A dramatic, industrial revolution is taking place in California, driven by nanotechnology. In January 2004, CCST provided a briefing to help state policy-makers understand the changes underway and plan for the future. Nanoscience and Nanotechnology: Opportunities and Challenges in California, was presented to the Senate-Assembly Joint Committee on Preparing California for the 21st Century co-chaired by Sen. John Vasconcellos (D-Santa Clara) and Assm. Sarah Reyes (D-Fresno) on January 20.

"If managed smartly, nanotechnology has the potential to bring jobs and wealth to California. It is the next wave of technology. It's our decision to ride it and make the most of it - or be overwhelmed by it." -John Vasconcellos California State Senator 21st Century Committee Co-chair

Nanotechnology is concerned with materials and systems at the nanoscale, one-billionth of a meter, whose structures and components exhibit different physical, chemical, and biological processes due to their size. Many disciplines converge in nanoscale research, which has significant implications for materials manufacturing, energy, biotechnology, medical instruments, and computers. Economists predict a trillion-dollar multi-industry market for nanoproducts over the next 10 to 15 years. The federal government is investing substantially in nanotechnology R&D, allocating $847 million for this year's National Nanotechnology Initiative (NNI) and $3.68 billion over four years via the Boehlert-Honda 21st Century Nanotechnology Research and Development Act of 2003. In addition, venture capitalists invested an estimated $1.2 billion in nanotechnology in 2003, and are poised to spend more this year.

"It's very important for us to create a framework for the Legislature to deal with the legal, social, and ethical implications of emerging technologies such as nanotechnology." -Debra Bowen California State Senator 21st Century Committee Member

The Committee asked CCST to prepare this briefing as part of its two-year investigation of technology issues facing the state. At issue is the opportunity for California's research institutions and industries to be leaders in research and development of this field in the face of stiff worldwide competition while considering the social, ethical and legal implications of a radically new technology.

The CCST briefing document notes that despite California's high-tech advantages, it has serious challenges to overcome if it is to maintain its technological, economic and social leadership in nanotechnology. Organizations such as the Semiconductor Industry Association have stated that current technologies are quickly reaching their physical limits, and that nanotechnology research is needed to extend the limits of current processes through the introduction of new materials, and to eventually supersede current processes with completely new design structures.

In addition to these changes, potential challenges to the healthy development of California's nanotechnology industries include the following:

• Loss of Existing Assets - the loss or degradation of any of California's existing high-tech assets - such as our skilled workforce, concentration of venture capital, strong research institutions - would be extremely problematic.
• Scope - though we often think of nanotechnology as a singular field, it actually represents a collective advance across several disciplines. Development will certainly not be uniform, and there is the potential that public concern about implausible applications may halt research across the board.
• Transition - existing industries will have to undergo radical transformation to survive such changes as the shift from silicon-based computer chips to carbon nanotube-based chips.
• Intellectual Property (IP) - nanotechnology will lead us to uncharted legal territory (can you patent an atom?) and inefficiencies in the transfer of IP between universities, government and industry could dampen business activity.

The document consists of sections designed to focus on key areas relevant to California and assist the Committee in understanding the issues, including a definition of nanoscience and nanotechnology; how California is positioned to take advantage of the changes nanotechnology is bringing; how nanotechnology industries are forming and transforming; workforce issues; best practices in nanotechnology commercialization; and social and ethical issues.

On May 20, 2004, Senator Vasconcellos issued a Senate Resolution stating that CCST's report was an "instrumental force towards establishing, framing, and initiating a well-informed dialogue with massive and complex... ramifications for California's economy, society, and environment."