A New York Times article claims the corporate Research & Development lab is dead. You know, those places which created the transistor, satellite communications, computer processors, databases...yuppers...all of that is now just a huge waste of time and money.

So, in the Internet era, what is the continuing role and comparative advantage of the corporate R.& D. lab?

Its role will be smaller and its advantage diminished, suggests Michael Schrage, a research fellow at the Center for Digital Business at the Sloan School of Management at M.I.T. The idea-production process, according to Mr. Schrage, will continue to shift away from the centralized model epitomized by large corporate labs, going from “proprietary innovation to populist innovation.”

Much of traditional corporate R.& D. spending, he said, has been subsidized by profits that are increasingly under Internet-era pressures. “The economic case for a lot of in-house R&D no longer makes sense,” Mr. Schrage said.

The best bet for corporate R.& D. labs, he said, is to adopt a “federated” model that leverages all the innovative work by outsiders in universities, start-ups, business partners and government labs. The corporate lab’s role, then, is to be more of a coordinator and integrator of innovation, from both outside and inside the company walls.

Right. That's codespeak for ripping off other people's ideas on the cheap. Anyone want to write major portions of code for $1000 dollars and contribute them to open source? You get the idea. (Also note, there would be no open source if those greedy damn engineers at Bell Labs hadn't slaved for decades developing Unix).

The article quotes grant money figures being awarded via R&D grants, $75,000. That is not even one engineer's salary for one year! So, Hewlett Packard, our most notorious slash and burn outsourcer, is claiming $75,000 in grant money, remember these are the funds for the entire project, not just the salary of one poor graduate student or Post Doc, will fuel the next great wave of innovation.

What a sorry excuse for an article. It's clear corporations are simply not investing in advanced R&D and assuming some Schmuck will do it for next to nothing or for free or the most obvious, where $75,000 dollars is more like $1.5 million in terms of standard of living and costs. (say India or China?)