Nanotech Tools

SUMMARY

US market to skyrocket through 2008

The overall market for nanotech tools in the US is projected to expand just under 30 percent per year through 2008 to $900 million, subsequently tripling in size to reach $2.7 billion in 2013. As the focus of the nanotechnology business increasingly shifts away from basic research and toward the development of practical, commercially viable products, the demand for associated tools will be urgent.

Massive upgrade in nanotech tools is expected

Nanotech tools represent a key segment of the emerging nanotechnology business, allowing for the visualization, measurement, manipulation, fabrication, production, simulation and testing of matter in the nanoscale range -- approximately 1- 100 nanometers. Such tools are indispensable to the large-scale commercial realization of nanotechnology materials, devices and other products. Proponents of nanotechnology such as the US governmentfs National

Nanotechnology Initiative are universally calling for a massive upgrade in the quantity and quality of available nanotech tools, and this is expected to generate substantial growth in the market over the next decade and beyond.

Nanoscale visualization tools dominate

As of 2003-2004, about three-quarters of commercial nanotech tools demand was accounted for by basic research applications in public sector, university, research institute and private sector laboratory settings. Visualization tools -- and scanning probe microscopes in particular -- account for the vast majority of existing nanotech tool product sales.

Applications to diversify away from basic research

Over the next several years, it is expected that the market for nanotech tools will become increasingly diverse in terms of both products produced and applications served. Industries and sectors such as electronics -- especially semiconductor fabrication -- and the life sciences -- pharmaceuticals, medical devices, biotechnology, etc. -- appear to hold particularly good prospects over the relatively short term (roughly five to ten years out).

Producers of all sizes competing in formative stage

As would be expected, the nanotech tools industry is in the formative stage, featuring a large number of small, research-oriented start-up type companies, as well as various large corporate entities such as IBM and Hewlett-Packard. There are also a number of mid-sized publicly held concerns that do a fairly sizeable business in the nanotech tools area, including the likes of Veeco Instruments and FEI.

Study coverage

This new Freedonia industry study, Nanotech Tools provides historical US demand data for 2000 and 2003 plus forecasts to 2008, 2013 and 2020 by nanotech tool type (e.g., visualization, measurement/ metrology, fabrication/ production, simulation/ modeling); and by application (e.g., basic research, electronics, biomedical). The study also evaluates market share and profiles industry competitors.

TABLE OF CONTENTS

INTRODUCTION viii

I. EXECUTIVE SUMMARY 1

II. MARKET ENVIRONMENT 4

• General 4
• Economic Environment 5
• Cyclical Trends 6
• Long Term Trends 9
• Nanotechnology Infrastructure 10
• Research & Development Initiatives 10
• Public Sector 11
• Universities & Research Institutes 11
• Private Sector 12
• Industrial Sector Outlook 12
• Electronics Sector Outlook 14
• Electronic Components 16
• Subsystems & Devices 19
• Biomedical Sector Outlook 20
• Pharmaceuticals 21
• Medical Supplies & Devices 22
• Biotechnology 23
• Aerospace/Defense Outlook 24
• Nanotechnology Commercialization Issues 26
• Cost/Pricing Issues 28
• Environmental & Regulatory Issues 30
• Multinational Environment 31
• World Nanotech Tools Market 32
• International Nanotech Tool Programs 34
• Foreign Trade & Multinational Investment 35

III. TECHNOLOGY 36

• General 36
• Basic Concepts 37
• Molecular Chemistry & Quantum Physics 37
• Electronics Technology 39
• Semiconductor Fabrication 40
• Conventional Techniques 41
• Nanolithography & Self Assembly 42
• Nanotechnology Overview 43
• Definitions 44
• Products 44
• Nanomaterials 46
• Nanodevices 47
• Chemicals & Polymers 48
• Nanotech Tool Technologies 49
• Microscopy 49
• Metrology 51
• Fabrication/Production 52
• Simulation/Modeling 52

IV. PRODUCTS 54

• General 54
• Visualization Tools 57
• Scanning Probe Microscopes 59
• Scanning Tunneling Microscopes 60
• Atomic Force Microscopes 61
• Electron Microscopes 62
• Other Visualization Tools 64
• Measurement Tools 65
• Spectroscopic Tools 67
• Probes 69
• Other Measurement Tools 71
• Fabrication/Production Tools 73
• Nanolithographic Tools 76
• Nanomanipulation Tools 78
• Other Fabrication/Production Tools 79
• Simulation/Modeling Tools 80

V. MARKETS 82

• General 82
• Basic Research 85
• Public/Quasi-Public Sector 87
• Private Sector 88
• Electronics Sector 89
• Semiconductors 91
• Other Electronic Products 93
• Biomedical Sector 96
• Pharmaceuticals 98
• Medical Supplies & Devices 100
• Biotechnology Products 102
• Industrial Sector 104
• Aerospace/Defense Sector 106
• Other Markets 108
• Consumer Products 109
• Construction 110
• Motor Vehicles 110
• Energy Generation & Storage 111
• All Other 111

