The Decision: In the midst of the tech crash, Corning put big money into the development of a sleepy technology: pollution filtration for diesel engines.

Corning has pioneered some of the sexiest technology of the past 100 years. The incandescent light bulb. The picture tube for color TVs. Windows for every NASA spacecraft. The glass screens for laptop computers and flat-panel TVs. And, yes, optical fiber. They invented it.

Then there's the tailpipe business. In the world of glamorous technology, it never hurts to have a dependable trade in something like cleaning up the exhaust of cars, trucks, and buses. More than 30 years ago, Corning developed the honeycombed materials that have become the guts of catalytic converters, dramatically reducing pollution. "Environmental technology," as Corning calls it, has been a steady business for the company ever since.

Then, four years ago, even as Corning's fiber-optics business was unraveling, the company's leadership decided to place a daring bet on cleaning up diesel exhaust. That bet--which is just now beginning to play out--commits Corning to spending upward of a half-billion dollars and harnessing the talent of hundreds of researchers to develop, manufacture, and sell a line of devices to dramatically reduce pollution from diesel-powered vehicles. Diesel engines produce slightly different pollutants--including soot--than gas-powered engines, and typical car technology is ineffective against them.

"This is not a wild leap off a cliff," says Joe Miller, Corning's chief technology officer. At the same time, Miller says, it was "a very, very gutsy decision." The collapse of the tech bubble was as vivid, and as traumatic, at Corning as anywhere. Indeed, it must have appeared to blow a hole in Corning's financial performance. The company's total quarterly revenue peaked in the fourth quarter of 2000, at $2.1 billion. Just eight quarters later, in the fourth quarter of 2002, Corning's quarterly revenue was down to $736 million.

In the midst of layoffs and factory closings--only one of the five fiber-optics factories that Corning operated in 2000 remains open--the company shut down research labs in New Jersey, England, Japan, and Russia. R&D spending was cut by $5 million per week--nearly 50 percent from 2001 to 2003--affecting even Corning's storied Sullivan Park research complex. Meanwhile, diesel technology's share of the budget grew "fourfold," says Miller.