Research gap threatens innovation, experts warn

Research gap threatens innovation, experts warn

MOUNTAIN VIEW, Calif. – The innovation pipeline could run dry from a lack of federal funding in basic research and the decline of big corporate R&D labs, said a panel of experts at an event celebrating the 40th anniversary of Ethernet.

They lamented the loss of AT&T Bell Labs that gave birth to the transistor and the decline of Xerox PARC, the birthplace of Ethernet. By contrast many of today’s largest tech companies, such as Apple—accused by Congress this week for failing to pay taxes on billions in revenue—conduct virtually no basic research, they said.

“When I was at Xerox people were not preoccupied with raising millions in VC funds-- we had free reign to make breakthroughs come true,” said Yogen Dalal, a managing director at the Mayfield Fund who wrote a seminal paper on Ethernet in its early days. “You have to have breakthroughs, but today who will fund them,” he asked.

“The thing that concerns me the most is we have lost the lead in big industrial research—we would never have had the transistor without Bell Labs,” said Bill Spencer, former head of PARC and Sematech. “The U.S. still has the best university system in world, and it’s still the best place to bring new things to market, but the middle missing,” he said.


Bill Spencer led PARC in the early days of Ethernet.

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