Relative Standing in Emerging Technologies:
U.S. versus Japan and EC
13
Table 4. Comparison of Emerging Technology Categories:
Japan, EC and U.S.
14
Table 5. Opportunities for Change
15
I
FOREWORD
Emerging technologies have the potential to create a multitude of new products and
services and to substantially advance productivity and quality. This report identifies 12
emerging technologies in four major categories that feature a combined U.S. market poten-
tial of about $350 billion in annual product sales by the year 2000 and a world market
approaching $1 trillion. If the United States takes maximum advantage of this economic
potential of emerging technologies, further growth in the U.S. standard of living should
result.
However, competition from the world's other two economic power centers, Japan
and the European Community (EC), is strong. If current trends continue, this study indi-
cates that, before the year 2000, the United States could lag behind Japan in most emerging
technologies and trail the EC in several of them.
Based on knowledge of U.S. industry and overseas efforts, this report identifies 13
areas of opportunity for enhancing the likelihood of U.S. success in international competi-
tion. Changes and actions in these and other areas could improve the climate for economic
development of all emerging technologies, including future additions from the U.S. science
base.
The purpose of this report is to provide a source of information to be used by industry,
labor, government and academe as programs and policies are developed to exploit new,
emerging technologies. The report is not intended to set out a limited set of technologies
which the government has pre-selected for support. Rather, it reflects the new interna-
tional science and technology community's agenda of promising fields with large potential
economic impact.
I believe that the information this report contains will facilitate a continuing dialogue
in order to maximize the benefits that we can derive, as a nation, from the opportunities
offered by emerging technologies. The goals of such dialogue are refined views, additional
information, and - most importantly - consensus on what is worth doing and what are the
appropriate roles for industry, government, labor and academe. Assuring U.S. industries'
global competitiveness is foremost among the benefits that would accrue from exploiting
emerging technologies. In turn, our economic security is a prerequisite for a strong U.S.
defense posture and for maintaining and advancing the well-being of every citizen. I en-
courage your comments and suggestions on this important topic.
Rhus
Robert A. Mosbacher
Secretary of Commerce
iii
EXECUTIVE SUMMARY
This report identifies 12 emerging technologies that feature a combined U.S. market
potential of $356 billion in annual product sales by the year 2000. The report discusses
competition from the world's other two economic power centers, Japan and the European
Community (EC). This study indicates that, if current trends continue, before the year
2000, the United States will lag behind Japan in most emerging technologies and will trail
the EC in several of them.
Based on contacts with U.S. industry and information about activities abroad, this
report identifies 13 areas of opportunity for improving the climate for economic develop-
ment of all emerging technologies. The purpose of this report is that of an information base
to facilitate discussions between industry, government, labor and academia. In this role, the
report should be viewed as a living document subject to revision, updates and expanded
coverage, moving along with the process of national consensus formation.
The following figures summarize the content of this document:
Emerging Technologies and Markets is a tabulation of the emerging technologies
together with their market potential. Twelve technologies are covered because they offer
substantial economic benefits for U.S. industry by the year 2000. They are grouped into
four major categories: Materials, Electronics and Information Systems, Manufacturing
Systems, and Life Sciences Applications. The potential product markets are depicted in
bar-graph-format: Annual sales in the U.S. market by the year 2000.
Source: Technical knowledge of staff of the U.S. Department of Commerce, in particular scientists and engi-
neers of the National Institute of Standards and Technology; based on interviews with U.S. international
science, engineering, and industrial experts.
U.S. Versus Japan and the European Community depicts the current standing and
the trends observed for the major categories of emerging technologies. Trend lines show
the comparison to the world's other great economic powers; the horizontal dividing line
indicates parity. Concern about the U.S. position increases with the steepness of the drop
of a trend line. The two associated tables entitled U.S. Report Card give a more detailed
view of current status and trends in world competition for all 12 emerging technologies.
Source: Compiled from the knowledge residing within the Department of Commerce, mostly from contribu-
tors within the National Institute of Standards and Technology and the International Trade Administration.
The four groupings of Opportunities tabulate 13 areas where actions could be de-
fined and implemented toward improving the climate and capabilities for competitive eco-
nomic development of all emerging technologies; these 13 areas are not meant to be
comprehensive. The four groupings reflect varying degrees of government-industry inter-
action.
Source: Compiled from the knowledge residing within the Department of Commerce.
V
EMERGING TECHNOLOGIES AND MARKETS
Annual Sales of $356 Billion in the U.S. by the Year 2000
$1B
$10B
$100B
EMERGING MATERIALS
Advanced Materials
150
Superconductors
5
EMERGING ELECTRONICS AND
INFORMATION SYSTEMS
Advanced Semiconductor Devices
75
Digital Imaging Technology
4
vii
High-Density Data Storage
15
High-Performance Computing
50
Optoelectronics
4
EMERGING MANUFACTURING
SYSTEMS
Artificial Intelligence
5
Flexible Computer-Integrated
20
Manufacturing
Sensor Technology
5
EMERGING LIFE-SCIENCES
APPLICATIONS
Biotechnology
15
Medical Devices and
8
Diagnostics
U.S. VERSUS JAPAN AND THE EC
U.S. Ahead
U.S. Ahead
Past
NOW
Future
Past
NOW
Future
1980's
1990's
1980's
1990's
Emerging
Electronics and
Emerging
U.S. vs. Japan
U.S. vs. EC
Information
Materials
U.S. Behind
U.S. Behind
Systems
ix
R&D
R&D
New Products
New Products
U.S. Ahead
U.S. Ahead
Past
NOW
Future
Past
NOW
Future
1980's
1990's
1980's
1990's
Emerging
Emerging Life -
Manufacturing
Sciences
Systems
U.S. Behind
U.S. Behind
Applications
U.S. REPORT CARD: STATUS 1989
Versus Japan
Versus Europe
Advanced Materials
Advanced Semiconductor Devices
Behind
Digital Imaging Technology
Digital Imaging Technology
High-Density Data Storage
Optoelectronics
Flexible Computer-
Even
Superconductors
Integrated Manufacturing
Superconductors
Artificial Intelligence
Advanced Materials
Biotechnology
Advanced Semiconductor Devices
Flexible Computer-
Artificial Intelligence
Integrated Manufacturing
Ahead
Biotechnology
High-Performance Computing
High-Density Data Storage
Medical Devices and Diagnostics
High-Performance Computing
Sensor Technology
Medical Devices and Diagnostics
Optoelectronics
Sensor Technology
U.S. REPORT CARD: TRENDS
Versus Japan
Versus Europe
Advanced Materials
Digital Imaging Technology
Losing Badly
Biotechnology
Flexible Computer-
Digital Imaging Technology
Integrated Manufacturing
Superconductors
Advanced Semiconductor Devices
High-Density Data Storage
High-Performance Computing
xiii
Losing
Medical Devices and Diagnostics
Medical Devices and Diagnostics
Optoelectronics
Sensor Technology
Advanced Materials
Advanced Semiconductor Devices
Artificial Intelligence
Holding
High-Density Data Storage
Flexible Computer-
Optoelectronics
Integrated Manufacturing
Sensor Technology
Superconductors
Artificial Intelligence
Gaining
Biotechnology
High-Performance Computing
OPPORTUNITIES FOR GOVERNMENT LEADERSHIP
THE COST OF RESEARCH AND MARKET INTRODUCTION
The Cost of Capital Determines the Business Horizon Especially for the Introduction of New Technology
National Savings Rate
Federal Budget
Tax Laws
EXPORT POLICY
New Technologies Are the Strongest Assurance for Maintaining a Superior National Security Posture
Speed of Approval Process
Foreign Availability of Similar Products
AX
Re-Export Controls
REGULATORY CONSTRAINTS
New Products Require Evaluations of Their Impact on Health, Safety and Environment That Are Often Lengthy
and Costly
Streamlining Procedures and Harnessing Market Incentives
Proper Balance of Protection Versus Economics
Large Differences in Requirements Between Countries
LAWS OF PRODUCT LIABILITY
New Technologies and New Uses Create High Risks as Regards the Degree of Liability Exposure
Limited Versus Unlimited Exposure
Court Versus Out-of-Court Pathways
Multiplicity of Laws Here and Abroad
OPPORTUNITIES FOR GOVERNMENT-INDUSTRY COORDINATION
ENGINEERING TRAINING AND EDUCATION
Technology Requires Special Skills To Assure High Quality, Low Cost and Competitively Timed Market Entry
Design Engineering
Manufacturing Engineering
Technology Management
RESTRICTIVE FOREIGN TRADE PRACTICES
To Varying Degrees, Countries Protect Their Home Market From Foreign Products
Entry Barriers such as Tariffs and Licenses
xvii
Domestic Content and Preferential Buy Requirements
Disregard for Intellectual Property and Non-Symmetrical Access to R&D
PROTECTING INTELLECTUAL PROPERTY RIGHTS
Businesses Rely on Intellectual Property Protection To Capture the Economic Benefits From Innovation
Extended Duration of Protection Periods
Adapt Protection to New Technologies
International Incoherence of Rights and Rules
OPPORTUNITIES FOR INDUSTRY-GOVERNMENT COOPERATION
IMPROVING THE TECHNOLOGY INFRASTRUCTURE
Efficiency in the Use of Technology Depends on the Availability of Generic Know-How, Information and Facilities
Government Participation in Industrial Consortia
Availability of Methods, References and Data
Industry Access to Government Facilities
PRODUCT AND INTERFACE STANDARDS
International Standardization Provides Equity Between Buyers and Sellers in Different Countries
Industry and Government Participation in Standards Committees
U.S. Leadership in International Committees
Promote International Consideration of U.S. Technical Advances
DEPENDENCE ON DOMESTIC TECHNOLOGIES AND MARKETS
The Size and Accessibility of the U.S. Market Make It Appear Like It is "The World"
Rise to Product Challenges From Abroad
Enhance Export Opportunities
Put to Use Technology and Innovation From Abroad
OPPORTUNITIES FOR INDUSTRY LEADERSHIP
FACILITATED BY THE GOVERNMENT
IMPROVING THE QUALITY OF PRODUCTS AND SERVICES
Quality Has Become a Primary Factor in Global Competition
Product Characteristics
Customer Expectations
Quality Through Process Design
INTEGRATION OF R&D, DESIGN AND MANUFACTURING
Organizational Integration Speeds Up Product Introduction, Lowers Its Cost, Improves Its Quality
Market Strategy
xxi
Team Work and Process Orientation
Computer (Information) Integration
INDUSTRIAL COOPERATION
Cooperation Between Firms Can Reduce Risks and Costs
Shared Facilities and Projects
Antitrust Legislation
Vertical Linkages and Integration
Report on
EMERGING TECHNOLOGIES
A Survey of Technical and Economic Opportunities
1. Purpose of the Report
For most of the period following World War II, the United States was dominant
internationally and nearly self-sufficient in science and technology. Our university, indus-
try, and government laboratories were the sources of the ideas for new products and
processes which were produced by American factories using American workers and
equipment and financed by American investors. Although in some instances U.S.-based
multinational corporations operated overseas, this was generally to be close to raw materi-
als or markets and to take advantage of lower labor costs. Products generally were based
on technologies developed in the United States.
This dominance has eroded in recent years, and U.S. supremacy has been challenged.
Many other countries have attained world-class capabilities in critical technologies and
have focused on the timely commercialization of high-quality, cost-efficient products in
the international marketplace. Many foreign governments have used subsidies and various
other mechanisms to encourage development of specific advanced technologies and their
commercial applications.
To remain competitive in this rapidly evolving international economic community,
U.S. industry must match these developments by increasing emphasis on research and
development of new products and emerging technologies and then on product commer-
cialization and market share.
The purpose of this report is to provide a source of information to be used by industry,
government and academia as programs and policies are developed to exploit new, emerg-
ing technologies. The report is not intended to set out a limited set of technologies which
the government has pre-selected for support. Rather, it reflects the new international sci-
ence and technology community's agenda of promising fields with large potential eco-
nomic impact. It provides (1) a list and brief description of emerging technologies
anticipated to be of major economic importance by the year 2000; (2) a comparison of
these technologies with those considered important by major international competitors;
and (3) an outline of some opportunities for policies, practices, and procedures that would
help U.S. industry to introduce and gain market share from emerging technologies more
effectively. Specific recommendations for improvements can result only from extensive
deliberations involving industry, academia, labor, and government. However, it is hoped
that this document constitutes at least a partial agenda for further discussions.
3
2. Economic Importance of Emerging Technologies
For purposes of this report, emerging technologies are broadly defined as follows:
An emerging technology is one in which research has progressed far enough to indicate
a high probability of technical success for new products and applications that might
have substantial markets within approximately 10 years.
In large developed economies such as the United States, economic growth requires
that a substantial number of emerging technologies be under development simultaneously
to diversify risk and broaden the future industrial base. Just as a mutual fund manager
diversifies risk through a large portfolio of investments (expecting some failures), a country
with a large diversified economy ought to take advantage of a large science base and rich
technological resources to pursue development of as many emerging technologies as possi-
ble; this would assure maximum flexibility to capture the economic benefits from those
technologies which eventually prove successful in the global marketplace.
This portfolio approach is a very different concept from the "targeted industry" strat-
egy of some countries. In this approach, a few technologies or industries are singled out for
intensive government support. Such a strategy might be appropriate for a developing
country with limited technological resources, but it is probably not desirable for the United
States.
Industry and government strategies for developing and exploiting emerging technolo-
gies depend to a great extent on assessments of the nature and magnitude of their economic
potential. Emerging technologies must be viewed as having the potential to either
create new products and industries with markets of substantial size, or
provide large advances in productivity or in the quality of products produced by
existing industries which supply large, important markets.
Some emerging technologies-usually self-contained products, such as new
medicines, or processes, such as x-ray lithography have important but focused impacts.
Others substantially affect the economy by advancing the technical infrastructure or by
improving the quality and efficiency of the manufacturing process. Examples are compo-
nents of a computer-integrated manufacturing system, such as robots or machining centers
or the factory control system itself.
Emerging technologies are also important because they will drive the next generation
of R&D and spin-off applications. When an industry uses a new technology to design or
improve a product and successfully carries it to the commercial marketplace, that new or
improved product becomes the starting point for development of the next generation of
products or services. Hence, leadership in an emerging technology provides the basis to
become a major player in developing or commercializing successive generations of break-
throughs in that or a related technology.
5
In addition to their economic impact, their influence on next-stage technology and
their relevance to national defense (Appendix C and D), emerging technologies affect
social and political systems. Advances in computers and communications, for example, are
changing work practices and the work environment itself; the removal of geographical
limitations on work locations and the increased capability for communicating large quanti-
ties of information have affected social and political behavior.
6
3. The Emerging Technologies
Emerging technologies expected to be of economic importance by the year 2000 are
listed in table 1. A more detailed explanation of what these technologies encompass, how
they are rooted in science, and how they affect the markets is presented in Appendix A.
Their potential impact on national defense is also presented in Appendix A by cross refer-
ence to the 1989 DOD Critical Technologies Plan and summarized in Appendix C. Market
estimates are solely intended to provide rough guidance and to indicate current perception
of economic potential.
The list of emerging technologies was generated using published material (see list of
References), knowledge residing within the Department of Commerce which reflects
strong interactions with U.S. industry and the international scientific and technical com-
munity, and extensive iteration involving the many technical experts contributing to this
report. The selected emerging technologies cover the full range from post-basic-research
to post-early-commercialization. All entries are projected to have substantial economic
impact and to exhibit rapid rates of technical progress. A comparison of this list to the 1987
report of the Department of Commerce¹ is given in Appendix B.
These 12 emerging technologies can be aggregated² into four major categories:
Emerging Materials
Emerging Electronics and Information Systems
Emerging Manufacturing Systems
Emerging Life Sciences Applications
Technologies in these four categories are likely to have not only substantial economic
impact but also very large indirect infrastructure and social impact. Many also will have
substantial national security impact. Furthermore, they each affect several industry sectors
and a multitude of products, processes, and services.³ Finally, it must be noted that three of
these categories already are being aggressively pursued by Japan and Europe (see table 4)
with ambitious proposals to establish extensive programs in the fourth (Manufacturing
Systems).
1 National Bureau of Standards Internal Report 87-3671, June 1987.
2 Several of these emerging technologies support more than one category; they were listed where they likely
will make their primary beneficial contributions.
3 Most of the emerging technologies are also dependent on each other. For example, advances in materials,
semiconductor devices, and computing affect nearly all of the other emerging technologies.
7
The emerging technologies of table 1 represent only a subset of all the critical and
important technologies. Technologies that are still just scientific opportunities were not
listed; also excluded were technologies which have already fully entered the marketplace.
An example of the former is Nanotechnology. Although molecular manipulation, nano-
lithography, and molecular electronics offer exciting prospects for extremely dense elec-
tronics, custom-designed materials, and novel pharmaceuticals, unresolved scientific
questions make market development by the year 2000 extremely unlikely.
Among the important technologies with a well-established market are those expected
to expand and/or restructure by the year 2000. These technologies will benefit not only
from some of the emerging technologies but also, significantly, from the introduction of
well-known technologies in use elsewhere. For these reasons, they are summarized below:
Building Technology: Major development is now occurring in the areas of flexible and
modular manufacturing, intelligent buildings, facilities diagnostics, construction quality
assurance, use of new materials, and earthquake and geotechnical engineering. Buildings
and other facilities are being equipped with sensors, data processors and actuators to mon-
itor the environment and provide security, safety, air quality, thermal and lighting control,
and dynamic structural response.
Chemical Catalysis Technology: Approximately 20 percent of the U.S. gross national
product is generated through the use of catalytic processes. Continuing development of
catalysts with improved reactivity, selectivity, and stability will permit the manufacture of
new materials, reduce the cost of existing products, and increase yields. Significant ad-
vances are occurring in the areas of computer modeling of complex catalytic reactions,
creation of catalysis designed at the molecular level, and highly specific catalysis that
produces few undesirable reactions.
Energy Technology: Environmentally acceptable and economically viable generation,
control and transmission of electric power is a prerequisite for a technology-based society.
New insulating materials, advanced instrumentation and sensors as well as modern com-
puting and communication technologies will help assure efficient and reliable transmission
systems. The depletion of resources, dependence on oil imports, and world environmental
concerns (greenhouse effect) will be strong incentives towards the realization of both clean
and ultra-safe nuclear power generation which will require full use of existing technolo-
gies, many of the emerging technologies, and the development of new standards.
Fire Safety Technology: Significant advances have been made in the area of polymer
thermal degradation, advanced sensing and extinguishment techniques, and risk prediction,
management, and control. These new abilities to predict and prevent fires cost-effectively
have potentially very favorable economic and competitive consequences for a wide array
of industries including not only the construction industry but also transportation, aircraft,
plants and facilities.
