The Nanotechnology Opportunity Report (and Millipedes)

IBM Millipede nanotechnology

The seminal work on nanotechnology, the Nanotechnology Opportunity report is finally available for free. While it was credited with launching the nanotechnology industry and a thousand start ups it used to cost a lot of money, but now it doesn’t and you can download it here. Download

One feature which stands out from 2003 is the futility of trying to calculate market sizes for technologies that don’t exist. Predictions are always wrong but we probably called it right as a ” teeming collection of technologies and applications seeking each other.” It’s a nice metaphor and one that is applicable to any speculative technology, from graphene to wearables.

While there was some irrational exuberance about technologies such as IBMs fabled millipede, I think we got a lot right. Here’s the market overview from 2003 and you can now judge for yourself what we got right or wrong.


The word ‘nanotechnology’ has gone from being known only by scientists and a group of investment-minded individuals hoping it would be the next big thing, to a widely-known term that means very different things to different people. While some businesses see it as a wake-up call to understand something that could affect them dramatically, others see it as the next big hype and yet others see in it the impending destruction of our planet. A few die-hards still want to see it as the latest get-rich-quick bandwagon to jump on, but most of those who felt that way a year ago have jumped off the bandwagon or changed their tune. Apart from the fears of Armageddon, a certain amount of reality has settled in.

Meanwhile, nanotechnology has continued its steady advance towards commercialization in many areas, having generally small but significant effects on the world around us. The fact that our world has not been transformed, creating a new generation of millionaires along the way, has been taken by some as evidence that it is all just hype. In the first version of this report, however, it was made clear that, though we are looking at a revolution here, it will be a gradual one. The majority of effects will be incremental and many will be some time coming.

This is not to say that there won’t be some revolutionary changes. There will. Some of these are looking quite certain and quite close, others are less certain or will take a little longer to arrive. There are also surely others that have not yet been anticipated.

The myth of the nanotechnology market, or the hunting of the Snark

One of the most striking features to emerge over the last 12 months is the widespread acceptance and dissemination of the National Nanotechnology Initiative’s estimate of a $1 trillion nanotechnology market by 2015. While this has excited everybody from venture capitalists through governments to entrepreneurs and academics, such estimates need to be taken with a rather large pinch of salt. In common with Lewis Carroll’s masterpiece of nonsensical verse, The Hunting of the Snark, a motley crew is in search of an elusive prey.

Nanotechnology will affect almost every market either directly or indirectly.  In some cases, and this will be easy to prove with 20/20 hindsight, markets will be disrupted. However, in many cases nanotechnology can be seen as a way of making incremental changes to existing markets or enabling the creation of new markets.

Given that the technology will affect all markets, how can one size the market? The simple answer is that we cannot in any sensible way, but fortunately we do not need to even try. The concept of a ‘nanotechnology market’ is an essentially meaningless concept, in the same way that the size of ‘the Internet market’, if one could decide how to calculate it, would be of no relevance to most people in the business community. Most businesses simply want to know the market potential for a specific product, service, or technology, in the same way that most people involved with ‘the Internet’ require market sizing for a specific piece of hardware, software, or product that will rely on the Internet.

A Fourier analysis of nanotechnology key drivers

The trillion dollar market is an example of the natural urge of many people to try and simplify a complex world, and their tendency to do so to the point of absurdity. To give another example, it is common practice to simplify the adoption of new technologies into a simple S curve. While these may be of use to economic historians, the reality, especially during the early phase of any technology, is very different and also looks far more complex. Just as for a market to exist for any advanced technology products, a whole house of cards has to be built of other technologies and infrastructure that would allow that one market to exist. A similar process occurs with adoption. Rather than a single S curve, what is happening is that a series of S curves is being produced by the various applications of nanotechnology, adding up to what may appear to look like random noise.

In exactly the same way that Fourier analysis allows any electronic signal to be broken down into its component parts, and the strongest components identified, an analysis of the whole nanotechnology landscape allows the key drivers to be identified.

The Nanotechnology Opportunity Report provides the most comprehensive overview of all of the varying signals that make up the currently very strong signal known as nanotechnology.

The reality of the nanotechnology market

What exists, and what the Nanotechnology Opportunity Report portrays, is a teeming collection of technologies and applications seeking each other. The technologies are the building blocks that will change the dynamics and cost structure of product sectors that exist today, and those that will be created. However, the best technology, or the most promising company will not necessarily win.

There are many powerful drivers behind nanotechnology. There is an unprecedented scale of government funding, backed by equivalent corporate R&D funding, and a rapidly growing amount of investment capital. Equally, the convergence of traditionally separate scientific disciplines that nanotechnology represents is proving enormously fertile. This can be combined with the fact that nanotechnology is advancing on numerous fronts simultaneously, often competing in the same space, to present a future of remarkable volatility, in which new industries will be born, old industries may collapse, and the well-informed investor will have a multitude of opportunities. While there may not be a ‘nanotechnology market’, there is some value, at least for the time being, in talking about a nanotechnology sector.


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