The following HTML text is provided to enhance online
readability. Many aspects of typography translate only awkwardly to HTML.
Please use the page image
as the authoritative form to ensure accuracy.
MAKING IT BETTER: EXPANDING INFORMATION TECHNOLOGY RESEARCH TO MEET SOCIETY'S NEEDS
ciation of University Technology Managers (AUTM) reported that, since 1980, more than 2,200 companies had been created to commercialize the results of research conducted in U.S. and Canadian universities, research hospitals, and other research institutions (AUTM, 1998). Almost half of those companies had been created since 1993. In 1997, 258 of the 333 startup companies in the survey came out of university research. In 1996, only 248 start-ups were reported by all the institutions combined. Although the number of start-up companies is increasing, the percentage of technologies licensed to start-up (as opposed to established) companies is decreasing. From 1977 to 1993, 50 percent of licenses were granted to start-up companies. Since 1993, only 29 percent of licenses were extended to start-up companies, and 61 percent were extended to existing companies. The implications of this trend are as yet unclear, and further study is needed; the trend could signify greater recognition within established companies of the value of university research, or it could suggest established companies' growing dependence on university research.
The IT industry is home to a large number of firms that emerged from university research. Stanford University, for example, gave rise to a number of well-known Silicon Valley companies, including Sun Microsystems and Cisco Systems. MIT also gave rise to a number of firms, ranging from Open Market, Inc., an e-commerce firm, to RSA Data Security, which specializes in public key encryption, and more recently Akamai, which streamlines the downloading of content from popular Web sites. The AUTM survey reports that MIT contributed to the creation of 17 start-up companies in 1997, second only to the University of Washington, with 25. A report by BankBoston found that MIT graduates and faculty had been involved in founding 4,000 companies that employed 1.1 million people and had annual world sales of $232 billion in 1995; 57 percent of the employment resulted from firms in electronics and instruments (BankBoston, 1997). Carnegie Mellon University has licensed technologies to many small software and robotics companies, as well as LYCOS, one of the well-known players in the Internet search engine market.
The characteristics of start-up companies that arise out of academia vary significantly among universities. For example, both Stanford and the University of California at Berkeley have provided many new technologies to Silicon Valley, but their approaches are quite different. Berkeley professors have tended to remain in academia. At Stanford, by contrast, “it's almost expected that a successful faculty member will at some point start a company” (Hamilton and Himelstein, 1997), although an individual may return to Stanford after the company is well launched. Berkeley's style is to “develop technology, convince existing companies to use the ideas, and then go back and develop more technology” (Hamilton and Himelstein, 1997). This pattern seems to be changing