8
Table 1. The Emerging Technologies
EMERGING TECHNOLOGY
MAJOR TECHNOLOGY ELEMENTS
Emerging Materials
Advanced Materials
Structural and Functional Ceramics, Ceramic
and Metal Matrix Composites, Intermetallic
and Lightweight Alloys, Advanced Polymers,
Surface-Modified Materials, Diamond Thin Films,
Membranes, Biomaterials
Superconductors
High-Temperature Ceramic Conductors,
Advanced Low-Temperature Conductors
Emerging Electronics and Information Systems
Advanced Semiconductor Devices
Silicon, Compound Semiconductors (GaAs),
ULSI, Memory Chips, X-ray Lithography
Digital Imaging Technology
High Definition Systems, HDTV, Large Displays,
Data Compression, Image Processing
High-Density Data Storage
High-Density Magnetic Storage,
Magneto-Optical Storage
High-Performance Computing
Modular/Transportable Software,
Numerical Simulation, Neural Networks
Optoelectronics
Integrated Optical Circuitry, Optical Fibers,
Optical Computing, Solid-State Lasers,
Optical Sensors
Emerging Manufacturing Systems
Artificial Intelligence
Intelligent Machines, Intelligent Processing
of Materials and Chemicals, Expert Systems
Flexible Computer-Integrated
CAD, CAE, CALS, CAM, CIM, FMS, PDES,
Manufacturing
Integrated Control Architectures, Adaptive-
Process Control
Sensor Technology
Active/Passive Sensors, Feedback and Process
Control, Nondestructive Evaluation, Industrial and
Atmospheric Environmental Monitoring & Control
Emerging Life Sciences Applications
Biotechnology
Bioprocessing, Drug Design, Genetic
Engineering, Bioelectronics
Medical Devices and Diagnostics
Cellular-Level Sensors, Medical Imaging, In-Vitro
and In-Vivo Analysis, Targeted Pharmaceuticals,
Fiber Optic Probes
a An explanation of acronyms can be found in Appendix A.
Source: Technical knowledge of staff of the U.S. Department of Commerce, in particular scientists and engi-
neers of the National Institute of Standards and Technology; based on interviews with U.S. international
science, engineering, and industrial experts.
9
Microwave Technology: Individual microwave components and antennas, and inte-
grated systems containing these components are finding new and expanded applications in
areas such as radar for robot vision, collision avoidance, and wind shear detection as well
as communications for direct satellite broadcast, personal communications, and worldwide
position determination. Further development of microwave technology strongly depends
on advances in materials processing and the design and fabrication of integrated circuitry
for very high frequencies.
Radiation Processing Technology: Accelerators and radionuclide sources are being
used in sterilization of foods and materials, curing of polymers (especially in the electronics
industry), radiation-induced catalysis, and waste processing. Entirely new products with
unique mechanical, electrical, and temperature resistance properties are possible. The use
of toxic materials and heat is avoided when these approaches are substituted for conven-
tional techniques.
10
4. Emerging Technologies in the International Context
In today's global economy, a multitude of national economies interact with each other
through trade. The role that governments have assumed in supporting research, technol-
ogy, and its applications varies over a wide spectrum of activities (see also Appendix E).
For example, in Japan, emphasis is placed on reducing ideas to practice; efforts are coordi-
nated and sponsored by a variety of organizations, led by the Ministry of International
Trade and Industry (MITI). The governments of the countries forming the European
Community (EC) address issues across the board, ranging from basic research to prototype
products with strong emphasis on full EC-wide coordination by 1992. The debate in the
United States centers on to what degree, if any, should the United States deviate from the
approach that has served its economy well in the past, i.e., the traditional focus of Govern-
ment support of basic research, defense technology, and agency mission-oriented R&D.
If foreign firms develop products based on emerging technologies faster and more
effectively than U.S. companies, then the price, performance and quality of foreign prod-
ucts may surpass U.S. offerings. In contrast, comparative success by U.S. firms in bringing
emerging technologies to market will stimulate more and better quality jobs, increase
exports, reduce imports, and contribute directly to material wealth. Not only will such
success improve the U.S. civilian industrial base, but it will foster improved national secu-
rity directly through dual-use technologies and indirectly by advancing the country's eco-
nomic strength. Furthermore, it will enhance the ability of the United States to spawn the
next generation of technology advances: the emerging technologies of the future.
Table 2 summarizes the driving forces that have created the new competitive realities.
Table 3 provides a summary of the relative standing of the United States, Japan, and the
European Community in R&D and product introduction. The information contained in
table 3 was compiled from the knowledge residing within the Department of Commerce,
mostly from contributors within the International Trade Administration and the National
Institute of Standards and Technology. Other experts and organizations might not agree
with every detail of this information but it represents the best estimates based on the
Department's extensive experience; further discussions are needed to refine our knowledge
and to analyze the driving forces and causes for the status and trends depicted by table 3.
Table 4 compares the categories of important emerging technologies made in this report,
with those in Japan and the European Community.
11
Table 2. Past versus Present: The New Environment for Emerging Technologies
Acceleration and globalization of the generation of technology:
Today, technology is generated at an accelerating pace in many industrialized countries. Rapid infor-
mation exchange and mobility of people often make new technical ideas quickly available on a global
scale. It can no longer be taken for granted that the country originating a new idea will be the country
most likely to reap its economic benefits.
Differentials In the cost-of-capital:
Higher interest rates, cultural practices, and tax laws combine to make the effective cost of capital
funds for U.S. firms more than twice as high as for their Japanese competitors and substantially higher
than for European firms.
Globalization of Industries:
Multinational corporations (based in the U.S. or abroad) decide what to produce and in which coun-
try. These decisions are based on sophisticated analyses of the manufacturing costs and of the capabil-
ities of modern laboratories and factories anywhere in the world.
Integration of the manufacturing process:
Japanese manufacturers have pioneered the integration of the manufacturing process which has re-
sulted in substantial time savings in product introduction as well as in superior product quality.
Research shows Japanese firms generally introduce manufactured products twice as fast as U.S. firms.
Increased cost of prototype production:
The complex, multidisciplinary nature of emerging technologies, as well as the need to establish
special test and/or process facilities and demonstration projects, often makes it prohibitively expen-
sive for even large corporations to go it alone. Investment requirements can exceed hundreds of
millions of dollars.
Expanded scope of benefits from emerging technologies:
The potential benefits from an emerging technology easily transcend the scope (i.e. the product
portfolio) of most, if not all, U.S. corporations. Thus, return on investment for an individual firm is
either unattractive or, if adequate, misses out on opportunities to exploit applications in other indus-
tries.
Source: Compiled from the knowledge residing within the Department of Commerce, mostly from contribu-
tors within the International Trade Administration and the National Institute of Standards and Technology.
12
Table 3. Relative Standing In Emerging Technologies: U.S. versus Japan and EC
JAPAN
EUROPEAN COMMUNITY
Product
Product
R&D
Introduction
R&D
Introduction
Advanced Materials
+
G
-
Advanced Semiconductor Devices
-
++>
Artificial Intelligence
+ -
+
+1
+
Biotechnology
+1
+ t
+1
+
Digital Imaging Technology
-
-
Flexible Computer-Integrated
+++
-
+1
-
Manufacturing
High-Density Data Storage
-
+
High-Performance Computing
+++
+1
+1
+
Medical Devices and Diagnostics
+++
+
+
+1
Optoelectronics
04>
- t
+
Sensor Technology
+ t
-
+
1
Superconductors
Current Status:
Trend:
+ = U.S. Ahead
1 = U.S. Gaining
o = U.S. Even
+ = U.S. Holding
}
(as compared to Japan/EC)
- = U.S. Behind
= U.S. Losing
Source: Compiled from the knowledge residing within the Department of Commerce, mostly from contribu-
tors within the National Institute of Standards and Technology and the International Trade Administration.
13
Table 4. Comparlson of Emerging Technology Categories: Japan, EC and U.S.
JAPAN
EUROPEAN COMMUNITY
U.S.°
New Materials
New Materials
Emerging Materials
Biotechnology
Biotechnology
Emerging Life Sciences
Biomaterials
Applications
Software Engineering
Information Technology
Emerging Electronics and
Electronics
Information Systems
-
-
Emerging Manufacturing
Systems
-
Energy
-
a MITI White Paper, Trends and Future Tasks in Industrial Technologies.
b First Report on the State of Science and Technology in Europe.
c This report.
14
5.
Opportunities for Change
In this chapter many of the factors that affect emerging technologies are discussed.
Together they form an environment that significantly influences the effectiveness and
speed of new product or process introduction as well as the likelihood that significant
shares of the global market can be attained and sustained. These phenomena are often
thought of as barriers that must be overcome. This discussion concentrates on areas (sum-
marized in table 5) where opportunities may be found to modify the environment so as to
lower the generic barriers to the effective development and commercialization of emerging
technologies. Appendix B compares this list to the 1987 DOC report (see footnote 1 on
page 7). The factors identified are preliminary, based on initial thoughts, and do not cover
all areas comprehensively.
Table 5. Opportunities for Change
The Cost of Research and Market Introduction
Engineering Training and Education
Integration of R&D, Design and Manufacturing
Improving the Quality of Products and Services
Improving the Technology Infrastructure
Product and Interface Standards
Dependence on Domestic Technologies and Markets
Industrial Cooperation
Protecting Intellectual Property Rights
Laws of Product Liability
Regulatory Constraints
Export Policy
Restrictive Foreign Trade Practices
Source: Compiled from the knowledge residing within the Department of Commerce.
The Cost of Research and Market Introduction
Low capital cost can facilitate the development and commercialization of new prod-
ucts in at least two ways. First, projects are less expensive, thus decreasing risk for large
companies and making it easier for small enterprises to enter the market. Second, the
required rate of return can be correspondingly smaller, and higher risk or longer term
projects are much more likely to be undertaken. Such considerations would therefore
encourage longer business horizons.
15
In the early stages of the R&D process, commercialization is an uncertain and rela-
tively distant event, and thus the investment risk is relatively high. Although investments
at this early stage can yield large payoffs, the rewards may be too far in the future to be
acceptable, even though the generic technology often can be applied to a number of
distinct markets. Once the generic technology is developed and applications begin to enter
the marketplace, the time to payoff is reduced, but the cost may be larger for late entrants
to the field who must first catch up in technical expertise. For example, generic ceramics
technology may have applications in such diverse markets as automobile engines, medical
implants, machine tools, optoelectronic devices, and electronic capacitors.
It is very difficult to compare capital costs in different countries, and even the most
sophisticated analyses are only estimates. Recent studies show, however, that capital costs
in the United States are substantially higher than in some European countries and have
been perhaps two to four times the costs in Japan. Prevailing interest rates play a funda-
mental role in the cost of capital, especially for small entrepreneurial companies. These
rates are influenced by many factors, including the size of the public-sector debt and the
rate of individual savings.
For larger firms, which may support research using income from other products, the
impact of tax laws may be just as important. At a time when foreign countries continue to
employ a variety of incentives to encourage the exploitation of emerging technologies,
recent changes and uncertainties in the U.S. tax laws have had the effect of reducing the
availability of funding for research and development by U.S. firms.
The research and experimentation tax credit, for example, was originally enacted in
1981 with an expiration date of December 31, 1985. The credit, which has subsequently
been extended repeatedly, is presently scheduled to expire on December 31, 1990. The
Bush Administration is actively seeking to make the credit permanent. Since 1984 the
business community has not known whether the R&D tax credit will continue from one
year to the next, creating great uncertainty. This has undermined to some extent the
original intent of the legislation, namely that the credit become a factor in encouraging
U.S. business to engage in long-term planning for R&D.
Engineering Training and Education
Success in global competition depends upon the availability of a well-educated and
highly skilled work force. It depends equally upon the effective management and motiva-
tion of the work force. Design engineering, manufacturing engineering, and the manage-
ment of technology are three areas of particular importance for the success of emerging
technologies.
16
Design engineering involves an appreciation of the importance of the relationship
between design and productivity. Designing for manufacturability is very important to
assure product quality and cost-effective production. Furthermore, everyone connected to
a product manufacturing line plays an important role in feeding information on the manu-
facturing process back to the designers. These concepts are key ingredients in productivity
improvement and are widely practiced particularly by Japan.
Manufacturing engineering requires a full appreciation of the interdisciplinary nature
of modern production methods. Accordingly, manufacturing engineers are trained in a
broad program with contributions from many disciplines. Decades ago, American engi-
neering schools moved away from the curriculum of engineering practice into a curricu-
lum of engineering sciences. This resulted in a shortage of adequately trained
manufacturing engineers; current emphasis is on reversing this situation.
Management of technology requires a broadly based, generalist engineer/business
graduate to create an integrated, interdisciplinary team approach to the manufacturing
enterprise. The required skills span fields such as basic engineering concepts, business
knowledge, systems analysis, operations research, and computing. If this need is to be met
by new graduates, it may take many years before they could expect to have a substantial
impact in industry. Therefore, a good understanding of technical factors by existing man-
agers is very important. It is also important to transmit the knowledge base on management
technology from industrial and governmental organizations to the schools.
Integration of R&D, Design, and Manufacturing
In the current global competitive market, rapid transformation of emerging technolo-
gies and product improvements into commercial products is critical, but this transforma-
tion is often hampered by inadequate integration of R&D, design, production, and
marketing. With tighter integration, Japanese firms often can transform an emerging tech-
nology into a commercial product twice as fast as U.S. firms.
Integration removes formal barriers between R&D, design, manufacturing, and mar-
keting. Each phase is continuously alert for problems that might be encountered in later
stages. In its ultimate realization, research, development, design, prototype production,
and marketing progress nearly simultaneously.
Integration, including concepts such as concurrent engineering, total quality, and just-
in-time production, require new tools to manage and disseminate information within an
organization. Information about all aspects of the manufacturing process must be made
readily available to everyone involved in production. Technology itself, in the form of
advanced computer systems and new concepts in information management, has proven to
be an effective facilitator.
17
Improving the Quality of Products and Services
Poor product quality often results from decisions and actions that preceded actual
production, particularly in the design phase or in purchasing parts and materials. Improve-
ments in the quality of the finished product must, therefore, focus on all aspects of the
production process, with special emphasis on the early design phases and on sensing and
process control. Adequate attention in these early stages may also lessen the time needed to
produce a commercial product. Being first to market is not enough if the quality of the
product is inadequate, especially if higher quality products also enter the market.
Beyond the many definitions of quality for performance, appearance, reliability, after-
sale service, form, fit, and function, quality ultimately refers to how well customers' expec-
tations are met in a competitive environment. This definition implies that there can never
be an absolute determination of product quality; it has to be evaluated in terms of other
products and the expectations of the user. This evaluation is especially important for a
product sold on the international market because the preferences and expectations of users
may vary from country to country. In 1987 the United States took a major step to focus
attention on the importance of excellence in quality management by establishing the Mal-
colm Baldrige National Quality Award. Since 1988, five U.S. companies have received this
award from the President of the United States.
In other countries, most notably Japan, techniques and processes for achieving consis-
tently high quality have progressed much more rapidly and have been more widely
adopted than in the United States. In contrast to the Japanese method of incorporating
quality control in all phases of the design and manufacturing process, U.S. firms (and the
U.S. government) often limit quality control to "inspecting quality in." Thus there is often
no incentive for suppliers to invest in advanced, comprehensive methods.
Improving the Technology Infrastructure
The technology infrastructure consists of the science, engineering, and other technical
resources that private industry needs to produce and market products and services compet-
itively. For example, industry draws upon externally provided generic technologies, tech-
nical information, and research and test facilities.
In many cases, the development of an emerging technology by industry can be accel-
erated by joint efforts which may involve government laboratories, universities, and uni-
versity research centers. These joint efforts are especially important in addressing elements
of the generic technology where no single industry has the resources or the focus to
undertake the research and where underinvestment in the generic technology would other-
wise result.
Other important aspects of the technology infrastructure are methods that enhance
the productivity of both the R&D and production phases and the efficiency of market
development. They include measurement and test methods, interface standards, quality
assurance models and methods, critically evaluated reference data and research, other
technical and economic data, and test facilities. Increased use of capital-intensive research
and test facilities, for which industry pays only the operating costs, would greatly facilitate
research and product development.
18
Product and Interface Standards
Standards play an essential role in domestic commerce and international trade by
providing written descriptions of products or services that can be used in transactions to
assure equity between buyers and sellers. Increasing worldwide emphasis on the develop-
ment and adoption of international standards by national standards organizations and gov-
ernmental bodies has the potential to reduce protectionism. It is, therefore, vital to
promote free-trade concepts in international arenas, especially for newly emerging tech-
nologies.
Influence on the international standardization process can be exerted best by strong
participation in domestic standards committees and technical advisory groups to interna-
tional committees and by concentrated efforts to maintain a vigorous presence in interna-
tional fora especially holding secretariats in international committees and working groups.
One of the major impacts of EC 1992, the European Community's agreement to
establish a single internal market by the end of 1992, will be European adoption of interna-
tional standards, where available. This policy underscores the need to have good interna-
tional standards in place early on. Lacking them, the European regional standards
organizations, CEN and CENELEC, will develop their own standards to implement EC
directives. The United States, lacking the right to participate in the European regional
bodies, will have to promote European consideration of U.S. technical advances. Simi-
larly, to the degree the United States works closely with developing countries, the promul-
gation of standards compatible with those in the United States will be encouraged.
Dependence on Domestic Technologies and Markets
The size and ready availability of the U.S. market to new products and services often
results in a complacent attitude in domestic companies, which do not fully appreciate the
need for competing with foreign firms. Especially in emerging technologies, where en-
trepreneurial (often small) firms dominate, a narrow focus on the U.S. market can prove to
be a costly mistake. American companies, separately and in joint ventures, increasingly
should seek export opportunities abroad and anticipate challenges in the United States
from new foreign competitors.
A special challenge lies in overcoming the mind set of technical and management staff,
which has often been called the "not invented here" syndrome. More aggressive pursuit of
technology developed overseas is imperative for U.S. industry to exploit the emerging
technologies. An increased awareness and acceptance of technological innovation occur-
ring abroad would help U.S. industry to design and manufacture advanced products and
use the most modern processes. New legislation and international agreements have paved
the way for improved U.S. access to foreign government supported R&D.
Industrial Cooperation
Cooperative arrangements among nonaffiliated firms in the private sector are often
essential for successful technological innovation and commercialization. For some tech-
19
nologies, cooperative efforts may be the only way of reducing the risk of developing
innovative product options. The required facilities are expensive to build and will only
become available to many U.S. firms if they are able to share the cost and risk of design
and construction.
