I would have sworn on Prolife's bible that Shrub promised that he was going to unite the American people, grow our economy and make us a World LEADER in innovation and technology....
Shrub! What has happened to your promises...that is other than making your crooked CEO friends rich.
This is scary....just think what this is telling our future generation of children that want a job....
"Dow Jones Business News
US Innovation Threatened; Silicon Valley Companies Cut R&D - FT
Sunday September 29, 8:07 pm ET
TOKYO -(Dow Jones)- The worst recession in the history of the information technology sector has forced leading companies in America's Silicon Valley to cut back on research and development, the Financial Times reported on its Web site Monday.
The decline may hit U.S. innovation more broadly, affecting the productivity growth that underpinned the rapid growth of the U.S. economy in the second half of the 1990s. Innovation in the IT industry is already under threat from a sharp collapse in investment by venture capital groups, the report said.
Data compiled by the FT show that the 30 top Silicon Valley IT companies cut their R&D spending during the first six months this year by an overall 5% to $ 11.9 billion from $12.5 billion.
The fall also raises questions about Silicon Valley's ability to remain the world's centre for technological innovation. California spends the most on R&D of all the U.S. states.
"Silicon Valley will never be the same," warned Larry Ellison, chairman and chief executive of Oracle Corp. , the valley's largest software company. " Those who believe this is merely a cyclical downturn are mad. They cannot see what is happening in front of their eyes. Our industry is going to mature and as something matures, the rate of innovation does slow," he said in an interview with the FT.
According to the FT data, a majority of the groups - 16 - reduced their investment, while 10 increased R&D. Four companies left their spending unchanged.
Among those that cut R&D were Sun Microsystems Inc. (NasdaqNM:SUNW - News) , Cisco Systems Inc. (NasdaqNM:CSCO - News) and Agilent Technologies Inc. (NYSE:A - News) , although a number of big companies, such as Intel Corp. (NasdaqNM:INTC - News) and Applied Materials , raised spending.
The downturn in spending is particularly alarming because since 1960 American industrial spending on R&D has never fallen, according to the U.S. National Science Foundation.
"This is a worrying development," said Dan Wilson, economist at the Federal Reserve Bank of San Francisco. "Corporate R&D spending is very important for innovation and has been shown to be closely correlated to productivity growth."
Wilson said the downturn in R&D spending was partly cyclical, the result of the economic downturn.
IT revenues tumbled 12% in the first half, hit by a collapse in corporate spending, according to Vadim Zlotnikov, technology strategist at Sanford Bernstein. Many IT groups have responded to falling sales by slashing costs, including R&D.
But Wilson warned that this year's slowdown in R&D spending growth has been much deeper than during the 1991 recession. "This is worrying because this economic downturn has been much milder than in 1991."
Other sources of R&D funding are also down sharply. The amount invested in Silicon Valley by venture capitalists during the first half this year tumbled 50% to $3.9 billion from $7.85 billion, according to PriceWaterhouseCoopers/ Venture Economics.
One indicator of the rate of innovation - patent applications - is already showing a marked deceleration. Forecasts by the U.S. Patent and Trademark Office suggest patent applications this year are likely to increase by just 1.3%, compared with more than 10% in every other year since 1996. |
