Commercialization of R&D Results Commercialization of R&D Results – ITRI Approach– ITRI Approach

X All-Siberian Innovation ForumX All-Siberian Innovation Forum

Dr.-Ing. Liang-Han Hsieh

General Director, International Business Center Industrial Technology Research Institute

Tomsk, October 10, 2007

2007/10/10 2

Essential role of Taiwan’s industry to the Essential role of Taiwan’s industry to the global digital economyglobal digital economy

#1 Provider of chip foundry services, with 70% of the market worth $8.9 billion#1 Provider of notebook PCs, with 72% of the market worth $22 billion#1 Provider of LCD monitors, with 68% of the market worth $14 billion#2 Provider of servers, with 33% of the market worth $1.8 billion#2 Provider of digital still cameras, with 34% of the market worth $2 billion#1 Provider of PDAs, with 79% of the market worth $1.8 billion

Data: Market Intelligence Center, Industrial Technology Research Institute

Key success factors - success comes Key success factors - success comes from concerted effortsfrom concerted efforts

Science-based industrial park Research and technology organizations Taiwanese/Chinese “Diaspora” Entrepreneurship and the inherent culture of risk-

taking Timing, market niche, highly intensive domestic

competition and expansion Financial mechanism, government funds, VC, stock

market, business angels, tax incentives IP protection International partnership

Copyright 2007 ITRI 工業技術研究院

2007/10/10 4

Missing link between universitiesMissing link between universities and industries and industries

Taiwan since 30 years

Fundamental Research

ApplicationOriented

FundamentalResearch

Applied R&D Technology Prototype

Pilot Production Prototype

Mass Production

Marketing

UniversityAcademia

Industry(SME)

RTO

Developed Countries

FundamentalResearch

ApplicationOriented

FundamentalResearch

Applied R&D TechnologyPrototype

Pilot ProductionPrototype

MassProduction

Marketing

UniversityAcademia

RTO Industry (SME)

2007/10/10 5

Some facts about ITRISome facts about ITRI

A not-for profit applied research institute established in 1973

An intensively interactive partner to local industry A mechanism for disseminating technology and

information to industries, and speed up commercialization of technology

The role of researchers and managers technology leaders / industrial leaders resource of talented people for industrial supports

Encouraging entrepreneurship

2007/10/10 6

ITRI’s role in Taiwan’s economic growthITRI’s role in Taiwan’s economic growth

Establishing new high-tech industries Technology transfer and enhancement: IC, Computer, Communications.

Upgrading capabilities and processes: Textile, bicycles, …Key components self-sufficiency: parts, technology

Development of industrial clusters Materials: photoresist, specialty chemicals (dyes, flame-retardant, etc.)Machinery and tools: car engines, tool centers, automation, control

Supply of high-quality human capitalHelp in policy formulation and implementation

(Future) : Develop new applications and business along leading-edge R&D

2007/10/10 7

ITRI - Innovating Technologies ITRI - Innovating Technologies for a Better Futurefor a Better Future

2007/10/10 8

ITRI operation at a glanceITRI operation at a glance

R&D Contract$245 million

Knowledge-based Services $220 million

49% 7%

44%

Manpower as of Nov. 30 , 2005Total : 5,428

Revenue : US$502 million (2005)(Government Sponsored Research Projects 49%)

From intellectual property$37 million

Master2,78751%

Doctorates

84615%

Others1683%Associates

60111%

Bachelors1,02619%

2007/10/10 9

Electronics and Optoelectronics

Advanced Manufacturing and

Systems

Biomedical Technology

Nanotechnology, Materials and

Chemicals

Information and Communications

100 nm

Scope of R&DScope of R&D

Energy and Environment

2007/10/10 10

ITRI contribution in dITRI contribution in developing eveloping human capital for the industrieshuman capital for the industries

ITRI’s Alumni in Hsinchu ScieITRI’s Alumni in Hsinchu Science-based Industrial Parknce-based Industrial ParkITRI “Alumni”ITRI “Alumni”

( 1973～ 2005.12) Total : 18,490

( 1973～ 2005.12) Total : 5,898

2007/10/10 11

ITRI contributed significantly in upgrading Taiwan ITRI contributed significantly in upgrading Taiwan to a technology powerhouseto a technology powerhouse