The substantive principles of U.S. antitrust law have generally been regarded as rea-
sonable and as supporting efficient industry activity and low prices for goods and services.
Also, through increasingly sophisticated analysis, U.S. antitrust enforcement agencies and
courts have improved in their ability to differentiate between anticompetitive and benign
business arrangements. However, for U.S. firms in particular, uncertainty about the appli-
cability of the antitrust laws to such arrangements may chill a significant amount of poten-
tially beneficial industry activity. The antitrust legal process is extremely lengthy and
expensive, and business uncertainty as to its outcome remains a significant problem.
Traditional approaches to reducing antitrust uncertainty include issuance by the Jus-
tice Department of "business review letters," which indicate that agency's enforcement
intentions with respect to particular proposed conduct. More recently, enforcement guide-
lines have been issued, and laws to provide clarity or "safe harbors" in specific areas have
been proposed by the Executive Branch and passed by the Congress. Key enactments were
the Export Trading Company Act and the National Cooperative Research Act.
The Bush Administration is seeking to reduce antitrust uncertainty in the especially
important area of industry cooperation in the production of goods. It proposes to broaden
the National Cooperative Research Act to cover joint production ventures in addition to
the joint R&D ventures presently covered by that Act. Joint production ventures regis-
tered under the provisions of this legislation would be protected against treble damages in
private suits. They would also be assured that their arrangements cannot be judged per se
illegal, but will instead be evaluated under a "rule of reason" framework which is sensitive
to actual, rather than presumed, competitive effects.
Regardless of legislative restrictions, cooperative ventures in the United States are less
common than in other industrial countries (Appendix E). To some extent this is a result of
custom and attitude. For example, instead of working together, domestic firms often push
to have their own solutions accepted as a national standard because this strategy will often
confer a short-term advantage in the domestic market. Such a strategy might not be opti-
mal in the longer term, however, because it increases the vulnerability of domestic produc-
ers to foreign competition.
There also may be advantages in vertical linkages between a producer and its suppliers
and customers. Such agreements might violate restraint-of-trade laws under certain cir-
cumstances. These vertical linkages can be conduits for technological innovation and are
often exploited by foreign industry; it is less common for U.S. companies to do so. The
strong working relationship between U.S. airplane manufacturers and commercial airlines
is an exception and demonstrates the power of such relationships. Customer demand for
advances in speed, payload, fuel efficiency, and range encouraged manufacturers to de-
velop new airfoil designs, materials, engines, and wide-bodied airplanes.
20
Vertical linkages may have other advantages as well. U.S. producers (e.g., of semicon-
ductors) are often relatively small, highly entrepreneurial, individual companies. Many
lack the financial strength to fund expensive product development projects and to tide
them over during cyclical downturns in the business cycle. Others must raise short-term
capital by licensing new technology to other companies that often then become competi-
tors. Their Japanese counterparts, on the other hand, are large, diversified, and vertically
integrated. They can afford to be much more patient, to take a longer term view of the
development cycle, and to give support to other segments of the company. The down-
stream product lines of the company also provide a stable internal market for the new
products and feedback on outside consumer demand.
Furthermore, Japan is well positioned to capture the significant "economies of scope,"
or the multiple applications of emerging technologies, because of the way Japanese indus-
try is organized. Extensive interindustry and interfirm cooperative relationships, including
vertically integrated networks under common control, allow the introduction of new ma-
terials and components simultaneously in many different applications and markets.
Protecting Intellectual Property Rights
U.S. businesses rely upon strong intellectual property protection to realize the benefits
of emerging technologies. In fact, the rate of development of emerging technologies may
well depend upon patents as security for R&D and marketing investment and upon trade-
marks to build and protect reputations for quality. Barriers exist where laws, regulations,
or enforcement procedures are inadequate. When innovation is neither rewarded nor en-
couraged, markets are either forfeited, left untapped, or are underdeveloped.
Examples of domestic barriers include (1) the inadequacy of the statutory 17-year
patent term for certain agricultural and pharmaceutical products subject to extensive pre-
market testing, (2) the uncertain rules concerning the protection of software, (3) the diffi-
culty in patenting biological inventions (plants and animals), and (4) the absence of
effective protection for process patent holders against imports of products made abroad
illegally using the patented process.
The Omnibus Trade and Competitiveness Act of 1988 directs the U.S. Trade Repre-
sentative to identify those foreign countries that deny adequate and effective protection of
intellectual property rights to U.S. firms or that deny fair and equitable market access to
U.S. firms relying on intellectual property protection. This would include, for example, a
nation's outright appropriation of foreign-owned technologies or of creative and artistic
works. Other problems include the needs for international harmonization of patent laws
and for measures to address counterfeiting, piracy, and the protection of industrial prop-
erty.
Laws of Product Liability
It is important to evaluate the effect that U.S. product liability and tort laws have on
innovation, emerging technologies, and the general ability of domestic companies to com-
21
pete in the international market. In particular, the following issues have often been cited:
The U.S. has a patchwork of 50 different sets of State laws on product liability.
Cases based on similar facts, but tried in different States, can produce strikingly
different and contradictory results.
The transaction costs for all parties involved in litigation are enormous.
The costs of insurance for product-liability-related protection are particularly
high.
The Bush Administration has announced an initiative to seek significant reform of the
product liability system. The Administration has placed its strong support behind biparti-
san product liability legislation. The Administration will develop additional reform provi-
sions including fault-based manufacturer defenses to liability ("state-of-the-art defense"),
limits on punitive damages, extension of the limit on joint and several liability, and a time
limit that a product is subject to liability. The purpose of the Administration initiative is to
help preserve the U.S. competitive posture, while at the same time safeguarding consumer
interests.
Regulatory Constraints
Government regulations significantly affect the vast majority of new technologies and
products. Somewhere in the cycle of research and development, production and market-
ing, most new products will face testing, evaluation or approval for health, safety or
environmental reasons. The processes by which products are developed are equally regu-
lated-from traditional operations like the mining, transporting and smelting of ores to
"gene-splicing" or the irradiation of foods.
Federal regulations alone impose costs of over $100 billion annually on the U.S.
economy. Our stringent health, safety and environmental standards entail unusually high
costs which must be reflected in the prices charged for U.S. goods and services. Regula-
tory costs and uncertainties sometimes deter investment in regulated activities, which can
mean reduced innovation and slower productivity growth. Smaller-scale businesses in
highly competitive industries are especially disadvantaged by regulatory burdens.
The international competitive effects of regulation are difficult to measure because
they tend to be masked by externalities such as shifts in currency values, foreign govern-
ment subsidies, and dumping. Recent studies appear to demonstrate that regulatory costs
significantly affect capital formation.
Continuing the regulatory reform policies of the previous Administration, the Bush
Administration is committed to reducing regulatory burdens and costs on industry
wherever possible without endangering health, safety, or the environment. To that end,
particular stress is being placed on streamlining regulatory procedures and harnessing
market incentives to serve regulatory goals.
22
Export Policy
U.S. exports are controlled for national security purposes. Such controls do not serve
their intended purpose if they inhibit the sale of goods and technology that are no longer
strategic or are available from foreign competitors.
Unnecessary restrictions have three effects: First, the controls significantly limit U.S.
industry's access to foreign markets. Even if such access is not precluded, the cost of doing
business in those markets is increased. Second, the U.S. Government exercising control
over the re-export of foreign products incorporating U.S. parts and components has led a
number of foreign manufacturers to redesign their products so that they do not contain
U.S. components. Third, limiting sales to the domestic market reduces the profitability and
increases the cost of the product. In the long run, this contributes to the erosion of the
industrial base for defense-related products.
There are currently two export control processes that relate to security interests of the
United States. Products that are weapons systems, or primarily of military use, are in-
cluded on the Munitions List provided for in the Arms Export Control Act (AECA) and
issued by the State Department's Office of Munitions Control (OMC). The Department of
State, in consultation with the Department of Defense, reviews license applications for
exporting such goods.
Dual-use items are placed on the Commodity Control List requested by the Export
Administration Act (EAA); the review process for license applications is administered by
the Commerce Department, which can consult with DOD.
The EAA generally stipulates that an export license not be required for reasons of
national security, for a product if there are similar products of comparable quality available
on the international market from foreign sources in quantities sufficient to render the U.S.
control ineffective. The AECA, however, contains no such "foreign availability" clause,
and industry often finds export license applications rejected only to see a potential cus-
tomer turn to an alternative foreign supplier, thereby hurting the U.S. competitive posture
in the world market.
In addition to these national security controls, some U.S. exports are controlled by the
Commerce Department for foreign policy reasons, such as nonproliferation (nuclear, mis-
sile, chemical weapons precursors), anti-apartheid, and anti-terrorism. These controls are
imposed to achieve U.S. objectives to distance the United States from objectionable activ-
ities of certain governments or to support international agreements with other nations.
Unlike national security controls, foreign policy controls are not automatically removed
due to foreign availability, although it is taken into consideration.
The Omnibus Trade and Competitiveness Act of 1988 made some very substantive
changes in the Export Administration Act. One change virtually eliminates re-export con-
trols on foreign products which contain less than 25 percent U.S. parts and components,
and on all products being re-exported into COCOM countries. (COCOM = Coordinating
Committee consisting of the U.S., Canada, a number of Western European countries,
Australia, and Japan.) Another provision of the act eliminated U.S. licensing authority
23
over many products exported to a COCOM country. Since COCOM destinations repre-
sent a large market for U.S. firms, the reduction in licensing burden will be dramatic.
Further study of export policy may be appropriate after the effects of these changes in the
law become clearer.
Restrictive Foreign Trade Practices
Restrictive trade practices take many forms-laws, regulations, and practices-with -
the objective of protecting a home market from foreign products. The following are some
of the more frequently encountered practices:
Tariffs and other import duties designed to protect a foreign country's domestic
market rather than to raise revenues.
Import licensing intended only to create uncertainty, delays, and discrimination
for imported products.
Procurement policies by foreign governments; e.g., requirements to buy pref-
erentially national products.
Export subsidies programs.
Local or domestic content requirements (e.g., rules of origin) that prevent the
import of new products.
Nonsymmetrical access to government supported R&D.
Market reserve policies that designate certain markets for domestic products
only.
Disregard of intellectual property rights by foreign governments which under-
mines the ability to exploit markets with new products.
Although most actions are sponsored by governments, business practice and social
mores also may be significant. If they differ from those of the United States, they may act
as significant trade barriers, especially if they are institutionalized. Emerging technologies
are a particularly easy target because markets are not yet fully established and the protect-
ing country thus has little to lose by erecting barriers to the introduction of new products.
24
6.
Outlook
Emerging technologies offer the potential for substantial economic benefits. The eco-
nomic growth of many nations, especially that of the United States, has been based on the
development and successful introduction of emerging technologies (Appendix F). Lately,
U.S. industry has been unsuccessful in capturing the majority of benefits from emerging
technologies; at the same time, U.S. trading partners have demonstrated substantial eco-
nomic growth through the marketing of products based on U.S.-developed technologies.
As a result, the present outlook for the success of U.S. high-technology industry in the
global marketplace is of concern to many. This issue is receiving attention at the highest
levels in industry, academia, and government.¹ A number of conferences, studies, and
reports on this subject have generated considerable material but consensus on actions has
not been reached as yet.
Nevertheless, there appears to be a strong interest in taking action to improve U.S.
competitiveness. This report is intended to facilitate this process. New strategies can best
emerge from a continuing dialogue among representatives from industry, labor, academia,
and government. It is hoped that the information this report contains will serve to stimu-
late and assist in this dialogue. An in-depth exchange of ideas and information between all
segments of our economic and technical community is a prerequisite for developing con-
certed actions. Actions are needed to maximize the benefits that we can derive, as a nation,
from the opportunities offered by emerging technologies. If we succeed in stimulating
improved competitiveness, then the outlook is good because this country remains strong in
the generation of new science and technology options.
1 Current administration policy supports a Federal role in fostering and promoting R&D related to civilian
technologies that may have major impact on the U.S. economy and its international competitiveness. As an
illustration of this policy, the National Action Plan on Superconductivity Research and Development, prepared by
the White House's Executive Office of the President, December 1989, states, "Superconductivity, along with
other enabling technologies. will not be industry specific and, thus, warrants assistance where feasible and
appropriate from the Government. The multidisciplinary nature of the technology and the fact that the benefits
from commercialization will accrue over such a long term make it difficult for individual firms to justify
capitalizing the basic R&D expenses for commercialization With fierce international competition, time will be
critical in transferring the technology into marketable products The vertically integrated industrial entities
that can spread the costs of R&D investments have a strategic advantage in capturing future markets."
25
APPENDICES
A Detailed List of Emerging Technologies
B Comparison of the 1990 and 1987 DOC Emerging Technologies Reports
C Comparison of the Emerging Technologies with the Critical Technologies of the
Department of Defense
D National Security Concerns
E Investment in R&D and Consortia by Japan, EC and U.S.
F Comparison of Industry Growth Rates
G Bibliography
27
Appendix A Detailed List of Emerging Technologies
The following pages, one for each emerging technology, give more detailed technical
and market information on the technologies. The name selected for each of the emerging
technologies is one in general use, which is recognizable by the informed public. The
specific item headings and their contents are of a more technical nature and are briefly
described below.
Major Technology Elements:
A listing of the more specific technology areas that describe the emerging technology. In most cases,
more than one area is listed for each emerging technology since the advances tend to occur in several
narrow fields at the same time.
What It Is:
A brief nontechnical description of the emerging technology and its importance.
Underlying Sciences:
A listing of the specific scientific or engineering competencies felt to be of critical importance for the
development and marketing of products based on the emerging technology. Capability in the basic
scientific areas, such as physics, chemistry, materials science, computer science, and engineering, is obvi-
ously required for all of the emerging technologies.
Engineering Barriers:
A listing of those technical impediments that must be eliminated or circumvented before products can be
marketed based on the emerging technology.
What Is New or Better:
The specific improvements in processes, procedures, devices, or products that result from the introduc-
tion of the emerging technology.
Impact on What Products or Processes:
A listing of product and/or manufacturing areas that will directly benefit from the emerging technology.
Likely Markets or Industries:
A listing of those major market areas that will directly benefit from the emerging technology.
DOD Critical Technologies Comparlson:
A listing of the DOD Critical Technologies thought to benefit directly by the development of the
emerging technology. Using the DOD sequence numbering, the DOD list is taken from the Department
of Defense Critical Technologies Plan (see Bibliography). This comparison is summarized in Appendix C.
Annual Sales by Year 2000:
An estimate of the total U.S. and world market size directly resulting from the emerging technology. The
figures are taken from published studies, if a specific market study is available, and the reference given.
If a market study does not exist, estimates were developed as follows: the U.S. Department of Labor
Projections 2000 (Bulletin 2302, March 1988) was used as the source for a projected U.S. market size in
the year 2000, medium estimate, at the 4-digit SIC code level. An adjustment to this projection was made
by an estimate of the fraction of the total market resulting from the specific emerging technology.
29
ADVANCED MATERIALS
Major Technology Elements:
Structural and Functional Ceramics, Ceramic and Metal Matrix Composites, Inter-
metallic and Lightweight Alloys, Advanced Polymers, Surface-Modified Materials,
Diamond Thin Films, Membranes, Biomaterials.
What It Is:
Advanced metals and alloys, ceramic and polymeric materials, and composites of
these constituents used to produce devices and structures having improved perfor-
mance characteristics and special functional attributes.
Underlying Science:
Solid-state physics and chemistry, interface and surface science, mechanics, fluid dy-
namics.
Engineering Barriers:
Rapid and reliable processing methods are needed; complex failure mechanisms need
to be understood and related to processing and service-produced microstructures.
What Is New or Better:
Improved functional and structural properties like high-temperature strength, creep
resistance, and corrosion resistance for ceramics and intermetallic alloys; composites
offer high strength and stiffness combined with low weight, corrosion resistance, high
dimensional stability; technology for controlling composition and processing that al-
lows "designed in" properties.
Impact on What Products or Processes:
Devices and structures used at very high temperatures or special service applications;
aircraft, aerospace, transportation, electronics, construction, wear resistant items.
Likely Markets and Industries:
Aerospace, construction, engines, electronics, manufacturing, energy.
DOD Critical Technologies Comparison:
20. High-Temperature/High-Strength/Lightweight Composite Materials
Annual Sales by Year 2000:
U.S.: $150B
World: $400B
30
ADVANCED SEMICONDUCTOR DEVICES
Major Technology Elements:
Silicon, Compound Semiconductors (GaAs), ULSI, Memory Chips, X-ray Lithogra-
phy.
What It Is:
Improved materials, fabrication techniques, and advanced components and devices for
use in electronic equipment of all kinds.
Underlying Science:
Solid-state physics and chemistry, surface and separation science, electrical and elec-
tronics engineering, electrical properties of materials. Optical, x-ray, ion-beam fabrica-
tion methods.
Engineering Barriers:
Difficulties in manufacturing at high volume, yield and quality but low cost. Must
control contaminants and prepare high-purity gases and liquids.
What Is New or Better:
Improved speed, higher operating frequencies, reduced size, higher density, and mul-
tiple functions, lower cost, heat dissipation.
Impact on What Products or Processes:
Integrated circuits, smart power transistors, semiconductor materials, micromachines,
solar cells, memory chips, microprocessors.
Likely Markets and Industries:
Electronics, television manufacturing, communications, computers, recording
devices, medical and manufacturing equipment, toys and tools, aerospace-any area
which requires significant use of electronics.
DOD Critical Technologies Comparison:
1. Microelectronic Circuits and Their Fabrication.
2. Preparation of Gallium Arsenide (GaAs) and Other Compound Semiconductors.
Annual Sales by Year 2000:
U.S.: $75B
World: $200B
ULSI = Ultra large-scale integration
GaAs = gallium arsenide
31
ARTIFICIAL INTELLIGENCE
Major Technology Elements:
Intelligent Machines, Intelligent Processing of Materials and Chemicals, Expert Sys-
tems.
What It Is:
Electronic and electromechanical systems incorporating knowledge-based control
systems.
Underlying Science:
Data structures, data management systems, software engineering, servo engineering,
biological and cognitive sciences and engineering, numerical analysis, statistical
physics.
Engineering Barriers:
Size of databases, computational speed, lack of formal tools for knowledge representa-
tion.
What Is New or Better:
Improved performance over current systems which are at most capable of a limited
number of responses to events fully anticipated in advance. Improved graphical repre-
sentation of results.
