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10. Small Technology

Computer displays you can tote around with one hand? Plastics almost as strong as steel? Improved drug efficacy? Micro-managing finally pays off.
Marie Leone, | US
October 4, 2002

Brief: Odds are, small technology will end up being a big deal to corporate executives. In fact, the pervasive and transparent integration of small technology into business over the next five years will absolutely reinvent processes and production methods. Indeed, the unprecedented control over atomic particles will help create new markets, improve ROI, and bring about new materials.

What It Is: "Small tech" is the catch-all phrase for MEMs (microelectromechanical systems), microsystems, and nanotechnology. But CFOs shouldn't fret about deciphering the physics of this tiny triad, says Rick Snyder, CEO of Ann Arbor-based Ardesta Inc., a holding company that partners with, and invests in, small-tech companies. Instead, finance executives should focus on the ways small technology reinvents business models and corporate supply chains. By the way, "small" is defined as less than the width of a human hair.

Skinny: Experts believe that small tech will push the "smaller, faster, better, cheaper" IT revolution to a new level. Witness Kodak's glowing plastic molecules — officially called organic light-emitting diodes (OLEDs). Unlike liquid-crystal displays (LCDs), OLEDs are self-luminous and therefore don't require backlighting.

Invented nearly a decade ago, OLED applications are just now seeping into the high-end flat-screen monitor and handheld device market. But those thinny-thin screens will one day — and one day soon — come to dominate the scenery at most corporate offices. And while it may not seem overly dramatic, cheap flat-screen displays will free up office space, improve the efficiency of workers, and eliminate worker worries about harmful radiation emanating from cathode-ray-tube monitors.

OLED technology will also be good news for workers who use their cell phones a lot. Soon those portable phones will boast displays that rival the picture quality of high-definition television sets. What's more, the viewing angle of cell phone screens will improve (up to 160 degrees, to date), as will the response time, brightness, and color of the screens. What will drop? Power consumption and weight.

In other areas, small technology is already bolstering corporate returns, say research analysts Mike Mitchell and Andy Jones of London's Evolution Beeson Gregory Ltd., an investment bank that invests in small tech companies. They point to Inhale Therapeutic Systems as one example of a small-tech company that helps pharmaceutical giants recoup drug development and marketing investment — which can climb to the $3 billion range.

Inhale Therapeutic relies on small technology (manipulation of peptides and proteins) to enhance the delivery performance of a drug — without actually changing the chemistry of the drug. That enhancement, in turn, reduces the doses a patient has to consume. Mitchell contends that less frequent dosages are an enormous marketing advantage, considering that drug manufacturers lose 90 percent of their revenues once the patent for a drug expires.

The manufacturing sector will also benefit mightily from small technology. For instance, nanocomposites, a new class of super-strong, super-light plastics formed by rearranging molecules. Materials made from nanocomposite plastics will be far superior to more traditional plastics, with improved flame resistance and thermal and structural properties. That's why car manufacturers like Toyota and General Motors are finding uses for these pumped-up plastics in cars currently under design. And, according to officials at nanocomposite maker Nanocor Inc., the new plastics will find their way into everything from sneakers and lawnmowers to electrical enclosures and car running boards. Even better, most manufacturers won't have to purchase special equipment or dramatically change their manufacturing processes to use many of these new materials.

And oh, yes: Once computer storage companies figure out how to cost-efficiently store data on super-small crystals — and they're working on it now — expect to see a revolution in corporate computing, business intelligence, and data mining.

ETA: Five years.