Establish the foundations of Taiwan’s semiconductor industryspin off the United Microelectronics Corporation (UMC) in 1979spin off the Taiwan Semiconductor Manufacturing Company (TSMC) in 1987

Breakthrough in flat-panel display technologies7 local TFT LCD makers and 4 color film makers were establishedwith investment of some US$ 3 billionhas reached the world-class level

Support the Information Industrystarted development of a basic input-output system (BIOS) for IBM compatible PCspowers Taiwan to become the world’s fourth largest producer of information industry products in 2001with a total output value of US$ 359.73 billion

Mechanism 1: Spin-off of Mechanism 1: Spin-off of technology development teamtechnology development team

Technology transfer

Technology adaptation

Spin-off

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• RCA technology transferred (1976)

1975 Year

• UMC: ITRI spin-off, 1979 1st 4” Wafer Fab in Taiwan

• TSMC: ITRI spin-off, 1987 1st 6” Wafer Fab in Taiwan

• VIS:ITRI spin-off, 1994 1st 8” Wafer Fab in Taiwan

• TMC: ITRI spin-off, 1988 1st Mask Company in Taiwan

• TSMC: 1st12” Wafer Fab in Taiwan, 2002

7μm 1.5μm 0.35μm 0.18μm 0.13μm 0.09μm 0.065μm

2000

Revenue: US$ 33.3 billion (2004)4th in the world─IC Foundry: 8 million wafers, Revenue US$12 billion, first in the world

linewidth

12” Wafer

ITRI and IC manufacturingITRI and IC manufacturing

2005

• Nursing• Clustering• Trend setting

2007/10/10 14

Four stages of Taiwan IC technology development

United Microelectronics→ Established basic technology

TSMC→Professional foundry services as strategic approach

Vanguard→Self brandname DRAM

SoC Design Center→Innovation-oriented

* UMC 80→ ERSO, RCA

* TSMC 87→ ERSO

I TI-Acer 87→ TI, IBM

I Winbond 87→ Toshiba Entered DRAM market in 1998

I Mosel Vitelic 87→ Siemens

I MXIC 89→ Matsushita Entered DRAM market in 1997

* Vanguard

94→ ERSO, Etron

I PSC 94→ Mitsubishi

I Nan Ya 95→ Oki, IBM

I ProMOS 96→ Siemens

I Rise 98→ Winbond ,Toshiba

Main technology sourcesITRI電子所ITRI

IC

FoundryIDM

DRAM

SoC

Source: ITRI (2004/03)

Milestones of Taiwan semiconductor industryMilestones of Taiwan semiconductor industry

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Fabrication, Wafer Probing and Dicing

WaferStarts

WaferSlicing

261 (-7) Fabless

4Leadframe

36 (+1)Testing34 (+1)

Packaging

4 Mask

8Wafer

MaskChip Design Packaging

19 Chemicals

Final Testing

13Fabrications

15Substrate

Backbone of the Taiwan IT industry -Backbone of the Taiwan IT industry -unique disintegrated infrastructureunique disintegrated infrastructure

Source: ITRI/IEK (2007/03)

2007/10/10 16

Source： ITRI/IEK(2006/03)

～

～

1985 1990 1995 2000

60

20

Market share (%)

U.SNo.1

U.SNo.1

TaiwanNo.2

TaiwanNo.2

CanadaNo.3

CanadaNo.3

ChinaChina JapanKoreaSingapore

•IP

•Innovation

•IP•Innovation

• Newly emerged• Domestic -driven Market

• Quick Tech follower

• Cost - down

• U.S & Taiwan together capture over 90

% of WW Market Share• Canada ranked as the 3rd largest fabless market

• Since 1996, fabless companies in Chin

a, Japan and Korea started booming

Fabless realizing IT innovationFabless realizing IT innovation

Mechanism 2: Joint development Mechanism 2: Joint development & technical supports& technical supports

Key components

Technology integration

Standardization

Industrial consortium

Human resources

2007/10/10 18

Taiwan optoelectronic industryTaiwan optoelectronic industry

1995 1996 1997 1998 1999 2000 2001 2003 2004 ...