Impact on What Products or Processes:
Manufacturing of machine tools, robots, construction equipment. Materials and chem-
ical processing; computer-aided design; signal and image processing. Analysis of med-
ical tests or symptoms.
Likely Markets and Industries:
Manufacturing, mining, security, health care, construction, materials processing, com-
munication and financial services.
DOD Critical Technologies Comparison:
5. Machine Intelligence/Robotics
9. Sensitive Radars
11. Automatic Target Recognition
13. Data Fusion
Annual Sales by Year 2000:
U.S.: $5B
World: $12B
32
BIOTECHNOLOGY
Major Technology Elements:
Bioprocessing, Drug Design, Genetic Engineering, Bioelectronics.
What It Is:
Production of high value-added biological products on a commercial scale. Modify
the genetic machinery of living cells to produce useful biochemicals.
Underlying Science:
Genetic engineering, molecular biology, chemical engineering, biochemistry, bio-
physics.
Engineering Barriers:
Difficulty in controlling processes in large-scale bioreactors and making economical
large-scale separations. Lack of measurement tools, data and knowledge to control
cellular processes and to elucidate protein structure/function relationships for intelli-
gent product and process design.
What Is New or Better:
Biosensors for on-line, real-time control; new and efficient separation and purification
methods. New or better techniques to produce natural and/or new biochemicals;
more efficient bioprocesses.
Impact on What Products or Processes:
Production of high value-added chemical products and new engineered chemicals.
Likely Markets and Industries:
Pharmaceutical and related products; foods, flavors, and fragrances; agrichemicals,
commodities and fuels, pollution abatement.
DOD Critical Technologies Comparison:
22. Biotechnology Materials and Processing
Annual Sales by Year 2000:
U.S.: $15-40B (1989 U.S. Industrial Outlook, DOC, Jan. 1989)
World: $40B
33
DIGITAL IMAGING TECHNOLOGY
Major Technology Elements:
High Definition Systems, HDTV, Large Displays, Data Compression, Image Process-
ing.
What It Is:
Use of digital technology to store, display, process, analyze and transmit images.
Underlying Science:
Electronics, artificial intelligence, communications engineering, surface science, solid
state physics and chemistry.
Engineering Barriers:
Large, high-resolution (flat) displays, storage requirements for digital information,
effective utilization of bandwidth, computer speed and memory, ability to recognize
characteristic features in complex images.
What Is New or Better:
Advances in digital cameras, high-volume information storage and retrieval, high-
speed computing (including parallel processing), higher resolution video display.
Impact on What Products or Processes:
Industrial processes in which the human eye or other detectors are used for inspection
and monitoring, photography, printing, television, computer manufacture, process
control systems, telecommunications.
Likely Markets and Industries:
Electronics, computers, process control and inspection, medical diagnostics, con-
sumer electronics, telecommunications, broadcast television, satellite broadcast, data
storage, defense industries, nondestructive inspection and evaluation.
DOD Critical Technologies Comparison:
9. Sensitive Radars
11. Automatic Target Recognition
Annual Sales by Year 2000:
U.S.: $3.3-4.3B (1989 estimate by the American Electronics Association)
World: $5B
HDTV = high-definition television
34
FLEXIBLE COMPUTER-INTEGRATED MANUFACTURING
Major Technology Elements:
CAD, CAE, CALS, CAM, CIM, FMS, PDES, Control Architectures, Adaptive-
Process Control.
What It Is:
A new approach to manufacturing and construction requiring not only technology but
management and engineering adjustments. Use of computers, robots, and intelligent
machines in the total manufacturing and construction enterprise. Integration of both
the materials handling and processing systems as well as the planning, logistics, and
business systems.
Underlying Science:
Control theory; operations research; electrical, mechanical, manufacturing, and indus-
trial engineering; business and management science.
Engineering Barriers:
Need for data structures to describe product and process. Concurrent engineering to
integrate design and manufacture. More reliable machines, automated process plan-
ning, "smarter" robots, more accurate and inexpensive sensors.
What Is New or Better:
Reduce cost and time to manufacture, improve quality; permit competition by scope
and variety of product line; reduce inventory, manufacture to order rather than to
plan.
Impact on What Products or Processes:
Manufacturing discrete and batch parts; economical small lot manufacture; continuous
and adaptive processes; chemicals, pharmaceuticals, steel, paper, textiles; residential
and commercial construction, public works.
Likely Markets and Industries:
High-tech manufacturing, automotive, construction, home appliance, computers, of-
fice machines, machine tools, aerospace.
DOD Critical Technologies Comparison:
5. Machine Intelligence/Robotics
Annual Sales by Year 2000:
U.S.: $10-20B
World: $20-40B
CAD = computer-aided design
CAE = computer-aided engineering
CALS = computer-aided logistics support
CAM = computer-aided manufacturing
CIM = computer-integrated manufacturing
FMS = flexible manufacturing systems
PDES = product data exchange specification
35
HIGH-DENSITY DATA STORAGE
Major Technology Elements:
High-Density Magnetic Storage (including perpendicular recording), Magneto-
Optical Storage.
What It Is:
Erasable (read/write) data storage offering several orders of magnitude improvement
in information storage density.
Underlying Science:
Optical physics, surface science, magnetics, solid-state physics, mechanical engineer-
ing, fluid dynamics (aerodynamics).
Engineering Barriers:
Magnetic disk and tape: interaction between read-write head and magnetic media sur-
face; crosstalk; size of information cells (domains); flatness (of disks); error detection.
Magneto-optical disk: mass of read head that slows access time; relaxation effects;
spacing of tracks; tracking; size of information cells.
What Is New or Better:
Magnetic disks with thin-layer technology: steady increases in information density (dou-
bles about every 3 years); reduced access time (mean time to get to data from random
location on disk or tape).
Magneto-optical disks: Very high information densities; reduced danger of contact
with storage media and lower cleanliness requirement offer potential of high reliability
and provide removable media.
Impact on What Products or Processes:
Data storage devices, home and studio audio and video, computers, communications,
television, consumer cameras (with magnetic disks instead of film), office information
storage systems. Information now stored on paper and film.
Likely Markets and Industries:
Computers (super to PC), office equipment, recording systems, cameras.
DOD Critical Technologies Comparison:
7. Integrated optics
Annual Sales by Year 2000:
U.S.: $15B-100B
(Note: The larger estimate of $100B assumes that a
World: $30B
significant portion of the paper and microfilm market
is captured.)
36
HIGH-PERFORMANCE COMPUTING
Major Technology Elements:
Modular/Transportable Software, Numerical Simulation, Neural Networks.
What It Is:
Design and development of architectures for rapid and efficient processing; develop-
ment of ways to program large systems to perform complex tasks.
Underlying Science:
Software engineering, microelectronics, optoelectronics, data structures and al-
gorithms, numeric and symbolic methods, computational science and technology.
Engineering Barriers:
Reliability, accuracy, and automated development are deficient. Software is difficult
to specify and to design; development is costly and time consuming, and it is difficult
to test for failures that might occur during use.
What Is New or Better:
High-performance computers can address large problems of numerical and scientific
computing such as weather forecasting, hydrodynamics, aerodynamics, weapons re-
search, prototyping of products and facilities, and high-energy physics.
Impact on What Products or Processes:
Computer and communications systems of all sizes, networking, word processing,
information retrieval and distribution, database management, manufacturing pro-
cesses, engineering design, science, research and development in all fields.
Likely Markets and Industries:
Manufacturing, business, service industries, research organizations, product, process,
plant prototyping.
DOD Critical Technologies Comparison:
3. Software Producibility
4. Parallel Computer Architectures
6. Simulation and Modeling
13. Data Fusion
15. Computational Fluid Dynamics
Annual Sales by Year 2000:
U.S.: $50-100B
World: $100B
37
MEDICAL DEVICES AND DIAGNOSTICS
Major Technology Elements:
Cellular-Level Sensors, Medical Imaging, In-Vitro and In-Vivo Analysis, Targeted
Pharmaceuticals, Fiber Optic Probes.
What It Is:
Health-care diagnosis and treatment equipment and supplies based on new sensors,
biotechnology processes and imaging devices.
Underlying Science:
Immunology, microbiology, biology, electronics engineering.
Engineering Barriers:
Need to design instruments with little or no invasion of the human body. Cellular level
devices and diagnostics will require miniaturization, capabilities not presently avail-
able.
What Is New or Better:
The capability to detect and understand defects at cellular level. Opportunity to har-
ness biomolecules as sensitive probes. Minimize trauma during treatment and diag-
noses. Improved diagnostic and therapeutic systems.
Impact on What Products or Processes:
Diagnostics and treatment equipment, health-care products, including diagnostic in-
strumentation such as magnetic resonance imaging and CAT scanning, clinical analyz-
ers, radiation treatment.
Likely Markets and Industries:
Health-care, instrumentation, pharmaceutical, medicine.
DOD Critical Technologies Comparison:
22. Biotechnology Materials and Processing
Annual Sales by Year 2000:
U.S.: $8B
World: $16B
CAT = computer-aided tomography
38
OPTOELECTRONICS
Major Technology Elements:
Integrated Optical Circuitry, Optical Fibers, Optical Computing, Solid-State Lasers,
Optical Sensors.
What It Is:
The use of light (visible, IR, UV radiation) as the means to transmit, process, and store
information.
Underlying Science:
Optical physics and engineering, solid-state physics, surface science, electronic engi-
neering.
Engineering Barriers:
Device speed; integration of components with electronic devices; laser performance;
materials limitations.
What Is New or Better:
Improved information handling capacity and signal quality, reduced sensitivity to
interference, increased processing speed and data storage capacity.
Impact on What Products or Processes:
Long-distance and local fiber optic systems; electrical, mechanical, and thermal sen-
sors; computers; chemical and mechanical manufacturing processes.
Likely Markets and Industries:
Telephone, television, teleconferencing, on-demand audio and video programming,
telecommunications, electric power, computers, manufacturing, medical diagnostics
and therapy.
DOD Critical Technologies Comparison:
7. Integrated Optics
8. Fiber Optics
Annual Sales by Year 2000:
U.S.: $4.6B
(U.S. Department of Commerce, International
World: $10.8B
Trade Administration, "International
Competitiveness Study of the Fiber Optics
Industry," p. 25, September 1988. Optical
fiber communication components only -
optical sensors alone add $1B worldwide.)
IR = infrared
UV =ultraviolet
39
SENSOR TECHNOLOGY
Major Technology Elements:
Active/Passive Sensors, Feedback and Process Control, Nondestructive Evaluation,
Industrial and Atmospheric Environmental Monitoring and Control.
What It Is:
Devices that provide a signal (generally optical, electrical, or acoustical) that accu-
rately reflects some process parameter in real time.
Underlying Science:
Electronics, nondestructive evaluation, control theory, mechanical and industrial en-
gineering.
Engineering Barriers:
Currently, sensors lack one or more of the following characteristics: range, stability,
precision, resistance to harsh environment, selectivity, sensitivity. Integration of sen-
sors and signal processing.
What Is New or Better:
New sensors measure parameters more accurately and in real-time under a wider
range of conditions due largely to better materials, fabrication techniques, and more
complex electronics and data processing.
Impact on What Products or Processes:
Continuous process industries like materials, food and beverage, pharmaceutical,
chemical, biochemical, smelting and refining; waste management, construction, manu-
facturing.
Likely Markets and Industries:
Chemical smelting and refining, pharmaceutical, food and beverage, electric power,
materials.
DOD Critical Technologies Comparison:
5. Machine Intelligence/Robotics
10. Passive Sensors
Annual Sales by Year 2000:
U.S.: $5B
World: $12B
40
SUPERCONDUCTORS
Major Technology Elements:
High-Temperature Ceramic Conductors, Advanced Low-Temperature Conductors.
What It Is:
(1) Superconducting materials having critical transition temperatures (Tc) above 77 K
(boiling point of liquid nitrogen).
(2) Low-temperature superconductors with improved performance characteristics
and materials properties.
Underlying Science:
Solid-state physics, ceramic processing science, electronic engineering, surface sci-
ence.
Engineering Barriers:
Low current densities and strengths in bulk forms. Composition and environmental
stability. Integrated circuit fabrication technology. Economical refrigeration tech-
niques.
What Is New or Better:
Tc above 77 K significantly reduces cost by eliminating liquid helium as coolant. Low-
temperature superconductors yielding sophisticated integrated devices, even first mi-
croprocessors. Powerful magnets for research and medical diagnostics, magnetically
levitated trains.
Impact on What Products or Processes:
Electronics; electrical transmission, switching, motors, and controls; electric power
generators; medical diagnostic equipment; rail and ship transportation; computers;
particle accelerators.
Likely Markets and Industries:
Electronics and data processing, electric power equipment, medical diagnostics, trans-
portation equipment, high-energy physics.
DOD Critical Technologies Comparison:
21. Superconductivity
Annual Sales by Year 2000:
U.S.: $3-5B
(1989 U.S. Industrial Outlook, DOC, Jan. 1989)
World: $8-12B
41
Appendix B Comparison of the 1990 and 1987 DOC Emerging
Technologies Reports
Comparison of Emerging Technologies
1990
1987
Advanced Materials
Advanced Materials
A. Ceramics
B. Polymer Composites
C. Metals
Thin Layer Technology
A. Surfaces & Interfaces
B. Membranes
Advanced Semiconductor Devices
Electronics
A. Advanced Microelectronics
Artificial Intelligence.
Computing
B. AI Techniques
Biotechnology
Biotechnology
A. Genetic Engineering
B. Biochemical Processing
Digital Imaging Technology
(None)
Flexible Computer-Integrated
Automation
Manufacturing
A. Manufacturing
High-Density Data Storage
Automation
C. Technical Services
High-Performance Computing
Computing
A. Computing Equipment
Medical Devices and Diagnostics
Medical Technology
A. Drugs
B. Instruments & Devices
(none)
Electronics
C. Millimeter Wave
Optoelectronics.
Electronics
B. Optoelectronics
Sensor Technology
(None)
Superconductors
(None)
(None)
Automation
B. Business & Office Systems
43
Comparison of 1990 Opportunities for Change and 1987 Barriers
1990
1987
The Cost of Research & Market
High Cost of Capital/Tax Incentives
Introduction
Engineering Training and Education.
(Not identified separately)
Integration of R&D, Design, and
(Same)
Manufacturing
Improving the Quality of Products
(Not identified separately)
and Services
Improving the Technology
(Not identified separately)
Infrastructure
Dependence on Domestic
(Same)
Technologies and Market
Industrial Cooperation
Antitrust restrictions
Protecting Intellectual Property
(Same)
Rights
Laws of Product Liability
(Same)
Regulatory Constraints
(Same)
Export Policy
(Same)
Restrictive Foreign Trade
(Same)
Practices
Product and Interface Standards
(Not identified separately)
44
Appendix C Comparison of the Emerging Technologies with
the Critical Technologies of the Department of Defense¹
DOC
DOD
Emerging Technologies
Critical Technologies
Advanced Materials
(20) High-Temperature/High Strength/Lightweight
Composite Materials
Advanced Semiconductor Devices
(1) Microelectronic Circuits & their Fabrication
(2) Preparation of GaAs and other Compound
Semiconductors
Artificial Intelligence
(5) Machine Intelligence/Robotics
(9) Sensitive Radars
(11) Automatic Target Recognition
(13) Data Fusion
Biotechnology
(22) Biotechnology Materials & Processing
Digital Imaging Technology
(9) Sensitive Radars
(11) Automatic Target Recognition
Flexible Computer-Integrated
(5) Machine Intelligence Robotics
Manufacturing
High-Density Data Storage
(7) Integrated Optics
High-Performance Computing
(3) Software Producibility
(4) Parallel Computer Architectures
(6) Simulation and Modeling
(13) Data Fusion
(15) Computational Fluid Dynamics
Medical Devices and Diagnostics
(22) Biotechnology Materials & Processing
Optoelectronics
(7) Integrated Optics
(8) Fiber Optics
Sensor Technology
(5) Machine Intelligence/Robotics
(10) Passive Sensors
Superconductors
(21) Superconductivity
Also Listed:
(12) Phased Arrays
(14) Signature Control
(16) Air Breathing Propulsion
(17) High Power Microwaves
(18) Pulsed Power
(19) Hypervelocity Projectiles
1 "The Department of Defense Critical Technologies Plan," Department of Defence (DOD), Washington, DC
May 1989. The numbers in the table refer to the numbers used in the DOD document.
45
Appendix D National Security Concerns*
The defense industrial base generally comprises the same manufacturers that produce
goods for the general public. Few industries rely primarily or completely on the Depart-
ment of Defense as their principal market. However, the Department depends on virtually
every sector of the manufacturing base for material. Ninety-five percent of the manufac-
tured goods purchased by the Department of Defense come from a broad spectrum of 215
industries. In 1985, the Department spent almost $165 billion within these industries. This
represented 4.1 percent of America's total gross national product and 21 percent of the
manufacturing gross national product. However, while the Department of Defense is a
major purchaser of manufactured goods, we recognize that in many important sectors,
such as electronics, we purchase only a small portion of total output. Even so, our market
share (even in the electronics industry) can provide us with substantial leverage if properly
managed.
In addition to meeting requirements for the production of today's weapon systems, the
Department's investment in the industrial base must encourage the research and develop-
ment for advanced technologies that are key to the next generation of weapon systems.
These include technologies such as infrared focal plane arrays, microwave devices, ad-
vanced sensors, exotic alloys requiring powdered metallurgy technology, high tempera-
ture ceramic composites, and high temperature superconductors. Additionally, advanced
manufacturing strategies, such as flexible computer integrated manufacturing, must be de-
veloped for and integrated into the entire industrial base.
As a nation and as a continent, we no longer are totally self-sufficient in all essential
materials or industries required to maintain a strong national defense. Consequently, we
must identify requirements carefully and assess them against our industrial base capabili-
ties. We must develop strategies that enable us to meet security needs with available
resources. For those essential products the United States does not manufacture, we must
rely on offshore sources or stockpiles. We can, however, offer incentives to establish
domestic manufacturing industries for these products.
Clearly, the Department of Defense cannot provide massive financial assistance for
every American industry characterized by a lack of international competitiveness, nor can
we effectively provide incentives for every manufacturing industry critical to our defense.
The issue of competitiveness is one that requires continuing creativity and innovation
within the private sector. There are numerous factors that industries themselves must come
to grips with if they are to remain competitive in the international market place. There are
also national issues, such as our tax code and antitrust laws, that warrant our attention. Our
education system has been cited as providing a less than adequate technically trained labor
force for the future. To the extent that these and other national issues affect the industrial
base, the Department of Defense intends to stimulate, when warranted, appropriate activi-
ties throughout the Government to address them.
