NEWSLETTER - JANUARY / FEBRUARY 2004

PRIORITISING INVESTMENTS IN TECHNOLOGY DEVELOPMENT

Globally, the electronics industry generates more added value than any other manufacturing sector. With a market of some $ 800 billion, it is now bigger than the worldwide automotive industry. Microelectronics manufacturers and related equipment and materials suppliers represent currently nearly 1% of global GDP with an average annual growth rate of 15%. And the many industries that depend on electronics - such as telecommunications, Internet services, consumer products, defence and aerospace - their overall weight is several times higher at an estimated € 5,000 billion. However, better planning is essential to ensure that Europe continues playing a leading role in the global industry. MEDEA+ has therefore developed an Applications Technology Roadmap to enable a better prioritisation of investments in relevant technology development.

Current investment in electronics accounts for some 30% of overall industrial investment, a tremendous increase since 1960 when it was less than 5%. Electronics are playing a vital role in the transformation of our society, with access to the Internet, mobility and e-commerce contributing to removing social and cultural barriers and to bringing every citizen into the information age, with direct benefits to health care, welfare and the environment.

Information and communication technologies (ICT) are transforming the way we live, learn and play, with ICT hardware and software costs now representing more than one-quarter of the total expenses on services. And electronics equipment including safety, engine control and anti-pollution systems represents around 20% of the direct production cost of a family car, and even more for high-end vehicles.

In addition, as recent advances in nano-scale technologies lead to mass markets by the end of the decade, other industries will be able to benefit from the high technology experience and low cost mass manufacturing expertise developed for nanoelectronics systems. The result will be increased demand for highly qualified workers, improved quality of life through safer and better performing products incorporating electronic chips and intelligent nanosystems, and a more efficient use of materials leading to a better environment for all.

Two main challenges face the electronics industry :

1. Achieving major technical breakthroughs to overcome the 'red brick wall' represented by apparently insoluble problems in obtaining higher complexity and greater integration; and

2. The high cost of investments in research and production facilities needed to make the necessary step changes in technology. This continues to lead to industrial concentration and clustering that should be firmly anchored in Europe.

Facing up to these challenges is not cheap. Some 40% of the annual sales of semiconductor companies are reinvested in R&D and improved production processes. Since 1994, the R&D spending by the European microelectronics industry has steadily increased and recently the R&D costs of European semiconductor manufacturers were close to 19%, one of the highest worldwide.

Close co-operation at international and national level through pan-European initiatives such as the R&D co-operative programmes launched as part of the EUREKA JESSI initiative, followed by MEDEA and now MEDEA+, are therefore increasingly essential to ensure that European microelectronics researchers, manufacturers and related materials and equipment suppliers maintain a competitive world class position. This is the only way that Europe can afford to compete with co-ordinated initiatives elsewhere - such as International Sematech in the USA and Selete in Japan.

The new MEDEA+ Applications Technology Roadmap (ATRM) has a key role to play in achieving this co-ordinated view by identifying those enabling technologies that must be mastered on time to enable mass production to satisfy identified user needs in 2012. Development of these technologies would become the basis for future R&D programmes, in particular for MEDEA+ and its successors.

While the ATRM addresses many areas already covered by MEDEA+ - such as fixed and wireless communications, consumer electronics with multimedia and Internet capabilities, automotive electronics with communications and engine management, smart cards and associated security and safety solutions, it also looks at new uses in health, education and comfort outside the current scope of MEDEA+.

The roadmap is intended for a wide variety of users, including :

• The MEDEA+ organisation itself, as we prepare future programmes and calls;

• Programme managers of collaborating consortia to create and fine tune their new project proposals;

• Industrial managers to relate in-house roadmaps to our wider European view;

• Public authorities to align their programmes to the industrial needs we have identified;

• Strategy and marketing managers to check their future product strategy in the applications areas covered; and

• Individual researchers in industry and academia to find interesting new subjects for research;

In conclusion, it should be highlighted that :

• Electronics accounts for a large and growing market, supporting other industries and contributing to the solution of 'society needs', such as health, safety and security.

• R&D and innovation are essential to keep the competitive position.

• ATRM is key in planning required developments. The following article provides more insight on the MEDEA+ ATRM approach?