Russia's parliament recently pledged $7 billion for a state-owned nanotechnology corporation, a move that has the backing of Russian President Vladimir Putin. Another strong supporter of Russia's funding measure? Scott Rickert, CEO of Nanofilm Inc., a Valley View, Ohio-based developer of surface care products based on nanotechnology.

"I wish (the Russians) the best," Rickert says. "There's always got to be a number two, and the competition is good for business."

It's a testament to the state of the nation that such a free-market sentiment sounds so out of place in today's climate of cutthroat global competition and pushes for protectionist policy. However, innovators like Rickert and the community he represents truly believe that the U.S. stands at the top of the "small world" of nanotech, and has the potential to maintain a large stake in an emerging technology that analyst firm Lux Research places at topping $2.6 trillion in new products and services by 2015.

A "Natural Advantage"

As Rickert sees it, the added vigilance that U.S. regulatory agencies require hasn't stifled innovation; instead, it makes for an environment of global trust that contrasts U.S. companies with the competition. "We have the best quality and purity control of any country in the world," he says. "We see that as a big commercial advantage."

The Next Frontier Of Innovation

The United States has more nanotech companies across more sectors than any other country and leads the world in nanotech patents and highly cited publications, according to Sean Murdock, executive director of the Nanobusiness Alliance.

Maintaining this lead is absolutely crucial, Murdock says, for three main reasons:

"One, because of its transformative nature, nanotech will provide the potential for less-developed nations to leapfrog the U.S. as a global economic and military powerhouse.

"Two, we cannot afford to hold anything less than a commanding leadership position not only in nanoscience research, but in the commercialization and translation of that research.

"Three, U.S. manufacturers will not win when competing on cost structure. We compete best based on innovation, and the next frontier of innovation across almost every sector is based on nanotechnology."

Murdock suggests that interested parties should contact their Congressional representation to express support for the reauthorization of the 21st Century Nanotechnology Research and Development Act, which is scheduled to expire next year.

Pankaj Dhingra, CEO of Redwood City, Calif.-based Nanostellar Inc., a maker of nano-engineered catalyst materials, agrees that U.S. companies enjoy a certain "natural advantage," citing the dynamism of the U.S. capital markets and the entrepreneurial spirit of the business population as the cause. "With any new technology, you need a culture of risk where people have the fire to go out and start their own companies, and a pool of funds to enable that to happen," he explains. "That's the big advantage of the American economy -- along with the government funding for research, we have a pool of private companies and entrepreneurs that can commercialize that research and take it to industry."

For an example of how U.S.-based nanotech companies can pave the way to a value-added future, consider the transformation of Akron, Ohio-based Ecology Coatings from a conventional metal finisher into a pioneer in the integration of clean tech and nanotech, with four issued patents (nine others are in the patent pipeline) and licensing deals with the likes of chemical giant DuPont.

President and COO Tom Krotine marks 2002 as the turning point, the year that Ecology Coatings started looking at integrating nanomaterials into its proprietary formulations. "It was a decision based out of necessity more than anything," he remembers. "We had particular needs for a customer in terms of hardness and clarity, and only nanotech could solve those problems."

Since that first successful step, Krotine and Ecology Coatings co-founder Sally Ramsey have shepherded the company's nanotech R&D efforts toward incorporating some of the other value-added benefits of these materials into the value chain.

"The basis for our paint patents is that they're stable and durable," Krotine says. "Usually, when you incorporate nanomaterials into coatings, they tend to clump, but our formulations maintain their discrete nature. This gives the product a longer shelf-life," he claims. "You can take them out, mix them up and spray them years later."

Better, Cheaper, or Both?

Despite the advantages to companies big and small, Rickert says that nanotechnology is only now being consistently considered as one of the possible options to solve a problem or develop a product. However, he has no doubt that many new products, or newer versions of existing products, will either incorporate or be coated with nanotechnology.

"It has to be cost-effective and offer value, but that's true of any material choice that you might make," Rickert observes. "You can now go back to developing the next version of whatever you sell, and ask, 'How can I use nanotech to make it better, or cheaper? Or both?'"

The pharmaceutical industry is certainly taking notice of nanotech. With the patents protecting $16 billion of market share scheduled to expire this year alone, and 60% of so-called "blockbuster patents" expected to expire by the end of the decade, drug makers are looking hard at nano-engineered reformulations -- a development that has enormous potential to help both the companies and the patients they serve.

"One of the problems with cancer drugs is that, over time, patients become immune to them," says nanotech industry analyst Jack Uldrich. "If you can reformulate the drug so it starts working again, it helps the patient and the U.S. patent office will grant an extension."