*This text is taken from the first part of the summary of Bolstering Defense Industrial Competitiveness (see
Bibliography).
47
Within the Department of Defense acquisition process we have identified several
areas that are impediments to efficient defense production. Frequent policy changes,
emerging technologies, changing military requirements, the defense budgeting process,
and program and budget instability make long-term planning difficult. Typically, small
volume purchases and program stretch-outs contribute to an environment in which defense
contractors have little incentive to make long-term investments in facilities with advanced
capabilities that could yield higher quality and more competitive products.
Commercial market rewards for performance are lacking in the defense market. Unit
cost reductions, quality improvement, shortened delivery times, etc., neither stimulate de-
mand for additional units nor provide greater market share; nor do unit cost reductions
result in increased profit. Emphasis on lowest bid cost may result in inadequate attention to
life cycle costs, quality, and past performance.
The Department of Defense reliance upon detailed product and process specifications
can be counterproductive. Outdated specifications frequently reduce innovation, inhibit
improvements, and result in excessive administrative processes required to implement,
monitor, waive, or modify specifications. Procurement processes focus mainly on prime
contractors, even though materials and components purchased by prime contractors from
lower-tier industries represent 50 to 85 percent of our total expenditures. Historically, the
Department has had limited direct influence on the performance of subtier contractors
because of considerable administrative difficulty in passing performance incentives
through prime contractors to multiple levels of subcontractors and suppliers.
Finally, layers of bureaucracy and somewhat cumbersome contract administration
processes add to the costs of doing business with the Department of Defense. Government
emphasis on oversight activities can lead business managers to focus more on meeting
inspection requirements than on improving quality and productivity.
This Department of Defense report is designed to provide both a strategy and specific
initiatives to address this concern. Integral to this strategy is a recognition that the Depart-
ment's influence is, at the same time, significant and limited. The strategy suggests exploit-
ing the Department's leadership and leverage potential to strengthen the industrial base,
but not to the exclusion of other Departmental priorities such as a well equipped force
structure. On the other hand, it is neither possible nor desirable for the Department to
solve all the ills of the commercial manufacturing sector.
The cornerstone of this effort is cooperation with domestic industry and our allies.
The United States could not build fortress America, even if this were a desirable objective.
Nor can the Department of Defense reverse worldwide economic trends, such as the
internationalization of manufacturing. To maximize domestic industry's potential, coopera-
tive relationships must flourish among the Department of Defense, large corporations, and
the lower-tier manufacturing industries that are the foundation of our industrial base.
48
Appendix E Investment in R&D and Consortia by Japan,
EC and U.S.
The intensity and diversity of cooperative research is a reflection of the importance
accorded to emerging technologies; the majority of cooperative projects (probably at least
75 percent of total expenditures) deals with emerging technologies.
R&D as % of GNP
Gov't.
Consortla
Gov't.
(1985)
Share of
As % of
Share of
Total
Civilian
Total
Total
Consortla
JAPAN
2.6%
2.5% (est)
19%
≈ =4%
=50%
EC
1.9%
1.4%
45%
=4% ≈
=50%
U.S.
2.8%
1.9%
47%
<1%
<20%
JAPAN
Most R&D (>70%) is performed in private industry. Consortia are significant within Govern-
ment R&D funding (=10% of total). Focus is on consumer application.
EC
Industry probably carries out less than half of all R&D. Consortia are important within Gov-
ernment R&D funding (=5% of total). Focus is on civilian applications.
U.S.
Most R&D (>70%) is performed in private industry. Consortia are relatively insignificant
within Government R&D funding (<0.5% of total). Focus is on national security.
Listed below are only those projects which have significant involvement by the respective Governments.
Privately operated consortia are not listed; for example, the National Cooperative Research Act of 1984
relaxed antitrust provisions for cooperative research ventures. More than 150 such ventures have registered
including SEMATECH; most of these do not involve Government funding.
JAPAN
8 large-scale projects (MITI)
Friend 21 (MITI)
3 next-generation industry projects
9 ERATO projects (STA)
20 Japan research development corporation projects (STA)
62 key technology center consortia
119 KTC lending projects
SIGMA software project
6 superconductivity projects
Human frontier science plan
International frontier research plan
EC
>200 ESPRIT projects
>200 EUREKA projects
100 BRITE projects
50 RACE projects
JESSI project (under discussion)
EURAM program
U.S.
Variety of cooperative efforts, primarily sponsored by DOD (in particular DARPA).
SEMATECH
AISI/DOE steel technology program
Sources: Economic Report of the President, 1988
First Report on the State of Science and Technology in Europe, 1988
MITI White Paper: Trends and Future Tasks in Industrial Technology, 1988
49
Appendix F Comparison of Industry Growth Rates
Intensive use of technology and industrial growth are correlated. The table below
compares the 10 SIC (Standard Industrial Classification) industries experiencing the
highest growth rates over the past 16 years (1972-88) with the 10 industries having the
lowest growth rates during this period. The top 10 are all technology-based industries,
whereas the last 10 have pursued strategies that are much less technology dependent.
Relative Shipments Growth, 1972-88
(1988 shipments as a percentage of 1972 shipments)
(1982 $)
SIC
TOP 10
RATE
SIC
LAST 10
RATE
3573
Computing Equipment*
8823
3211
Turbine Generator Sets
17
3674
Semiconductor Devices*
6072
2793
Photoengraving
23
3832
Optical Devices/Lenses
940
2121
Cigars
35
3693
X-ray Apparatus
537
2386
Leather/lined Clothing
38
2795
Lithographic Services
394
3743
Railroad Equipment
42
2831
Biological Products
387
2661
Bldg Paper/Board Mills
42
3678
Electronic Connectors
356
3333
Primary Zinc
44
2833
Medicinals & Botanicals
347
3552
Textile Machinery
48
3842
Surgical Appliances
337
3021
Rubber/Plastic Footwear
50
3841
Surgical & Medical Inst
327
2517
Wood TV, Radio Cabinets
50
*The growth rates of these two technologies have been adjusted for technical change as well as price change.
Source: Department of Commerce, U.S. Industrial Outlook, 1988
51
Appendix G Bibliography
The following list is not intended to be comprehensive. Rather, it is meant to provide
additional information, complementing and supplementing this report.
1989
The Department of Defense Critical Technologies Plan, U.S. Department of Defense, Wash-
ington, DC, May 1989.
Economic Report of the President, Council of Economic Advisors, U.S. Government Print-
ing Office, Washington, DC, January 1989.
Governing America: A Competitiveness Policy Agenda for the New Administration, Council
on Competitiveness, Washington, DC, 1989.
International Cooperation and Competition in Materials Science and Engineering, NISTIR
89-4041, September 1989.
The Learning Enterprise, A. P. Carnevale and L. J. Gainer, report by the American Society
for Training and Development for the U.S. Dept. of Labor, 1989.
Made in America: Regaining the Productive Edge, Michael L. Dertouzos, Richard K.
Lester, Robert M. Solow, and the MIT Commission on Industrial Productivity, The MIT
Press, Cambridge, MA, 1989.
Materials Science and Engineering for the 1990s: Maintaining Competitiveness in the Age of
Materials, National Academy Press, Washington, DC, September 1989.
Policy Imperatives for Commercialization of U.S. Technology, Conference Digest, IEEE,
February 1989.
U.S. Industrial Outlook, U.S. Department of Commerce, Washington, DC, January 1989.
1988
Bolstering Defense Industrial Competitiveness, Department of Defense, Washington, DC,
July 1988.
The Challenge to Manufacturing: A Proposal for a National Forum, National Academy of
Engineering, Washington, DC, 1988.
Defense Science Board Summer Study on The Defense Industrial and Technology Base, De-
partment of Defense, Washington, DC, October 1988.
First Report on the State of Science and Technology in Europe, Commission of the European
Community, 1988.
Foreign Investment in the United States: A Cause for Concern?, Jane Sneddon Little, New
England Economic Review, July/August 1988.
53
Frontiers in Chemical Engineering; Research Needs and Opportunities, Committee on Chem-
ical Engineering Frontiers, N. R. Amundson, Chairman, National Academy Press, Wash-
ington, DC, 1988.
High Temperature Superconductivity: Perseverance and Cooperation on the Road to Commer-
cialization, The Committee to Advise the President on High Temperature Superconductiv-
ity, Washington, DC, 1988.
Industrial R & D and the U.S. Technological Leadership, National Academy of Sciences,
National Research Council, National Academy Press, Washington, DC, 1988.
Industrial R & D in Japan and the United States: A Comparative Study, E. Mansfield,
University of Pennsylvania, 1988.
Manufacturing Technology and the U.S. Engineer, Conference Digest, 1988 USAB Confer-
ence on U.S. Technology Policy, The Institute of Electrical and Electronics Engineers,
Inc., New York, NY, 1988.
Picking Up the Pace: The Commercial Challenge to American Innovation, Council on Com-
petitiveness, Washington, DC, 1988.
Projections 2000, U.S. Department of Labor, Bureau of Labor Statistics, Bulletin 2302,
March 1988.
The Technological Dimensions of International Competitiveness, National Academy of Engi-
neering, Washington, DC, 1988.
Technology and the American Economic Transition: Choices for the Future, Office of Tech-
nology Assessment, Washington, DC, May 1988.
Technology and the Competitive Challenge, Research & Development, Helmut Hellwig,
Cahners Publishing Company, July 1988.
Technology and Competitiveness: A Key to the Economic Future of the United States, John A.
Young, Science, Volume 241, July 15, 1988.
Trends and Future Tasks in Industrial Technology (Sangyo Gijutsu no Doko to Kadai), MITI
White Paper, 1988.
U.S. Competitiveness: Beyond the Trade Deficit, George N. Hatsopoulos, Paul R. Krugman,
Lawrence H. Summers, Science Magazine, July 1988.
1987
The CORETECH Agenda: Toward A National Policy On Research and Development,
CORETECH Council on Research and Technology, Washington, DC, 1987.
Directions in Engineering Research; an Assessment of Opportunities and Needs, Engineering
Research Board, A. E. Puckett, Chairman, National Academy Press, Washington, DC,
1987.
54
Key Technologies for the 1990s, An Overview, Aerospace Industries Association of America,
Inc., Washington, DC, November 1987.
Management of Technology: The Key to America's Competitive Future, Public Affairs Coun-
cil, American Association of Engineering Societies.
Science and Technology Policies and Priorities: A Comparative Analysis, Leonard L. Leder-
man, Science, Volume 237, September 4, 1987.
The Status of Emerging Technologies: An Economic/Technological Assessment of the Year
2000, U.S. Department of Commerce, National Bureau of Standards, Gaithersburg, MD,
NBSIR 87-3671, June 1987.
Survey on the Direction of Japan's Technological Development, Science & Technology in
Japan, November 1987.
Technology and Global Industry, National Academy Press, Washington, DC, 1987.
1986
Physics Through the 1990's, Physics Survey Committee, W.F. Brinkman (Chairman), Na-
tional Academy Press, Washington, DC, 1986.
1985
Global Competition: The New Reality, President's Commission on Industrial Competitive-
ness, Washington, DC, January 1985.
Opportunities in Chemistry, Committee to Survey Opportunities in the Chemical Sciences,
G. C. Pimentel (Chairman), National Academy Press, Washington, DC, 1985.
1982
The Competitive Status of U.S. Industry, National Academy of Engineering, Washington,
DC, 1982.
55
MEMBERSHIP OF THE
INTERAGENCY COMMITTEE FOR FEDERAL LABORATORY TECHNOLOGY TRANSFER
Commerce
Honorable Deborah Wince-Smith
Assistant Secretary for Technology Policy
U.S. Department of Commerce
Room 4818, Hoover Building
14th Street and Constitution Ave., N.W.
Washington, D.C. 20230
Phone: (202) 377-1581
Agriculture
Honorable Charles E. Hess
Assistant Secretary for Science and Education
U.S. Department of Agriculture
Room 217W, Administration Building
Washington, D.C. 20250
Phone: (202) 447-5923
Interior
Honorable John Sayre
Assistant Secretary for Water and Science
U.S. Department of the Interior
1849 C Street, N.W.
Mail Stop 6640
Washington, D.C. 20240
Phone: (202) 208-3186
EPA
Honorable Erich Bretthauer
Assistant Administrator for Research
and Development
U.S. Environmental Protection Agency
Waterside West Building, Room 913
Washington, D.C. 20460
Phone: (202) 382-7676
Air Force
Honorable John J. Welch, Jr.
Assistant Secretary for Acquisition
U.S. Department of the Air Force
Pentagon, Room 4E964
Washington, D.C. 20330-1000
Phone: (703) 697-6361
Army
Honorable George E. Dausman
Deputy Assistant Secretary for Procurement
U.S. Department of the Army
SARD-ZP
Pentagon, Room 2E-661
Washington, DC 20310-0103
Phone: (703) 695-2488
Navy
Honorable Gerald Cann
Assistant Secretary for Research, Development,
Acquisitions
U.S. Department of the Navy
Pentagon, Room 4E732
Washington, D.C. 20350
Phone: (703) 695-6315
Defense
Honorable Raymond Siebert
Deputy Under Secretary for Research and
Advanced Technology
U.S. Department of Defense
Pentagon, Room 3E114
Washington, D.C. 20301-3000
Phone: (703) 695-5036
NASA
Mrs. Margaret G. Finarelli
Associate Administrator for
External Relations
National Aeronautics and Space Administration
Federal Office Building 6, Room 7021
400 Maryland Avenue, S.W.
Washington, D.C. 20546
Phone: (202) 453-8310
Energy
Honorable Peter Saba
Principal Associate Under Secretary for
Policy, Planning and Analysis (PE-1)
U.S. Department of Energy
Room 7B-084
1000 Independence Avenue, S.W.
Washington, D.C. 20585
Phone: (202) 586-4159
Transportation
Mr. Mark Dowis
Associate Administrator for Research and
Special Programs Administration
U.S. Department of Transportation
Room 8410
400 Seventh Street, S.W.
Washington, D.C. 20590
Phone: (202) 366-4433
HHS
Honorable Frank E. Young
Deputy Assistant Secretary for Health,
Science, and Environment
U.S. Department of Health and Human Services
Humphrey Building, Room 701-H
200 Independence Avenue, S.W.
Washington, DC 20201
Phone: (202) 245-6811
OSTP
Dr. William Phillips
Associate Director for Industrial Technology
Office of Science and Technology Policy
Old Executive Office Building, Room 432 1/2
Washington, D.C. 20506
Phone: (202) 395-3125
USTR
Honorable S. Bruce Wilson
Assistant U. S. Trade Representative
Office of the U.S. Trade Representative
Winder Building, Room 401A
600 17th Street, N.W.
Washington, D.C. 20506
Phone: (202) 395-7320
VA
Dr. Stephen Litwin
Deputy Assistant Chief Medical Director
Veterans Administration Central Office
810 Vermont Avenue, N.W.
Washington, D.C. 20420
Phone: (202) 233-2616
CPSC
Dr. Robert D. Verhalen
Associate Executive Director
Consumer Safety Products Commission
5401 Westbard Avenue
Washington, D.C. 20207
Phone: (301) 492-6440
DEPARTMENT OF COMMERCE
UNITED STATES DEPARTMENT OF COMMERCE
The Assistant Secretary for Technology Policy
UNITED STATES of AMERICA
Washington, D.C. 20230
APR 2 1991
Memorandum for Interagency Committee for Federal
Laboratory Technology Transfer
From:
Deborah L. Wince-Smith DWS
Subject:
Federal Research In Progress (FEDRIP)
The purpose of this paper is to give you a quick review of
where we were, where we are now, and where we hope to go
in the effort to improve FEDRIP, a major Federal database
with the potential to serve as a point of entry into the
Federal laboratory system.
Background -- Where we were.
At the present time, 10 Federal agencies contribute to the
database, compiled by NTIS and containing over 120,000
records. It was first offered to the public on-line via
Dialog in 1983. Several Executive Branch agencies as well
as private sector users of FEDRIP have suggested that it
could be substantially more useful if there were some
modifications made to make it reflect a bit more the "real
world". One private sector user of FEDRIP stated that if
FEDRIP were simply better organized and maintained, it
could make a major contribution to technology transfer.
Progress report -- Where we are.
We have convened meetings of lead Federal agencies which
either now contribute to FEDRIP or which could make a
major contribution if they were to do so. We have also
met with representatives of private firms that now use
FEDRIP or need to use the kind of information that it
could provide. In many cases the latter have been
discouraged from using the present system by its
difficulty in use.
Dr. Caponio, Walter Finch, Associate Director for Products
at NTIS, and his staff, have been very good in helping us
to understand what is now in the database and what
modifications are practical.
Targeted changes
O More agencies participating: We ought to have more
agencies in FEDRIP. Ideally, FEDRIP will make it much
easier for industry to identify interesting R & D.
Participation in FEDRIP can also ensure that agencies
are meeting public notification responsibilities.
Office of Technology Commercialization
Page 1
O More frequent updates: National Science Foundation
has indicated that effective April '91 it will update
its file monthly, instead of twice a year. We would
like all agencies to make a similar effort.
o Simplified format and a few additional pieces of
information: After intensive discussion with private
and Federal users, data vendors and NTIS, it seems
that much of the information which industry would like
to see is already there, it is just that the display
formats and search procedures have not been easy to
use or interpret. The attached sample record format,
developed from all the meetings, shows what many
potential users would find most useful on an initial
display.
Since NTIS offers FEDRIP to Dialog and other vendors,
they are working to get some changes made by Dialog.
NTIS also is offering the database to other vendors or
users who may be better at implementing the simplified
format than DIALOG. One of the new vendors plans to
offer FEDRIP in a new, simplified format in Spring of
1991.
Next Steps -- Where we are going.
To make the indicated changes in FEDRIP in FY 91, we need
to accelerate through participation at your level. We
need the Interagency Committee members to tell their
agencies how important it is that they make the results of
their work known, through FEDRIP or some other means. For
those agencies not participating, we ask you to look again
at using FEDRIP. For others, the request may be to try
increasing the frequency of update or to be sure to put in
the data which would allow the Sample Form to be filled
out.
We expect there will be a need for checking with agencies
and their technical staff as well as with some of the
Senior officers to help implement the changes. NTIS is
proposing another follow-up meeting with FEDRIP technical
contacts and we stand ready to assist as necessary.
If you could review your agency's participation in FEDRIP
as well as the attached form to see some new information
proposed and get back to us in two weeks I would
appreciate it very much.