CD-ROM

Scanner

FAX

LED

CD-R

TFT-LCD

PC Camera

MFP

MP3 Player

LCD Projector

LIGHT LED

Fiber Optics

PDP

HD-DVDDSC

Printer

DVD

8,58 Billion

1999 200532,65 Billio

n

Revenue (US$ Billion)

2007/10/10 19

ITRI’s role in Taiwan’s optoelectronic industryITRI’s role in Taiwan’s optoelectronic industry

Establishing DVD

verification lab

200019991998199619941992

Developing key components

CD-ROM: system integration

CD-R/RW disk: technology development

DVD disk drive: system integration & key component development Admitted to the

Steering Committee of DVD Forum

Establishing DVD Club

Unit: billion NT$

30

90

150

2001 2002 2003 2004

210

Establishing advanced storage consortium

HD-DVD: key component development

In 1993 Taiwan has no optical disk drive production, by 2001 its output of 50 million units accounts for 56% of the world market share.

Total revenues

2007/10/10 20

TFT/LCD: market share developmentTFT/LCD: market share development

0%

10%

20%

30%

40%

50%

60%

70%

1999 2000 2001 2002 2003 2004

Korea

Taiwan

Japan

Source： IEK (2005/5)

Taiwan shipment of large-size TFT-LCD increased by 38% within 5 years

2007/10/10 21

Glass Substrate

Glass Substrate

ITO GlassITO Glass Color FilterColor Filter PolarizerPolarizer Liquid CrystalLiquid Crystal Back-lightingModule(Unit)

Back-lightingModule(Unit)

Driver ICDriver IC

Corning TaiwanAsahi GlassNH-Techno TaiwanChina OptoelectronicsPicvue ElectronicsNEGT

Merck DisplayWintek、 CandoRitek

Sintek、 AMTCToppan TaiwanCando、 EverestChiMei、WintekINFO

Optimax、PolarayNitto opical 、Jantex、 SumikaTaiwan Panae

Merck TaiwanChisso

More than 20 companies, including ROEC、ForhouseKenmos、 K-BridgeNano-OP、 etc

HimaxUMC、 NovaTek Winbond Sunplus

TN LCD STN LCD TFT LCD

Module VendorsModule Vendors

More than 10 vendors, including Data International, Powertip Technology, Solomon Technology, Sharp, Hitch Electronics, Ampire, Data Image, Sunlike, Emerging Display Technologies.

Consumer Product Information Technology Product

Telecommunication Product Dashboard Product

Portable TelevisionVCD PlayerDVD PlayerProjector

Home Appliance Products,WristwatchesCalculators

Notebook ComputerLCD MonitorDigital CameraPDA

Mobile TelephoneAutomobile Navigation SystemsPagerVideophones

Industrial Equipment medical EquipmentAircraft Dashboard

Display Product

OLEDPDPFormosa PlasmaDisplay,CPT

Other

MaskMask

FinexPKLTHoya

2005.5

International partnership in International partnership in Taiwan FPD industry clusterTaiwan FPD industry cluster

Upstream Components

Midstream Panels

Downstream Applications

Rit Display、WinTekTeco ElectronicsDelta、 LTIOPTO Tech、 Univision

Wintek、Picvue ElectronicsMesostate, VDSUnited Radiant

CPT, WinTek, URTNan Ya OptoelectrinicsPicvue, Grand Pacific,Giantplus,Kaohsiung Hitachi

ChiMei, AUO, CPT, HannStar, Quanta,Toppoly, Prime ViewInnoLux

Mechanism 3: Technology transfer Mechanism 3: Technology transfer & joint development& joint development

International technology transfer

Technology adaptation

Joint development

2003 200520012000

MIRL/ITRIProposed research for further development and organizing research consortiumDarmstadt

Technology transferred to MIRL/ITRI

Research Consortium9 companies + 4 univ., MIRL and PMC

2005 Taipei International Machine Tool ExhibitMore than ten types of new machine tool exhibited.

MIRL spin-offA spindle company, with capital 100 Mio. NT, will be spin-off from MIRL/ITRI (20-25 employees)

Linear-drive machine tool developmentLinear-drive machine tool development

1584 Mio. USD 2890 Mio. USD

Mechanism 4: Value creation and Mechanism 4: Value creation and enhancement in global contextenhancement in global context

Road mapping

IP deployment

OpenLab

Incubation

2007/10/10 25

Global market share for Taiwan’s ICT productsGlobal market share for Taiwan’s ICT products

