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The 2005 edition of the TR R&D Scorecard ( pdf ) shows that worldwide corporate spending is picking up ( Big Spenders ), but that the gains are unevenly distributed ( Where the Growth Is ). The biggest advances are in the life sciences, which also happen to be among the most research-intensive industries ( Innovation Sectors ): 2004 R&D spending among the biotech companies on the list shot up by an average of 69 percent over the previous year.

The gain at pharmaceutical companies was less spectacular but still a strong 22 percent. IT companies, on the other hand, have as a group barely increased their R&D outlays; telecommunications and computer hardware companies, on average, spent less than in 2003. Spending in telecom remains particularly troubled, with several leading companies, including Motorola, Ericsson, and NTT, reporting double-digit decreases. In IT, however, software remains an exception; Microsoft paced the sector to a 20 percent increase in research spending in 2004.

The scorecard ranks companies by the Technology Review Innovation Index ( TR Innovation Index - Top 15 ), which takes into account R&D spending levels, spending increases, and R&D as a proportion of sales; five of the top 10 companies according to this metric are in life sciences.

But numbers alone don’t tell the corporate research story. Another indicator of vibrant R&D is willingness to invest in visionary projects that may not pay off for many years–if ever. In this spirit, we spotlight three “blue sky” research efforts.

Intel’s use of lasers to detect biological molecules with exquisite sensitivity could help researchers understand the causes of cancer and other diseases. Lucent Technologies’ Bell Labs–which has in the past decade severely curtailed the basic research that once made it such a jewel–is making progress toward the radical concept of quantum computing. And IBM has launched an effort to use supercomputers to model the human brain. These projects provide a heartening counterweight to the common charge that industry is overly fixated on next quarter’s results. – Edited by Herb Brody

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