Attachment
Office of Technology Commercialization
Page 2
Federal Research in Progress Display Format
Subject:
Principal investigator/tech transfer agent:
Tel. #:
Fax. #:
Level of effort (Funding or staff years):
Start & estimated end date:
Record date:
Interested in collaborative effort?:
Performing organization:
ABSTRACT:
Objective of research-
Planned research approach-
Specialized eqpt?:
May others use it?:
Progress report summary-
Descriptors:
Accession # (or alternate ID):
[Note: Bold Italic indicates new or variation on extant field of interest.
Some of the agencies, like Agriculture, now use at least parts of the
suggested abstract headings.]
Office of Technology Commercialization
March 30, 1991
Johnson/Mullins
HOUSE GOP SCIENCE NEWS
A Newsletter from the Republican Members of the
Science, Space & Technology Committee
January, 1991
Contact: Christopher Wydler, Legislative Director (202-225-6684)
The Republican Members of the House Science, Space and Technology
Committee in the 102nd Congress are: Robert S. Walker (PA), Republican
Chairman; F. James Sensenbrenner, Jr. (WI); Sherwood L. Boehlert (NY);
Tom Lewis (FL); Don Ritter (PA); Sid, Morrison (WA); Ron Packard (CA);
Paul B. Henry (MI); Harris B. Fawell (IL); D. French Slaughter, Jr. (VA);
Lamar Smith (TX); Constance A. Morella (MD); Christopher Shays (CT);
Dana Rohrabacher (CA); Steven H. Schiff (NM); Tom Campbell (CA); John
J. (MD). Rhodes, III (AZ); Joe Barton (TX); Dick Zimmer (NJ); Wayne Gilchrest
1991 will be a critical year if the Committee on Science, Space and Technology is going to
reassert its influence over policy and program priorities. Two major developments lend
optimism in this regard.
Of course, the Science Committee has a new Chairman, Congressman George E. Brown,
Jr. of California. A very active member of the Committee since 1965, Representative
Brown brings genuine interest and leadership to the post. Widely respected by his
colleagues for his institutional knowledge and experience on science matters, "George
Brown is someone we have worked with very well in the past," attested Republican
Chairman Robert Walker. "Based on our good relationship, we anticipate hitting the
ground running together." Early staff appointments and other actions by the new
Chairman have been especially encouraging.
On the matter of authorizations, over 30 measures considered by the Committee in the
101st Congress became law in such areas as NASA, science education, global change and
clean air research, hydrogen energy, and earthquake and FAA R&D. However, although
all these authorization bills directing and limiting spending and setting policy and program
priorities were enacted, they were very often ignored, even violated, in the appropriation
process. In response, Congressman Walker has introduced H.R. 432, an innovative new
proposal to change the budget process by putting direct funding power in the hands of the
authorizers where it belongs.
This proposal would require binding budget resolution functional allocations and revenue
projections, consistent with the Gramm-Rudman-Hollings targets, to be made directly to
the relevant authorizing committees, as determined by the Parliamentarian, for direct
funding or collection. This would eliminate the appropriation process. Supplementals
would also have to be reconciled against Gramm-Rudman-Hollings True continuing
resolutions could be recommended by the Budget Committee only if necessary after
September 15. Members serving on the Budget Committee could not serve on an
authorizing committee.
This process would bring much greater discipline to the system. It would require a
theoretically objective, disinterested budget panel to set broad government policy
regarding the relative share of available Federal resources that should be dedicated to
general purposes (i.e., defense, science, housing, etc.) within overall statutory fiscal
constraints. The actual funding decisions would then be in the hands of the people with
the greatest expertise on policy and priorities within these general issue areas for the first
time. The Science Committee, for instance, would be making all actual spending decisions
by rationalizing priorities, against a set pot of money, within its logically comparable
jurisdiction (e.g., relative funding for the SSC versus the Space Station, instead of more
VA benefits versus the Space Station, as is the case now). This takes the power of the
purse out of the hands of a relatively chosen few and spreads it out over the whole
Congress, reducing the "insider trading" that often results in pork-barrel, meritless
appropriations. No Members would have a hand in all funding decisions as they do now.
The business at hand for the Science Committee, itself, in 1991 is early enactment of
fiscally-responsible multi-year authorizations. Many Members support setting a goal of
legislative items include:
sending all Committee authorizations to the Floor no later than May 15. Major
Technology Bill-At the very end of the 101st Congress, an agreement was reached on a
either House before adjournment. The final agreement: sets the authorization for the
comprehensive emerging technology commercialization bill, but it was not brought up by
advanced technology program (ATP) at $100.0 million annually, with grant payback
required, to reduce the marginal cost of capital for developing new technologies by
leveraging the majority funding of competitively selected industry-led joint ventures;
establishes a "blue ribbon" National Capital Cost Reduction Commission, chaired by the
Vice President with three members appointed by the President, House, and Senate, to
make legislative and tax recommendations to Congress within one year; and authorizes
the National Institute of Standards and Technology core research program at $211 million
in FY 1992 consistent with current Commerce Department planning for initiatives in such
areas as superconductivity, advanced materials, fiber optics, etc. It is hoped that this
legislation will move through both bodies quickly, provided it is based on the agreement.
NASA Authorization-Although the House passed a multi-year National Aeronautics and
Space Administration (NASA) authorization bill, the final agreement with the Senate
provided support only through FY 1991 ($15.0 billion). The 102nd Congress will therefore
need to provide resources beyond the current fiscal year. As a result of the Report of the
Augustine Advisory Committee on the Future of the U.S. Space Program, debate during
reauthorization will likely focus on questions of reorganization and reform within NASA,
as well as specific project funding.
Space Commercialization Bill-Republican Chairman Walker will again introduce
legislation designed to bring America's entrepreneurial skills to bear upon the exploration
and industrial development of outer space. The bill requires an inventory of federal
space launch support facilities which may be surplus to public or national security needs
and makes such facilities available for auction to the private sector. Additionally, the
bill: creates commercial space zones; offers tax incentives to the private sector for
building space zones and for space launches and manufacturing undertaken from or in
such zones; requires the government to procure launch services from the private sector
when such services are not related to national security or government-sponsored
research; includes antitrust exemptions to permit private sector collaboration in space
R&D and production; and authorizes non-federal cash awards for persons who have
substantially advanced space transportation, manufacturing, or R&D.
NOAA Authorization-Although the House sent two National Oceanic and Atmospheric
Administration (NOAA) multi-year reauthorization bills to the Senate during the 101st
Congress, neither bill was considered on the Senate floor. The Science Committee is
expected to again move a multi-year NOAA authorization measure providing over $1.0
billion annually for "dry" NOAA activities including: stable, long-term support for
weather service modernization; the replacement of aging satellites; and global change
research. The Science Committee's last NOAA proposal is consistent with current
Commerce Department planning and could serve as the basis for early action.
EPA R&D-During the 101st Congress, the Committee passed an Environmental Protection
Agency (EPA) R&D bill authorizing $476.9 million in FY 1992 and $555.1 million in FY
1993. Because of jurisdictional claims by the Committee on Energy and Commerce,
however, the measure failed to reach the House floor. Legislation is needed to support,
among other things: the R&D provisions under the Clean Air Act (P.L. 101-549); pollution
prevention technology R&D; and groundwater, indoor air quality and radon research.
Civilian Energy Supply R&D-During the 101st Congress, the Committee only had two
Department of Energy (DOE) programs pass: renewables-conservation and the Super
Conducting Supercollider (SSC) project. The Committee's jurisdiction over DOE totals
more than $5.0 billion, yet in the 101st Congress other authorizing legislation was simply
not marked up. During the 102nd Congress, the Committee is expected to be more active
in authorizing funding for projects within its jurisdiction (e.g., advanced reactor
legislation) based on the President's National Energy Strategy.
Uranium Enrichment-It was proposed in the 101st Congress that the Uranium
Enrichment program be allowed to operate as a government corporation. The issue of
converting the program into a profitable commercial enterprise with an equitable sharing
of existing liabilities that protects the taxpayer will be considered by the Committee.
Software Tech Transfer-Republican Member Connie Morella has introduced H.R. 191,
the Technology Transfer Improvement Act. Referred to both the Science and Judiciary
Committees, this bill would amend the Stevenson-Wydler Act to grant private sector
participants in cooperative research and development agreements with Federal
laboratories copyright protection for any new software developed. The government
would retain all rights to use the software for the public good, but proprietary use would
be exclusive. This would be an added incentive to further develop and commercialize
Federal technologies.
07/13/90
11:59
NO. 156
P001
FORM CD.403
(REV 12.86)
U.S DEPARTMENT or COMMERCE
INSTRUCTIONS Submit original copy of this cover
FACSIMILE TRANSMISSION COVER SHEET
sheet with the document to be transmitted. Fill in
all information requested Do NOT fill in shaded area.
OFFICE BURI AU
DATE SUBMITTED
DOCUMENT TITLE
DoC / TTA/SWE
7/13
NO OF PAGE$
Semiconductor Equip
12
NAME AND MAILING ADDRESS OF RECIPIENT
RECIPIENT TELEPHONE NO
FACSIMILE TELEPHONE NO
TO
din Wethington
456-7739
PROJECT APPROPRIAT NUMBER
COMMENTS
FYI
NAME AND BUILDING ADDRESS or SENDER
TELEPHONE NO
FROM
Jack McPhee
377-
2846
USCOMM DC 86.2 150
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
02a. Memo
Jack McPhee to Olin Wethington
7/13/90
(b)(1)
Re: Qs and As (1 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
02b. Report
Re: [Semi-Conductors] (11 pp.)
n.d.
(b)(1)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
03. Transmittal
Deborah Wince-Smith to Olin Wethington (2 pp.)
7/9/90
(b)(1)
Sheet
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
04. Talking Points
Re: Talking Points on the Semi-Gas CFIUS Investigation (3
7/10/90
(b)(1)
pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
JUL-10-1990 08:10 FROM NIST DOC OFFICE
TO
94567739 P.01
FACSIMILE COVER SHEET
NIST-DOC OFFICE
HERBERT c. HOOVER BUILDING, ROOM 4841
Washington, DC 20230
202-377-4844
FAX # - 202-377-4362
TO:
NAME OLIN WETHINGTON
ORGANIZATION
RUSH
TELEPHONE NUMBER
FROM:
NAME
GARY P. CARVER
ORGANIZATION COMMERCE
TELEPHONE NUMBER
377-4596
NUMBER OF PAGES 17 (INCLUDING COVER SHEET)
more info to follow
Gary
JUL-10-1990 08:10 FROM NIST DOC OFFICE
TO
94567739
P.02
DEPARTMENT OF THE TREASURY
WASHINGTON
JUL 6 1990
ASSISTANT SECRETARY
MEMORANDUM FOR THE HONORABLE STEPHEN HADLEY, ASSISTANT SECRETARY
FOR INTERNATIONAL SECURITY POLICY, DEPARTMENT OF
DEFENSE
THE HONORABLE EUGENE J. MCALLISTER, ASSISTANT
SECRETARY FOR ECONOMIC AND BUSINESS AFFAIRS,
DEPARTMENT OF STATE
THE HONORABLE MICHAEL SKARZYNSKI, ASSISTANT
SECRETARY FOR TRADE DEVELOPMENT, DEPARTMENT OF
COMMERCE
THE HONORABLE LINN WILLIAMS, DEPUTY UNITED STATES
TRADE REPRESENTATIVE
THE HONORABLE JOHN TAYLOR, MEMBER, COUNCIL OF
ECONOMIC ADVISERS
THE HONORABLE JAMES F. RILL, ASSISTANT ATTORNEY
GENERAL FOR ANTITRUST, DEPARTMENT OF JUSTICE
MR. PHILLIP DUSAULT, DEPUTY ASSOCIATE DIRECTOR FOR
INTERNATIONAL AFFAIRS, OFFICE OF MANAGEMENT
AND BUDGET
DR. W. D. PHILLIPS, ASSOCIATE DIRECTOR FOR
INDUSTRIAL TECHNOLOGY, OFFICE OF SCIENCE AND
TECHNOLOGY POLICY
FROM:
John M. Niehuss
Acting Assistant Secretary for
International Affairs
SUBJECT:
CFIUS meeting at 9 a.m., Tuesday, July 10, 1990,
Room 2127, Main Treasury
There will be a CFIUS meeting at the policy level at the above
date/time to develop a recommendation to the President on the
Nippon Sanso/Semi Gas transaction. The attached draft will serve
as a frame of reference for our discussion.
In as much as the conference room is much smaller than the one we
usually use, I would ask that you limit attendees to principal
plus one.
Please call Carmen Law or Bobbie Wallman (566-2386) to arrange
admittance into the building.
Attachment
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
05. Report
Re: Report of the Committee on Foreign Investment in the
7/10/90
(b)(1)
United States (CFIUS) on the Proposed Acquisition (15 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
the
RUSH
SEAL
DEPARTMENT OF THE TREASURY
(If Received INCOMPLETE call (202) 566-2942)
6556
Unclass: lied
(CLASSIFICATION)
TO:
Qlin Washington
DATE: July 9,90 90
456-1139
(Name and Tel. #)
FAX Number
(Verify)
FROM: S.
(Name)
(Office H/C Symbol)
335-6334
(Phone #)
HANDLE AS:
ROUTINE
PRIORITY
0
URGENT
PAGE 1 OF 1 PAGE(s)
NOTE:- - Single Pages ONLY - DO NOT Staple - Provide Clear Copy
(Original Not Returned)
REMARKS/SUBJECT
COMCEN USE ONLY - DO NOT WRITE BELOW
Sender's FAX Numbers: (202) 566-8066 - (202) 535-3807 - (202) 535-5846
R & D - TOR
6556
SSN NUMBER:
ARTMENT OF THE TREASURY
1990 JUL -9 PM 5 05
no math. security problem
Unin Carlon
polysishin sofa
Tom Dorsey, OMB
395-3947
JUL-10-1990 08:43 FROM NIST DOC OFFICE
TO
94567739
P.01
FACSIMILE COVER SHEET
NIST-DOC OFFICE
HERBERT C. HOOVER BUILDING, ROOM 4841
Washington, DC 20230
202-377-4844
FAX # up 202-377-4362
TO:
NAME OLIN WETHINGTON
ORGANIZATION
RUSH
TELEPHONE NUMBER
FROM:
NAME
GARY P. CARVER
ORGANIZATION COMMERCE
TELEPHONE NUMBER
377-4596
16
NUMBER OF PAGES
(INCLUDING COVER SHEET)
more info to follow
Here's
Some addn't
Gary
info Have
a perfect
day!
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
06a. Memo
Gary P. Carver to Deborah L. Wince-Smith
6/29/90
(b)(1)
Re: CFIUS Case on the Acquistion of Semi-Gas by nippon
Sanso (3 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
06b. Memo
Deborah L. Wince-Smith to Michael Skarzynski
7/9/90
(b)(1)
Re: Nippon Sanso/Semi-Gas CFIUS Invesigation (2 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
JUL-10-1990 08:47 FROM NIST DOC OFFICE
TO
94567739 P.08
SEMICONDUCTOR INDUSTRY ACQUISITIONS
"ACQUIRING THE CHAIN"
CHIPS
(ADVANCED MICRO DEVICES)
SILICON WAFERS
(MONSANTO)
MATERIALS AND EQUIPMENT
(MATERIALS RESEARCH CORPORATION)
MASKINGS
(TEXAS INSTRUMENTS)
CAPACITORS
(AVX CORPORATION)
HIGH & ULTRA PURITY POLYSILICON
(UNION CARBIDE)
SEMICONDUCTOR GAS PROCESSING/PURIFICATION
(SEMI-GAS SYSTEMS)
30 + CFIUS NOTIFICATIONS (ACQUISITIONS) HAVE INVOLVED
SEMICONDUCTOR-RELATED COMPANIES
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
06c. Report
Re: Nippon Sanso (2 pp.)
7/10/90
(b)(1)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
JUL-10-1990 08:48 FROM NIST DOC OFFICE
TO
94567739
P.11
AUTHOR UNKNOWN
ROUGH DRAFT
THE CHANGING FACE OF COMPETITION
IN THE GAS EQUIPMENT INDUSTRY
This draft attempts to capture the major issues of the acquisition of Semi-Gas
purification industry.
Systems by Matheson/Nippon Sanso and its impact upon the gas equipment and
1. Loss of American Exports. Currently Semi-Gas Systems, operating with
independence from a gas supplier, is the leading and perhaps the only exporter
of gas systems equipment to Europe and the Asia Pacific market place. The
suggested operating plan calls for Semi-Gas Systems to reduce its activities in
the Asia Pacific market in the very near future resulting in a loss of revenue
of approximately $3 million to $5 million per year.
2. Balance of Trade with Japan and Access to the Japanese Market. Semi-Gas
Systems has been working with several marketers in Japan to expand its market
share in the Japanese semiconductor industry. The acquisition brings with it
the restriction of independent Semi-Gas sales activity in Japan along with a
controlled access to the Japanese market through Nippon Sanso. The Japanese
semiconductor equipment market is the largest in the world and the proposed
acquisition will deny access to the Japanese market for the only viable U.S. gas
systems producer.
3. Loss of U.S. Technology Leadership. Currently Semi-Gas has a leading technical
position in the gas equipment market based on the automation technologies
within its Auto-Purge® family of products and the gas purification technologies
in the Nanochem® product family. Nippon Sanso has said that they wished to
take both of these technologies to Japan for further development for the
Japanese market. This can result in the Japanese semiconductor producers
receiving the latest product and technology improvements prior to making those
same technologies and improvements available to semiconductor manufacturers
in the rest of the world.
4. Loss of U.S. Income Tax Revenue. It is alleged that Nippon Sanso was able to
offer a substantially higher price for Semi-Gas Systems because their U.S.
subsidiary, Matheson, bas substantial tax loss carry-forwards. Semi-Gas, on the
other band, has been profitable over the long term and if it remained
independent, would expect to pay $1+ million in income taxes over the next
several years. In effect, part of the financing of this acquisition has been
shouldered by the U.S. taxpayer.
JUL-10-1990 08:49 FROM NIST DOC OFFICE
TO
94567739
P.12
5. Loss T of U.S. Market Share of Gas Equipment. With ASGT now owned by L'Air
owned. industry. This means that about 25-30% of the industry capability is U.S.
Air Products and SCI are viable players in the U.S. specialty gas equipment
iquide, Airco owned by BOC, and Semi-Gas owned by Nippon Sanso, only
6. Focus on Jafanese American Customers. Nippon Sanso's reasons for acquiring
Semi-Gas have been stated as, "desire to have a U.S. based producer to provide
equipment to the American factories of Japanese semiconductor producers".
Japanese producers.
