Newswise — The world's top 100 R&D spenders as a whole increased their R&D spending by a healthy 7.6 percent in 2004, to $254 billion. Looking back over five years of R&D top 100 data from FY 00 to FY 04, we see that the top 100 increased their R&D spending by 21 percent from $210 billion in 2000 to $254 billion in 2004.
While R&D spending has increased rather steadily in the pharmaceutical and biotech sector, the trend has been much more volatile in the technology hardware and equipment sector, which includes computer, semiconductor, and telecommunications equipment firms. Its research funding hit bottom in 2003, then rose 8.1 percent in 2004, to nearly $65 billion. Yet that above-average gain couldn't make up ground lost following the dot-com bust, which is why it is the only major sector to lose ground since 2000, with a 9 percent drop in R&D remarkable for having come at a time of a recovery in sales, which are now back to 2000 levels. The sector, which boasted 11 firms in the top 25 in 2000, had only 6 in 2004. As a result, its share of the top 100 spending fell from 34 percent in 2000 to 25 percent in 2004. Its R&D intensity dropped nearly a whole percentage point from 2000 to 2004.
The composition of the R&D leaders within the technology hardware and equipment sector has changed markedly. The top four spenders in 2000 were all telecommunications firms: Nortel, Lucent, Motorola and Ericsson together accounted for nearly $20 billion. By 2004, they had chopped spending to just $9 billion.
The sector's semiconductor firms, led by Samsung and STMicroelectronics, increased spending. The single exception was Motorola's spin-off Freescale, which reduced spending by about 4 percent. Samsung Electronics went on a spree in 2004, increasing R&D spending by nearly 36 percent, or more than $1 billion, to leap from number 25 to 16 on this year's list. The South Korean company's R&D spending has now topped $4.5 billion, just behind industry leader Intel, at $4.8 billion.
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