Copyright: 1996 - 2024
BSEE - KB3UON
RF Cafe began life in 1996 as "RF Tools" in an AOL screen name web space totaling
2 MB. Its primary purpose was to provide me with ready access to commonly needed
formulas and reference material while performing my work as an RF system and circuit
design engineer. The World Wide Web (Internet) was largely an unknown entity at
the time and bandwidth was a scarce commodity. Dial-up modems blazed along at 14.4 kbps
while typing up your telephone line, and a nice lady's voice announced "You've Got
Mail" when a new message arrived...
All trademarks, copyrights, patents, and other rights of ownership to images
and text used on the RF Cafe website are hereby acknowledged.
My Hobby Website:
the State of R&D
According to recent published reports,
overall research and development spending in the U.S. and around the world by private
businesses has been declining. At least in the U.S., determining exactly how much
of a publicly traded company's reported R&D funds actually is applied toward
real research is getting harder because of a practice being used by companies like
Microsoft whereby stock options and issuances are thrown into the R&D expense
column in the financial ledger. There is a chance that the Securities and Exchange
Commission (SEC) will begin requiring all companies to abide by the process. Only
an act of Congress will prevent it from becoming law.
A common lament from
both academic and corporate researchers is the trend away from basic research and
toward specific, "applied R&D," which is product-oriented research. As competition
gets tougher, companies feel they cannot afford to spend money on anything other
than projects that have some probability of improving the bottom line. Stockholders
have influenced the decision by criticizing and even threatening companies with
class action lawsuits for nonperformance when spending what is deemed too much on
As with fundamental product design and manufacturing,
R&D is experiencing the globalization thing. Many companies are relocating or
building new research laboratories offshore in order to exploit cheaper labor and
lower overall costs of doing business. A lot of the R&D dollars are being diverted
from U.S. and European universities and provided to schools in India, Taiwan, China,
and other such familiar countries. Massive amounts of technology is being transferred
by U.S. and European countries in this manner. Test and processing equipment, software,
and materials accompanies the research dollars.
With all that in mind, here
is an excerpt from the IEEE Spectrum's 2004 survey of the world's top R&D spenders
(actually for FY2003). Topping the list this year is, Microsoft. Bill's accountants
reported $7.8B in R&D spending; however, $1.3B was paid out as shares to its
research employees. If not for the stock payout, MS would have been in 4th place,
assuming the three companies ahead of it did not report stock issuances. The previous
year, Microsoft was only in 10th place, so creative accounting can really benefit
a company's image.
Ford Motors Co. came in in second place with $7.5B in
R&D. The Pfizer drug company made 3rd, and DaimlerChrysler placed 4th. Coming
in 5th with $6.2B is Toyota. General Motors, whose stock borders on junk status
these days, made 7th place (down from 4th the previous year) at $5.7B. Sony comes
in 12th at $4.9B and mobile phone giant Nokia spent $4.5B to hit 13th place, and
Intel followed closely in 14th. Motorola (not including its Freescale spin-off),
finished at 17th place; Freescale finished in 77th. Together, they would qualify
for 11th place. Hewlett Packard, out of which came Agilent Technologies, hit 20th
place with $3.7B in R&D outlays. Agilent placed 75th with $1.1B, so together
they would also have qualified for 11th place.
The U.K.'s BAE (British Aerospace),
with a very strong physical presence in the U.S., spent $3.0B for a 3first ranking
spot. Japan's Fujitsu is in 40th place with $2.3B. General Electric dropped a little
to 42nd place. Texas Instruments placed 50th with $1.7B in R&D. NTT DoCoMo,
the Japanese 3G phone service company, rated 70th place with $1.1B. EMC Corporation
made a precipitous drop from 84th place to 100th place, with a "mere" $718M in R&D.
See the November 2004 edition of Spectrum for more company rankings, or send me
an e-mail with the company in which you are interested.