Currently virtually all of Matheson's equipment sales are to U.S. factories of
7. Loss of Independence. Currently Semi-Gas Systems, as a non-aligned equipment
supplier, is able to work with all gas companies, world wide, without fear of
conflicts and cross purposes. The acquisition will lead to the end Semi-Gas'
relationships with Linde and BOC, which could dramatically lower the sales
success ratio of Semi-Gas.
8. Loss of Sematech. Semi-Gas Systems, as the first member of SEMI/Sematech
and as a key contributor to the gas team at Sematech, has been able to focus
its product improvement and product development strategies to rapidly develop
relationship between Semi-Gas and Sematech will be severed as a result of this
improved products to meet the needs of the industry. The close working
acquisition and it is very likely that Semi-Gas will find it difficult to remain
current with the needs of the semiconductor industry.
JUL-10-1990 08:49 FROM NIST DOC OFFICE
TO
94567739 P.13
STRATEGIC IMPORTANCE OF SEMI-GAS' AUTOMATION TECHNOLOGY
As the semiconductor industry moves to larger size chips and finer line widths, the
purity of the gases used in chip fabrication becomes ever more important. Gas
purity is a function of chemical technology in the creation and purification of gases,
the inherent cleanliness of the valves and piping systems containing those gases, and
the procedures by which the gas systems are operated.
The most common operating procedure is the exchange of empty cylinders for full
cylinders of process gas. During this process a technique known as "purging" is
used to eliminate unwanted or undesirable chemical contamination. The
automation of these procedures has proven to greatly reduce chemical
contamination of semiconductor process gases.
Semi-Gas has developed a micro-processor based, automated gas control system
known as Auto-Purge®. It is important to note that Semi-Gas Systems has
approximately 80% of the market for automated gas systems within this country.
Automation of gas systems has been fairly common in the United States for the
past several years and has recently become a subject of interest to semiconductor
manufacturers outside of this country. The technology for the automation of gas
systems in both Japan and Europe substantially lags that of Semi-Gas Systems, the
market leader in the U.S. It is also important to realize that Semi-Gas Systems has
generated substantial numbers of export dollars in selling its automated gas systems
to the world wide semiconductor industry. (A list of customers is attached.)
In discussions with a potential Japanese acquirer, it has been clearly indicated that
one of their primary interest in Semi-Gas is the acquisition of the gas systems
automation technology. They have also stated that it would be their desire to
import the technology to Japan, to fabricate the automation modules in Japan, and
to supply the Japanese semiconductor industry from their existing systems business
unit which is a current competitor to Semi-Gas Systems.
The result is likely to be that another U.S. developed technology, key to the
production of advanced semiconductor devices, moves into the hands of a large
Japanese supplier and competitor to U.S. companies.
JUL-10-1990 08:50 FROM NIST DOC OFFICE
TO
94567739
P.14
STRATEGIC IMPORTANCE OF SEMI-GAS/HERCULES
PURIFICATION TECHNOLOGY
As the semiconductor industry moves to larger size chips and finer line widths, the
purity of the gases used in chip fabrication becomes ever more important. Gas
purity is a function of chemical technology in the creation and purification of gases,
and inherent cleanliness of the valves and piping systems containing those gases,
and the procedures by which the gas systems are operated.
For a variety of technical reasons, the purification of a process gas used in the
semiconductor industry, has proven to be an enabling technology. Purification, the
removal of unwanted chemical contaminants, allows processes critical to the
development of advanced semiconductors to be developed. Currently throughout
the United States there are substantial numbers of semiconductor research projects
underway to implement and fine tune these processes to enable the future technical
success of the U.S. semiconductor industry. Within the last 18 months, some of
these processes have moved to the production floor and are benefiting
semiconductor fabricators with enhanced yields and higher quality devices of greater
size and finer line widths.
World wide there are four firms involved in point-of-use gas purification
development. They are:
Competitors
Home Country
Semi-Gas/Hercules
United States
ATM/Millipore
United States
SAES
Italy
Nippon Pionics
Japan
Currently Semi-Gas has the major market share in the U.S. and a rapidly increasing
world wide customer base. In Japan, Nippon Pionics is the leading supplier of
purifiers while in Europe and the rest of the world purification is new to the
semiconductor market place.
In the divestuture of Semi-Gas Systems, Hercules proposes to license to the
acquirer the world wide rights to market their Nanochem® gas purification
technology and materials. If a Japanese firm acquires Semi-Gas Systems they
therefore will have the world wide lock on key technology to enable advanced
semiconductor process development. This event could make most semiconductor
maufacturers in the U.S., and perhaps the world, dependent upon technology that
is resident in one country outside of the U.S. This purification technology has been
proven by numerous researchers in the U.S., and Dr. Tadahiro Ohmi, a well known
Japanese semiconductor process researcher, has claimed Nanochem to be "most
nearly perfect".
JUL-10-1990 08:51 FROM NIST DOC OFFICE
TO
94567739
P.15
If this purification technology falls into the hands of a supplier who does not have
the interest of the U.S. semiconductor industry in mind, another key element in the
production of advanced semiconductor devices moves into the control of an offshore
company.
9.9,C MILLION $$ OF CABNTS & PURGE MNFLDS 87
:
88
:
89
:
90
I
90
:::
91
92
:
93
#
94
$
94
PRODUCED IN THE USA (NO IMPORTS)
MARKET
ESTIMATED SALES
MARKET
!
:
:
I
SHARE
:::
I
:
:
: SHARE
country of majority ownership in parenthesis 0
@
I
2
%
: :
:
-
:
:
%
I
4
I
B.
:::
:
:
:
is
SEMIGAS SYSTEMS
(usa)
:
10.00
:
12.70
I
16.90
1
20.10
I
46.10
:::
24.20
$
28.20
:
32.40
:
39.00
#
42.86
0661-01-701
I
=
:
#
$
111
:
$
=
AIR PRODUCTS
(usa)
:
4.00
:
5.00
:
8.00
:
10.50
#
24.08
: : 1
12.00
:
13.30
:
14.00
:
15.00
#
16.48
#
:
I
:
:::
:
:
:
:
AIRCO/ 80C
(britain) :
1.00
:
1.20
I
2.40
#
1.50
#
3.44
:::
1.50
:
1.80
:
2.50
:
4.00
$
4.40
I
t
:
E
$
: : 1
:
I
:
:
ASGT /AIR LIQUIDE
(france)
I
1.20
:
1.70
:
3.50
#
1.50
1
3.44
:::
2.40
I
3.00
I
3.50
:
5.00
:
5.49
08:51
#
I
t
I
$
: :
=
$
I
2
CAPCO
(usa)
1.00
I
.00
I
.00
I
.00
E
0 :::
.00
E
.00 #
.00 I
.00 =
0
I
#
2
:
:11
I
:
=
CREATIVE PATHWAYS
(usa)
-
.00
:
.00
#
.10
:
.20
:
.46
III
.30
:
.20
I
.10
:
.00 I
0
FROM
1
:
I
:
t
:::
$
:
$
:
FLOCON
(usa):
.50
:
.30
,
.00
:
.00
#
0 :**
.00 :
.00 :
.00 :
.00 2
0
I
:
$
I
:::
I
:
:
FLOPURE/UNION CARBIDE
(usa)
:
.30
:
.70
$
2.00
:
1.50
#
3.44
: : :
2.50
:
4.00
6.00
:
7.00
I
7.69
06AM
:
:
=
:
=
:::
:
:
1
=
MG SCIENTIFIC GASES
Queat:
.30
:
.20
:
.00
I
.00
#
0 ===
.00
#
.00
=
.00 $
.00 2
o
$
:
:
I
I
111
:
:
MATHESON/NIPPON SANSO (Japans
.40
:
.60
:
.80
1
3.00
:
6.88
::
4.00
:
9.00
$
13.00 :
15.00
:
16.48
I
#
#
:
$
: :
:
:
:
:
PRECISION FLOW DEVICES
:
.10
#
.00
I
.00
:
.00
:
o :::
.00
:
.00
:
.00
$
.00
=
o
=
:
:
:
:
:::
I
:
:
PROCESS & CRYOGENICS
(usa)
:
1.00
:
1.00
:
.70
:
.50
:
1.15
NIST DOC OFFICE
:::
.40
:
.00
I
.00
:
.00
:
o
:
:
=
=
:
: : :
:
:
:
=
SCI
(usa):
1.00
:
2.00
$
4.00
:
4.50
:
10.32
:::
3.50
:
5.00
:
6.50
:
6.00
:
6.59
I
,
:
:
=
***
:
I
I
:
SCIENTIFIC GAS PRODS
(usa)
:
.50
#
.40
It
.30
I
.10
:
.23
:::
.15
:
.00 I
.00 :
.00 =
o
#
I
:
:
:
:::
:
:
#
:
SILSCO
(usa)
#
.30
I
.30
I
.20
:
.20
:
.46
:::
.30
:
.30 :
.00
#
.00
I
o
I
$
:
:
:
***
t
:
:
$
SSE
(usa) :
.10
:
.00
*
.00
E
.00
I
0 :::
.00
:
.00
#
.00
:
.00
-
o
:
I
:
I
#
:::
:
:
#
:
VSM
(usa)
.10
:
.00
#
.00
:
.00
#
o ===
.00
:
.00
:
.00
:
.00
=
0
:
I
:
:
I
:::
1
=
:
:
VERIFLO
(usa)
#
.50
I
.30
.00
:
.00
0 :::
TO
:
.00
:
.00 :
.00
:
.00
:
o
I
:
:
:
:
:::
:
:
:
:
=
:
:
:
I
:::
:
:
:
TOTAL USA
c
:
22.30
:
26.40
=
38.90
:
43.60
:100.00
:::
51.25
I
64.80
:
78.00
:
91.00
100.00
#
Q.9.C
:
87
:
88
#
89
I
90
:
90
:::
91
:
92
:
93
#
94
#
94
MILLIONS ** CABNTS & PURGE MANIFOLDS
: MARKET
ESTIMATED SALES
MARKET
#
:
I
$
I SHARE
:::
:
:
:
SHARE
PRODUCED IN EUROPE (NO EXPORTS)
:
=
#
:
%
: :
I
:
:
:
%
I
%
:
:
:
: : I
:
:
:
:
2
:
:
#
:
: : :
,
:
1
I
SEMIGAS SYSTEMS LTD. (britai:
1.70
:
1.20
:
1.70
:
2.80
:
19.31
:::
3.50
#
5.00
I
6.50
:
7.00
:
25.41
:
:
:
:
:
:::
:
:
:
1
AIR PRODUCTS
(usa)
:
1.50
:
2.00
E
2.20
:
2.60
:
17.93
:::
3.50
:
5.00
:
5.70
:
6.70
:
24.32
:
:
:
:
:
:::
:
:
#
I
94567739
DRAEGGER
(germany)
.00
:
.00
:
.00 :
.20
:
1.38
: : :
.20
:
.00 :
.00
:
.00
:
o
:
:
:
:
:
:::
:
#
:
$
P.K. MUELLER
(germany) I
1.00
:
1.10
:
1.30
:
1.40
:
9.66
:::
1.00 :
.50 :
.20
:
.00
=
o
I
I
:
:
:
: :
:
:
:
BOC
:
(britain):
2.00
$
2.00
1
2.20
:
2.60
#
17.93
...
3.70
$
5.60
t
5.10
:
6.10
:
22.14
P.16
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
07a. Memo
Deborah L. Wince-Smith to Michael Skarzynski
7/9/90
(b)(1)
Re: Nippon Sanso/Semi-Gas CFIUS Invesigation (2 pp.)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
Withdrawal/Redaction Sheet
(George Bush Library)
Document No.
Subject/Title of Document
Date
Restriction
Class.
and Type
07b. Report
Re: Nippon Sanso (2 pp.)
7/9/90
(b)(1)
Collection:
Record Group:
Bush Presidential Records
Office:
Economic Policy Council (EPC)
Series:
Wethington, Olin, Files
Subseries:
Subject Files
WHORM Cat.:
File Location:
Science & Technology [2]
Date Closed:
1/5/2010
OA/ID Number:
04295-017
FOIA/SYS Case #:
2005-0336-F
Appeal Case #:
Re-review Case #:
Appeal Disposition:
P-2/P-5 Review Case #:
Disposition Date:
AR Case #:
MR Case #:
AR Disposition:
MR Disposition:
AR Disposition Date:
MR Disposition Date:
RESTRICTION CODES
Presidential Records Act [44 U.S.C. 2204(a)]
Freedom of Information Act - [5 U.S.C. 552(b)]
P-1 National Security Classified Information [(a)(1) of the PRA]
(b)(1) National security classified information [(b)(1) of the FOIA]
P-2 Relating to the appointment to Federal office [(a)(2) of the PRA]
(b)(2) Release would disclose internal personnel rules and practices of an
P-3 Release would violate a Federal statute [(a)(3) of the PRA]
agency [(b)(2) of the FOIA]
P-4 Release would disclose trade secrets or confidential commercial or
(b)(3) Release would violate a Federal statute [(b)(3) of the FOIA]
financial information [(a)(4) of the PRA]
(b)(4) Release would disclose trade secrets or confidential or financial
P-5 Release would disclose confidential advice between the President
information [(b)(4) of the FOIA]
and his advisors, or between such advisors [a)(5) of the PRA]
(b)(6) Release would constitute a clearly unwarranted invasion of
P-6 Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
personal privacy [(a)(6) of the PRA]
(b)(7) Release would disclose information compiled for law enforcement
purposes [(b)(7) of the FOIA]
C. Closed in accordance with restrictions contained in donor's deed of
(b)(8) Release would disclose information concerning the regulation of
gift.
financial institutions [(b)(8) of the FOIA]
(b)(9) Release would disclose geological or geophysical information
PRM. Removed as a personal record misfile.
JUL-09-1990 16:11 FROM UNDER SEC OF TECHNOLOGY
TO
94567739 P.06
SEMICONDUCTOR INDUSTRY ACQUISITIONS
"ACQUIRING THE CHAIN"
CHIPS
(ADVANCED MICRO DEVICES)
SILICON WAFERS
(MONSANTO)
MATERIALS AND EQUIPMENT
(MATERIALS RESEARCH CORPORATION)
MASKINGS
(TEXAS INSTRUMENTS)
CAPACITORS
(AVX CORPORATION)
I
HIGH & ULTRA PURITY POLYSILICON
(UNION CARBIDE)
SEMICONDUCTOR GAS PROCESSING/PURIFICATION
(SEMI-GAS SYSTEMS)
30 + CFIUS NOTIFICATIONS (ACQUISITIONS) HAVE INVOLVED
SEMICONDUCTOR-RELATED COMPANIES
JUL-09-1990 16:11 FROM UNDER SEC OF TECHNOLOGY
TO
94567739
P.07
AUTHOR UNKNOWN
ROUGH DRAFT
THE CHANGING FACE OF COMPETITION
IN THE GAS EQUIPMENT INDUSTRY
This draft attempts to capture the major issues of the acquisition of Semi-Gas
Systems by Matheson/Nippon Sanso and its impact upon the gas equipment and
purification industry.
1. Loss of American Exports. Currently Semi-Gas Systems, operating with
independence from a gas supplier, is the leading and perhaps the only exporter
of gas systems equipment to Europe and the Asia Pacific market place. The
suggested operating plan calls for Semi-Gas Systems to reduce its activities in
the Asia Pacific market in the very near future resulting in a loss of revenue
of approximately $3 million to $5 million per year.
2. Balance of Trude with Japan and Access to the Japanese Market. Semi-Gas
Systems has been working with several marketers in Japan to expand its market
share in the Japanese semiconductor industry. The acquisition brings with it
the restriction of independent Semi-Gas sales activity in Japan along with a
controlled access to the Japanese market through Nippon Sanso. The Japanese
semiconductor equipment market is the largest in the world and the proposed
acquisition will deny access to the Japanese market for the only viable U.S. gas
systems producer.
3. Loss of U.S. Technology Leadership. Currently Semi-Gas has a leading technical
position in the gas equipment market based on the automation technologies
within its Auto-Purge® family of products and the gas purification technologies
in the Nanochem® product family. Nippon Sanso has said that they wished to
take both of these technologies to Japan for further development for the
Japanese market. This can result in the Japanese semiconductor producers
receiving the latest product and technology improvements prior to making those
same technologies and improvements available to semiconductor manufacturers
in the rest of the world.
4. Loss of U.S. Income Tax Revenue. It is alleged that Nippon Sanso was able to
offer a substantially higher price for Semi-Gas Systems because their U.S.
subsidiary, Matheson, bas substantial tax loss carry-forwards. Semi-Gas, on the
other hand, has been profitable over the long term and if it remained
independent, would expect to pay $1+ million in income taxes over the next
several years. In effect, part of the financing of this acquisition has been
shouldered by the U.S. taxpayer.
JUL-09-1990 -16:12 FROM UNDER SEC OF TECHNOLOGY
TO
94567739
P.08
5. Loss of U.S. Market Share of Gas Equipment. With ASGT now owned by L'Air
T impride, Airco owned by ROC, and Semi-Gas owned by Nippon Sanso, only
Air Products and SCI are viable players in the U.S. specialty gas equipment
industry. This means that about 25-30% of the industry capability is U.S.
}
owned.
6. Focus on Japanese American Customers. Nippon Sanso's reasons for acquiring
Semi-Gas have been stated as, "desire to have a U.S. based producer to provide
equipment to the American factories of Japanese semiconductor producers".
Currently virtually all of Matheson's equipment sales are to U.S. factories of
Japanese producers.
7. Loss of Independence. Currently Semi-Gas Systems, as a non-aligned equipment
supplier, is able to work with all gas companies, world wide, without fear of
conflicts and cross purposes. The acquisition will lead to the end Semi-Gas'
relationships with Linde and BOC, which could dramatically lower the sales
success ratio of Semi-Gas.
8. Loss of Sematech. Semi-Gas Systems, as the first member of SEMI/Sematech
and as a key contributor to the gas team at Sematech, has been able to focus
its product improvement and product development strategies to rapidly develop
improved products to meet the needs of the industry. The close working
relationship between Semi-Gas and Sematech will be severed as a result of this
acquisition and it is very likely that Semi-Gas will find it difficult to remain
current with the needs of the semiconductor industry.
JUL-10-1990 08:46 FROM NIST DOC OFFICE
TO
94567739
P.06
parent company that intends to sell Semi-Gas to Nippon Sanso and this
corporation refused a buy-out offer from Semi-Gas management. Hercules
denigrated the quality of Semi-Gas technology and characterized it as soon-
to-be obsolete. Credible opposing technical views state this is not true and
these views were not considered.