Nothing Small About Nanotech's Market Potential

Year Market excluding semiconductors and electronics Market including semiconductors and electronics
2007 $83 Billion $135 Billion
2012 $263 Billion $693 Billion
2015 $1.5 Trillion $2.95 Trillion
Source: Cientifica Ltd.
Because of the newness of the technology and the length of the FDA approval process, nanotech-enabled medications and processes are only beginning to arrive on the market. However, that will change soon, and in a big way, says Uldrich: "You're going to hear a lot of exciting and promising developments in nano-engineered pharmaceuticals, but most of these are at least three years away from commercial reality."

Presently, the biggest existing market for nanotech lies in coatings of various kinds, from a window treatment from 3M that reduces UV penetration to a window coating from Nanofilm that ensures clear vision. In heavy industry, coatings range from Nanosteel's hardfacing materials to Kennametal's nano-coated cutting inserts to cut through that coated steel.

Other notable coatings applications include Nanophase's nano-enhanced paint (used in Behr Paints for increased moisture and mildew resistance) and the stain-resistant "nano-whisker" coatings from Nano-Tex (used by Perry Ellis, Brooks Brothers and Eddie Bauer, among others).

These nano-fiber coatings are allowing the resurgence of an industry long thought extinct in the U.S., observes Uldrich. "For years people have been saying that the textile industry in America is dead and that nothing could be done to revitalize it," he says. "Well, along comes nanotech, and now American manufacturers are winning shelf space back." Uldrich notes that billionaire investor Wilbur Ross, who is "definitely not a venture capitalist," has invested heavily in a nanotech-enabled textiles market Ross estimates will grow from an $11 billion market in 2007 to $120 billion by 2012.

Emerging Tech Convergence

For the Ecology Coatings team, a potentially lucrative avenue of research lies in paper coatings of various kinds, from reducing the transmission of moisture through food packaging to developing a coating for thermal imaging paper for a manufacturer of medical labels. And in what might shape up to be a perfect storm of emerging technology, the firm's coatings are under consideration by radio-frequency identification (RFID) tag companies to drive down cost-per-tag price.

"We've met with experts in the electronic interconnect industry, and they've expressed an interest in our coating on a paper substrate as a low-cost alternative for epoxy or polyester substrates for RFID tags," says Krotine.

Taking the NanoPulse

For further reading, check out the "Taking the NanoPulse," Scott Rickert's monthly column on nanotechnology.
Interestingly, in at least one application nanotech might beat RFID at its own game. The security and traceability imperative in pharmaceuticals has led to a push for industrywide RFID tagging of pill bottles. However, a Skokie, Ill.-based company called NanoInk is stepping into the same niche, potentially leapfrogging RFID altogether with a nano-engineered authentication application designed to enable molecular encryption at the individual tablet level.

NanoInk CEO Cedric Loiret-Bernal says that his company's process would allow pharmaceutical and regulatory interests to have full traceability information, as well as expiration date and market data, at any point along the supply chain. So in yet another example of tech convergence, soon nano-encryption could be used to certify the integrity of nano-engineered medications.

Small Green Steps

Nanotechnology also has a growing part to play in another emerging global sector -- "clean tech" processes and products.

In this area, too, researchers are making strides that could have significant implications for global enterprises. For example, earlier this year A123 Systems, a supplier of nano-engineered lithium-ion batteries, signed an agreement with General Motors to supply batteries for GM's hybrid vehicles program. The battery technology being used is based on ultracapacitor research from MIT, and is expected to be tested in GM prototypes (like the Chevy Volt electric car) starting in October.

New advances in catalysts are poised to offer environmental benefits in the petroleum economy, as well as whatever comes next. For example, researchers at Nanostellar are improving the catalytic conversion process for today's diesel engines through the nano-engineering of gold as an oxidation catalyst.

Even oil itself is being transformed. "A number of companies are developing proprietary nanoparticles that can take heavy crude oil -- basically the bottom-of-the-barrel oil -- and refine it into lighter, cleaner-burning crude," says Uldrich. This new process will make for less resource usage in the energy- and chemistry-intensive refining industry, as well as a cleaner end product, he says.

Uldrich is just as bullish on nanotech's potential in alternative energy production like thin-film solar cells, as well as in lithium-ion battery technology improvements and even in fuel cells -- a technology that he says has underdelivered on its promise so far. "New catalysts can improve the electrochemical conversion process in fuel cells, and advances in nanomaterials are making the safe storage of hydrogen a reality."

For their part, the marketing team at Ecology Coatings touts the environmental benefits of its nano-enabled, UV-curable formulations. "Our coatings reduce thermal energy use by as much as 80% and can save manufacturers up to 85% of plant floor space," claims Ramsey.

As nanotechnology moves from being cutting-edge to being a general-purpose technological process, the term itself could ultimately disappear from general use. "After all, nobody buys our products because they're nanotech based," Nanofilm's Rickert says. "They buy them because they do amazing things."