World Market Share (units)

Source:IEK/ITRI(2005/05)

2003

2004

Made by Taiwan

Made in Taiwan

Made outside Taiwan

2007/10/10 26

OEMOEMTotal Systems

& ServicesTotal Systems

& Services

Brand nameProducts

Brand nameProducts

ODMODM

Transition of industrial value chain in TaiwanTransition of industrial value chain in Taiwan

Needs to pursue down the value chain

Efficient Mass Production

Novel Products/ Systems/ Services

2007/10/10 27

Strategic thinking: focus on value creationStrategic thinking: focus on value creation

TechnologyR&D

Needs (Products & Services)

Business Development & New Venture

Innovation & Differentiation

Linkage of Needs to Innovative Technology

Differentiation & IP-Driven

Early-stage Business Development

Creating Value rather than Creating Technology

2007/10/10 28

IndustrialIndustrial Technology R&D Technology R&D

IP Business & IP Business & New VenturesNew Ventures

Tech. & Knowledge-BasedTech. & Knowledge-BasedServicesServices

R&D based on needs R&D based on needs

Expectations from consumers: mobility, flexibility, individualism, multi-function

Megatrends: Aging population, resource limitation, globalization, knowledge-based economy

2007/10/10 29

Organization alignment accentuating value Organization alignment accentuating value creationcreation

Make or buy: international business developmentStrategic partnersITRI Lab@X Overseas co-incubator (Venture Acceleration Sphere)

Stepwise focusing: Core labs: buildup of multi-discipline capabilitiesFocus centers: Clear market goals Linkage centers: Coordinate/integrate various efforts

Cut & paste: IP deployment for industryEntrepreneurship: by encouraging spin-offs and incubating young entrepreneurs and start-ups at OpenLab@itri and own incubators

2007/10/10 30

ITRI Open Lab (Since July, 1996)ITRI Open Lab (Since July, 1996)A conducive environment for industries to

access ITRI R&D resources

Joint R&D Programs for existing companiesJoint R&D Programs for existing companies

Incubation of High-Tech StartupsIncubation of High-Tech Startups

As of Dec. 2005, 227 projects completed, 135 new companies formed with total capitalization of US$1.46 billion

An internationally recognized success 2005 AABI Award - Asian Association of Business Incubation 2006 NBIA Randall M. Whaley Incubator of the Year - Nation

al Business Incubation Association (U.S.)

2007/10/10 31

Globalization: Solutions to the Globalization: Solutions to the challengeschallenges

Global Bridge (Openness)Connecting to worldwide resources, opportunities and challenges

Global Brain (Innovation)Open for worldwide innovation and talents

Global Brand (Value)Buildup own unique positioning and capabilityIntegrate or be integrated globally to create value

Source: Taiwan 2015 Vision

2007/10/10 32

Global operation strategiesGlobal operation strategies

Western European Office

Moscow Office

Tokyo Office

ITRI Int’l Inc.•Academies•Universities

•Outsource

• Industrial alliance

•Strategic partners

•Multinationals•VAS

•RTOs•Universities•Multinational

India

•APEC•…•…

SE Asia

•…•…

MiddleEast

2007/10/10 33

Milestones to ITRI-Tomsk cooperationMilestones to ITRI-Tomsk cooperationPresentation on Taiwan’s innovation system (May 2005) Agreement RFBR-Tomsk-ITRI signed (October 2006)

Innovation projectsInnovation projectsHuman resources trainingHuman resources training

Russia-Taiwan High-Tech Forum 2006 (October 2006)Visit of ITRI delegation in Tomsk (March 2007) for

Industrial cooperation (UPI) and ITRI ITRI incubation program for students from Tomsk Universitiesincubation program for students from Tomsk Universities

Visit of RFBR delegation (May 2007)Proposal for LED and innovative lighting system cooperation (HongHai, May 2007)Visit of ITRI delegation for student exchange program (June 2007)Visit of Tomsk State University delegation (July 2007)X All Siberian Innovation Forum 2007 (October 2007)Proposal for student exchange program and innovation technology cooperation (October 2007)

2007/10/10 34

Thank You for Your Attention! Thank You for Your Attention!

http://www.itri.org.twhttp://www.itri.org.tw