VI. INDUSTRY STRUCTURE 113

• General 113
• Industry Composition & Market Share 114
• Research & Product Development 117
• Manufacturing 119
• Marketing & Distribution 121
• Financial Requirements 123
• Mergers & Acquisitions 126
• Strategic Partnerships 127

Company Profiles 136

• Accelrys Incorporated 139
• Advanced Imaging Incorporated, see Veeco Instruments Incorporated
• Agilent Technologies Incorporated 140
• Arryx Incorporated 142
• Asylum Research 143
• BioForce Nanosciences Incorporated 144
• FEI Company 146
• First Nano Incorporated 149
• Gatan Incorporated, see Roper Industries Incorporated
• General Nanotechnology LLC 150
• Hewlett-Packard Company 151
• Hitachi Limited 153
• Intel Corporation 156
• International Business Machines Corporation 158
• JEOL Limited 161
• JMAR Precision Systems Incorporated 163
• JMAR Technologies Incorporated 164
• Keithley Instruments Incorporated 166
• KLA-Tencor Corporation 168
• Molecular Imaging Corporation 170
• Molecular Imprints Incorporated 171
• Moore Tool Company 173
• MTS Systems Corporation 174
• NanoFeel 176
• Nanogen Incorporated 177
• NanoInk Incorporated 181
• Nanometrics Incorporated 183
• Nanometrix Incorporated 185
• Nanosurf AG 186
• nPoint Incorporated 187
• Pharmacopeia Incorporated, see Accelrys Incorporated
• Quantum Dot Corporation 188
• Quantum Science Research, see Hewlett-Packard Company
• RHK Technology Incorporated 190
• Roper Industries Incorporated 192
• Ultratech Incorporated 194
• Veeco Instruments Incorporated 195
• Zygo Corporation 198
• Zyvex Corporation 200

LIST OF TABLES

SECTION I -- EXECUTIVE SUMMARY

• Summary Table 3

SECTION II -- MARKET ENVIRONMENT

• 1 Macroeconomic Environment 8
• 2 Industrial Sector Indicators 14
• 3 Electronic Product Shipments 16
• 4 Electronic Component Shipments 18
• 5 Electronic Instrument Shipments 20
• 6 Pharmaceutical Shipments 22
• 7 Medical Supply & Device Shipments 23
• 8 Defense Spending Trends 26
• 9 World Nanotech Tools Market 33
• 10 Selected International Nanotech Tool Programs 34

SECTION III -- TECHNOLOGY

• 1 Nanotechnology Market Trends 45

SECTION IV -- PRODUCTS

• 1 Nanotech Tools Demand by Type 56
• 2 Nanotech Visualization Tools Demand 59
• 3 Scanning Probe Microscopes Demand 60
• 4 Nanotech Measurement Tools Demand 66
• 5 Spectroscopic Tools Demand 69
• 6 Probes Demand 70
• 7 Other Measurement Tools Demand 73
• 8 Nanotech Fabrication/Production Tools Demand 75
• 9 Nanolithographic Tools Demand 78
• 10 Nanotech Simulation/Modeling Tools Demand 81

SECTION V -- MARKETS

• 1 Nanotech Tools Market by Application/Sector 84
• 2 Basic Research Nanotech Tools Market 86
• 3 Electronics Sector Nanotech Tools Market 91
• 4 Semiconductor Nanotech Tools Market 93
• 5 Other Electronic Products Nanotech Tools Market 96
• 6 Biomedical Nanotech Tools Market 98
• 7 Pharmaceuticals Nanotech Tools Market 100
• 8 Medical Supplies & Devices Nanotech Tools Market 102
• 9 Biotechnology Nanotech Tools Market 104
• 10 Industrial Nanotech Tools Market 106
• 11 Aerospace/Defense Nanotech Tools Market 108
• 12 Other Nanotech Tools Markets 109

SECTION VI -- INDUSTRY STRUCTURE

• 1 Research & Development Spending Patterns: Selected Nanotech Tool Companies 119
• 2 Capital Spending Patterns: Selected Nanotech Tool Companies 121
• 3 Composite Financial Ratios: Selected Nanotech Tool Companies, 2003 125
• 4 Selected Acquisitions & Divestitures 127
• 5 Selected Strategic Partnerships 129
• 6 Revenue & Profits Data: Selected Nanotech Tool Companies, 2003 137

LIST OF CHARTS

SECTION II -- MARKET ENVIRONMENT

• 1 Nanotech Tools Pricing Patterns 30

SECTION III -- TECHNOLOGY

• 1 US Nanotechnology Market by Major Product Type, 2003 & 2020 46

SECTION IV -- PRODUCTS

• 1 Nanotech Tools Demand by Type, 2003 & 2013 57

SECTION V -- MARKETS

• 1 Nanotech Tools Market by Application/Sector, 2003 & 2013 85

SECTION VI -- INDUSTRY STRUCTURE

• 1 US Nanotech Tools Market Share by Company, 2003 116