(b) Testimony from SEMATECH, which has an ongoing R&D effort with
Semi-Gas that may have to be discontinued, was discounted as lacking
credibility and being ridiculous. SEMATECH represents a significant fraction
of the U.S. semiconductor industry. It receives $100M, one half its annual
budget, from DARPA; this is because the semiconductor industry has been
judged to be important to national security. Yet SEMATECH's claims that
were judged incredible were not separately investigated. Neither were the
effects of any setback in SEMATECH's efforts evaluated in relation to their
impact development. on the capabilities of member firms engaged in military systems
There are a number of other concerns, including the thoroughness of the
investigation, the adequacy of the technical qualifications of those involved in the
review, and the objectivity of the review, that raise questions that perhaps should
carry out our responsibilities.
not be ignored by Commerce. This is especially true if we are to conscientiously
There are important issues here that are larger than the CFIUS process. It is
appropriate for Commerce to go on record as opposing this sale on the basis of the
cumulative impact of sales of leading semiconductor materials and process
technology. Semiconductor technology is necessary for a capability in electronics,
on which virtually all defense weapon systems communication systems, command
and control systems, and other systems such as SDI depend. This is recognized by
others, which explains why this case has attracted attention in the press.
1 urge you to consider voting against approval of the final CFIUS recommendations
in this case, activating available mechanisms in the CFIUS process to document
Commerce concerns related to the cumulative trends in foreign acquisitions of U.S.
enabling technology firms, and working with me to develop a forum on such issues
competitiveness. as the relation among national security, economic security, enabling technology, and
cc: Wayne Berman
Juan Benitez
D/S Murrin
U/S White
07/12/90
16:47
NO. 109
P002
Table 1
Japanese Investments in Selected U.S. Electronics Industries
(Number of Transactions from 1980 to April 1990)
Industry
Equity
Acquisitions
Joint Ventures Total
Semiconductor
3
21
2
26
Materials
Semiconductor
10
8
7
25
Mfg. Equipment
Semiconductors
24
15
2
41
Telecom Equip.
6
9
1
16
Computer Systems
16
-
-
16
Computer Parts
15
16
3
34
and Peripherals
Computer Software
10
1
-
11
Total Japanese
84
70
19
169
Investments
Sources: Selected publications of the Office of Trade and
Investment Analysis, ITA, U.S. Department of
Commerce, the Japan Economic Institute, and the
American Electronics Association, Japan Office.
07/12/90
16:47
NO. 109
P003
Table 2
Japanese Investments in Selected U.S. Electronics Industries
(Number of Transactions)
1980-
1985-
4 Mths
Industry
1984
1989
1990
Total
Semiconductor
3
22
1
26
Materials
Semiconductor
1
21
3
25
Mfg. Equipment
Semiconductors
3
34
4
41
Telecom Equipment
3
11
2
16
Computer Systems
1
13
2
16
Computer Parts
6
24
4
34
and Peripherals
Computer Software
1
7
3
11
Total Japanese
18
132
19
169
Investments
Sources: Selected publications of the Office of Trade and
Investment Analysis, ITA, U.S. Department of Commerce,
the Japan Economic Institute, and the American
Electronics Association, Japan Office.
07/12/90
16:50
NO. 110
P002
Japanese Investments in Selected U.S. Electronics Industries
1, Semiconductor Materials
Japanese Investor
U.S. Company
Investment Type
Industry
Tama Chemicals
Moses Lake
Acquisition (1985) Hi purity
Chemicals
chemicals
Asani Diamond
Genasystems
50/50 JV
(1989) Thin-film
with GE
coatings for
semicond,
Shin-Etsu
Huls America
Equity
(1989) Photoresists
Handotai
Nippon Sanso
Matheson Gas
Acquisition (1989) Specialty
Products
Gases
Nippon Gaishi
Cabot Beryllium
Acquisition
Semi. mat.
Toshiba Ceramics
Quartz Internat'l
Acquisition (1986) Quartz/
pyrex mat.
Toson
Weiss Scientific
Acquisition (1989) Borosilicate/
quartz glass
Mitsui Mining
Allied Signal
50/50 JV
(1978)
Copper foil
for ICs
Nippon Mining
Gould
Acquisition (1988) Copper foil
for ICs
Furakawa Electric
Square D Yates
Acquisition (1989) Copper foil
Division
for ICe
Mitsui Hi-tec
International
Acquisition (1980) Leadframes
Leadframe Corp.
for ICE
Nisshin Steel
Thinsheet Metals
Acquisition (1985) Leadframes
Nippon Mining
Koltron
Equity-33% (1986) Leadframes
Kyocera
Ceradyne
Acquisition (1978) Ceramic mat.
Hitachi
Ceraclad
Acquisition (1989) Ceramic mat.
Asani Glass
Olin
50/50 JV (1986) Ceramic
substrates
Kyocera
AVX
Acquisition (1989) Ceramic
substrates
07/12/90
16:50
NO. 110
P003
Japanese Investor U.S. Company
Investment Type
Industry
Tokuyama Soda
General Ceramic
Acquisition (1989)
Ceramic
packages
Shin-Etsu
Hemlock Semicond. Equity-25% (1984) Polycryst.
Handotai/
Silicon
Mitsubishi Metal
Eduity-12%
Nippon Kokan
Great Western
Adquisition (1985) Polycryst.
(GE subsidiary)
silicon
Komatsu
Union Carbide
Acquisition (1990) Polycryst.
Division
silicon
Mitsubishi Metal
Siltec
Adquisition (1986) Silicon/
wafers
Showa Musen Kogyo T.A. Hand
Adquisition (1981) Silicon
wafers
Kawasaki Steel
NBK
Acquisition (1985) Silicon
wafers
Osaka Titanium
U.S. Semiconductor Adquisition (1987) Epitaxial
wafers
Osaka Titanium
Cincinnati Milac. Adquisition (1989) Silicon
Semiconductor Mat.
wafers
Toson
Varian Specialty Acquisition (1988) Sputtering
Metals
targets
Sony
Materials Research Acquisition (1989) Sputtering
targete
07/12/90
16:50
NO. 110
P004
2. Semiconductor Manufacturing Equipment
Japanese Investor
U.S. Company
Investment Type
Industry
Tokuda Works
Tylan Corporation
50/50 JV
(1986)
Etchers
Sumitomo
Lam Research
Equity-20% (1989) Plasma etch
systems
Marubeni Hytech
Ion Beam Tech.
Equity-12% (1986) Ion beam
Equipment
Sumitomo Heavy
Radiation Dynamics Acquisition (1986) E beam
Industries
accelerators
Canon
Lepton
Equity
(1987) E beam
patt. gen.
Fuji Electric
PPC
Equity-348
E beam
equip.
Sumitomo Heavy
Eaton Implant
J.V.
Implant
Equipment
Hoya
Micro Mask
Acquisition (1989) Photomasks
Topan
Texas Instruments
Acquisition (1989) Photomasks
Photomask Div.
Uemura
Industry
Automated
Acquisition (1989) IC plating
Semiconductor
Ulvac
BTU Internat'l
50/50 JV
(1989) Wafer proc.
systems
Tokyo Electron
Thermo
J.V.
SME*
Tokyo Electron
Lam
J.V.
SME
NEC
Anelva (Varian
Adquisition (1985) SME
subsidiary)
Samco
March
50/50 JV
(1986) SME
Sumitomo
GCA
Equity
(1987) SME
* SME- Semiconductor manufacturing equipment.
07/12/90
16:51
NO. 110
P005
Japanese Investor U.S. Company
Investment Type
Industry
Seki
Novellus Systems
Acquisition (1988) SME
Tokyo Electron
Varian
50/50 JV
(1989) SME
Nippon Sanso
Semi-Gas Systems
Acquisition (1990) SME (Pend.)
Hamamatsu
Inspex
Equity-80% (1978) Wafer
Photonics
insp. eq.
Nippon Steel
Holon
Equity
(1987) Wafer
insp. eq.
Mitsubishi
Si Scan Systems
Equity-25%
(1985)
Semi. test
equipment
Advantest
Integrated Circuit Equity-38%
IC testers
Testing
Advantest
Sym-Tek Systems
Equity-10%
(1988) IC testers
Sumitomo
LTX
Equity
(1990) IC testers
Advantest
Aenr Test
Acquisition (1990) IC testers
(pending)
07/12/90
16:51
NO. 110
P006
3. Semiconductors
Japanese Investor
U.S. Company
Investment Type
Industry
Sony
Vitelic
Equity
(1985) CMOS DRAME
Kyocera
Vitelic
Equity-108 (1987) CMOS DRAME
Oki
Vitelic
Equity
(1989) CMOS DRAMS
Exar (Ronm)
Excel
Acquisition (1986) EEPROMS
New Japan Steel
Simtek
Equity-25% (1987) EEPROMS
Sumitomo Metal
Standard Micro
Equity-20% (1986) ASICe
Yamana
Chips & Technol.
Equity
(1987) ASICs
TDK Corp.
Silicon Systems
Acquisition (1989) ASICs
Fuji Electric
Barvon BICMOS
Equity
(1988) ASICS
Toshiba/Mitsui
International
Acquisition (1989) ASICe
CMOS Systems
Toshiba
Integrated CMOS
Equity-14%
(1990) ASICs
Kubota
MIPS Computer
Equity-20% (1987) RISC MPUS
Fujitsu
VIA Technologies
Equity
(1989) RISC
chip sets
ASCII
Tera Microsystems
Equity-5%
RISC
chip sets
NTT
Photonic Integrat. Equity-49% (1987) Optoelectron.
Mitsubishi
Research (New co.)
Equity-41%
ICE
Batelle (U.S.)
Equity-10%
Nippon
Sheet
Epitaxx
Acquisition (1990) Optoelectron.
Glass
ICs
Mitsui
Gain Electronics Equity-40% (1986) GaAS ICs
Nippon Mining
Menlo Technologies Equity-30% (1989) GaAS
microwave
telecom ICe
Shin-Etsu Chem.
Brooktree
Equity
(1987) Graphics ICs
Ronm
Xetel
Equity-63%
(1986) IC design
Asani Chemical
Crystal Semi.
Equity-88 (1987) Analog ICs
Rohm
Exar
Acquisition (1971) ICE
07/12/90
16:52
NO. 110
P007
Japanese Investor
U.S. Company
Investment Type
Industry
Seiko Epson
Micro Power
Acquisition (1973) ICB
Toshiba
Marumon
Acquisition (1980) ICE
Seiko Epson
SMOS Systems
Acquisition (1983) ICs
Furukawa Electric
Bell's Computer
Acquisition (1988) ICe
Memory Division
Asahi Glass
Aegis, Inc.
Equity-498 (1987) Parts
for ICe
Mitsubishi Chem. EXXON Optical Info Acquisition (1981) Semi. laser
Systems Division
devices
Kobe Steel
GCA Laser Division Equity
(1986)
Semi. laser
devices
Mitsui
Zoran
Equity-5% (1987) Signal proc.
chips
Shizuki Electric
TRW Capacitor Div. Acquisition
Capacitors
Koa Denko
Speer Electronics
Equity-51%
Resistors
Fuji Kobunshi
Technical Wire
Acquisition (1989) Liq. cryst.
Kogyo
Prod. Division
connectors
Kyocera
Elco
Equity
Connectors
Mitsubishi
Powerex
Equity-33% (1985) Discrete
devices
Mitsubishi
Semicon
Acquisition (1986) Disc. dev./
PCBs
Sumitomo Bakelite
Sheldahl
Acquisition (1987) PCBs
Ricon
Panatech Research
Acquisition
Semiconduct.
Toppan Printing
Industrial Circ.
Acquisition
Semiconduct,
Toshiba
Westinghouse
50/50 JV
(1988) PCBs
Oki Electric
Hewlett Packard
50/50 JV
(1989) PCBs
Joppa
Prostar
Equity
(1990) PCBs
Hitachi
Kollmorgen
Acquisition (1990) PCBs
Division
07/12/90
16:52
NO. 110
P008
4. Telecommunications Equipment
Japanese Investor
U.S. Company
Investment Type
Industry
Fujitsu
Burroughs Imaging
Acquisition (1986)
Facsimiles
Systems Div.
Fujitsu
GTE Business
Equity-80% (1988) PBXs
Systems Div.
NEC
Tel Plus
Acquisition (1989) PBXs
Mitsubishi Elec.
Astronet Corp.
Bquity-25% (1984) Cellular
Mitsubishi
-24%
telephones
Kenwood
Hughes Network
50/50 JV
(1989)
2-way mobile
System
satellite
commun. eq.
Uniden
Magellan Systems
Equity-25% (1989) Satellite
commun. eq.
AWA
UVC
Equity-50% (1990) Video
communic.
Fujitsu
American Telecom
Acquisition (1980)
Telephone
equipment
Fujitsu
TRAN Telecom.
Acquisition (1980)
Telephone
equipment
NEC
AIM Telephones
Equity-10%
Telephone
equipment
NEC
API Telephone
Acquisition (1988)
Telephone
Systems
equipment
Sony
CXC Corporation
Acquisition (1988)
Telephone
equipment
Asani
Phonemate
Acquisition (1989) Telephone
equipment
NEC
MTI Business
Bquity-40% (1989) Telecom
Commun. Systems
equipment
Sharp
Hycom
Acquisition (1989) Telecom
equipment
Ancitsu
Wiltron
Acquisition (1990) Microwave
test equip.
07/12/90
16:52
NO. 110
P009
5. Computer Systems
Japanese Investor U.S. Company
Mitsui
Investment Type
Stellar
Industry
Equity
Graphics
Kubota
Ardent
supercomp.
Equity-25% (1987) Graphics
supercomp.
Equity-448 (1989)
Kubota
Stardent
Equity-228 (1989) Graphice
(merger of Ardent
and Stellar)
supercomp.
Yokogawa Electric
Supertek
Equity-16% (1989) Minisuper.
Fujitsu
Amdahl
Equity-46% (1973) Mainframes/
Equity-49% (1983) lge disk
storage
Hitachi
National Advanced
Equity-80%
(1989)
Mainframes
Sanyo Electric
Icon
Equity-40%
(1987) Supermini
Kyocera
Counterpoint
Equity
(1986) Workstations
Kubota
MIPS Computer
Equity-20%
(1987) Workstations
Matsushita
Solbourne
Equity-52%
(1988) Workstations
Canon
NEXT Computer
Equity-178
(1989) Workstatione
Nippon Kokan
Silicon Graphics
Equity-5%
(1990) Workstations
Fujitsu
Poquet
Equity-388
(1989) Sub-laptop
computers
Tosniba
Dynabook
Equity
(1989) Sub-laptop
computers
Nippon Steel
Synergy Computer
Equity
(1990) CAD/CAM
Graphics Corp.
systems
07/12/90
16:53
NO. 110
P010
6. Computer Components and Peripherals
Japanese Investor U.S. Company
Investment Type
Industry
Minebea
Hi-tek Corp.
Acquisition (1983)
Keyboarde
Minebea
Keytronic
Equity-30% (1986) Reyboards
Gunze
Graphics Tech.
Equity-50% (1989) Touch panels
Toshiba
Toshiba-Westinghse
$0/50 JV
CRTs
with Westinghouse
Nippon Chemi-Con
Data Ray
Acquisition (1983) Hi res.
video
display
TDK
Display Components
Acquisition (1987)
Components
(IBM/DEC supplier)
for hi res.
displays
Furukawa Electric Internat'l Compon. Acquisition (1988) Alum disk
Technology
blanks
Marubeni
Komag
Equity-5% (1985) Thin-film
disks
Kubota
Akashic Memories
Acquisition (1987) Thin-film
disks
Asani Glass
Komag
Equity-20% (1988) Thin-film
disks
Kobe Steel
Komag
Equity-20% (1990) Thin-film
disks
Hitachi
Trimedia
Acquisition
Thin-film
disks
Mitsubishi
Verbatim
Acquisition (1990) Floppy disks
Hitachi Metal
Systems Magnetic
Acquisition (1984) Voice coil
motors for
disk drives
Minebea
UMC Corp.
Acquisition (1984) D.C. motors
Minebea
IMC Magnetics
Acquisition (1985) Power
supplies
07/12/90
16:53
NO. 110
P011
Japanese Investor U.S. Company
Investment Type
Industry
Taiyo Yuden
Xentek
Equity-80%
Power
supplies
Minebea
Harris Miami Lakes
Acquisition (1985)
Switching
Division
regulators
Fujitsu
Intelligent
Acquisition
Storage
Storage
systems
Dai-Ichi Kangyo
Racet
Equity-30% (1984) Mass storage
Kobe Steel
Racet
Equity-10% (1987) Mass storage
Equity-51% (1989) systems
Japan Assoc.
Syquet Tech.
Equity
(1984)
Winchester
disk drives
Finance
Kyocera
LaPine Technology
Acquisition
(1987)
Magnetic
disk drives
Kubota
Maxtor
Equity
Magnetic
disk drives
Kubota
Maxoptic
25% JV
(1989) Optical disk
with Maxtor (U.S.) drives
Kawasaki Steel
Literal
21% JV
(1990)
Optical disk
with Kodak and
drives
Olivetti (Italy)
Kubota
Exabyte
Equity-8% (1987) Cartridge
tape drives
Nakamichi Corp.
Mountain Computer
Acquisition (1988) Cartridge
tape drives
Mitsubishi
Amtech
Equity-10%
Recognition
systems
Nippon Steel
GTX Corporation
Equity-21% (1987)
Automatic
drawing
recog. syst.
Hitachi
Dataproducts
Acquisition (1990) Printers
(pending)
Graphtec
Precision Image
Equity-41% (1988) Color
plotters
Kao Corporation
Sentinel Tech.
Acquisition (1988)
Computer
peripherale
07/12/90
16:54
NO. 110
P012
7. Computer Software
Japanese Investor
U.S. Company
Investment Type
Industry
Mitsubishi
Microrim
Equity-5% (1983)
RDBMS for
PCs
Computer Software Foothill Research
Equity-50%
(1986)
Software
Kubota
Synthesis Software
Equity-5%
(1988)
Software for
RISC systems
Yamaichi Univen
Integrated Systems
Equity
(1989) Software
Nikkei Info. Sys.
Excalibur Tecn.
Equity
(1989) AI software
Sony
Information
Equity-20%
(1989)
Network
Presentation Tech.
software
Chikyu Kagaku
Telemar Resources
Equity
(1989)
Image proc.
Sogo Kenkyujo
software
Kubota
Rasna
Equity-15% (1989) CAE software
Muton
Kurta
Acquisition (1990) CAD/CAM
software
Advantest
Knight's Tech.
Equity-15% (1990) CAD software
Dai Nippon Screen Island Graphics
Equity-79% (1990) Graphics
software