Prototype Commercialization: The Economic Ripple Effect

Government prototyping contracts often fuel scientific exploration across fields, leading to the development of prototypes with the potential to revolutionize industries and improve lives.

However, the impact of this investment is only realized when these prototypes transition from the lab to the marketplace. This process, known as commercialization, can create a ripple effect, generating jobs and boosting the innovation ecosystem.

Prototype Commercialization Fuels Job Growth Across Industries

The most immediate benefit of prototype commercialization is the creation of new jobs. When a government prototype is adopted by a private company or spun out into a new venture, it starts a chain reaction of employment opportunities:

Manufacturing: Scaling up a prototype for commercial production requires skilled labor in manufacturing, assembly, quality control, and logistics.

Sales and Marketing: Introducing a new product to the market creates the need for teams dedicated to sales, marketing, advertising, and customer support.

Research and Development: Continued innovation and product improvement require ongoing investment in R&D, leading to the hiring of scientists, engineers, and technicians.

Support Services: The growth of a successful commercialized product also fuels demand for supporting industries such as legal services, finance, supply chain management, and IT support.

One example of this is the development of modern weather forecasting technologies. Early weather satellites and atmospheric modeling techniques were largely products of government investment.

The transition of these prototypes into commercial applications created jobs in satellite manufacturing, software development, and private weather service providers. Furthermore, the availability of accurate weather information supports jobs in weather-sensitive industries like agriculture, highlighting the broad economic impact.

Government-Funded Prototypes Accelerate Technological Breakthroughs

Beyond direct job creation, government prototype commercialization acts as a catalyst for the broader innovation ecosystem:

Knowledge Spillover: Commercialization facilitates the transfer of knowledge and technologies from government labs and universities to the private sector. This “spillover” effect allows businesses to leverage publicly funded research, accelerating their own innovation efforts.

Attracting Venture Capital: Successful prototype commercialization demonstrates the viability and market potential of new technologies, attracting private investment and venture capital. This influx of funding further fuels innovation and growth.

Entrepreneurship: The opportunity to commercialize prototypes can inspire entrepreneurs to launch new businesses, bringing novel products and services to the market. These startups can become engines of job creation and further innovation.

Driving Competition and Efficiency: The introduction of new, commercially viable technologies spurred by government research can disrupt existing markets, forcing competitors to innovate and improve efficiency. This ultimately benefits consumers through better products and lower prices.

Inspiring Future Research: The success stories of commercialized government prototypes can inspire future generations of scientists and engineers, encouraging them to pursue careers in research and development. It also justifies continued government investment in basic and applied research.

It’s important to note the role the U.S. Department of Defense (DoD) plays in this process. Mandated by 15 U.S.C. § 3710, the DoD actively transfers its funded inventions to the private sector to fuel economic growth and national competitiveness.

The DoD’s Technology Transfer (T2) program, particularly its T2-Transition Pathway, is vital for this. This pathway serves as a link between DoD labs and the U.S. Warfighter, enabling the conversion of innovations into procurable military products by engaging innovative companies, many of whom are new to defense contracting, expanding the industrial base. T2 offers a cost-effective route for delivering new technology to the Warfighter, as industry shoulders most product development costs, proving more economical than traditional defense contracting.

One tech transfer success story is Naval Surface Warfare Center (NSWC) Crane partnered with Draper Laboratory through a Cooperative Research and Development Agreement (CRADA) to enhance microelectronics packaging for anti-tampering. This collaboration allowed for the secure exchange of classified information and iterative feedback from NSWC Crane, guiding Draper in improving their 3-D technology to meet military requirements. The resulting technology, developed without direct government funding, is now being implemented across multiple defense agencies to safeguard critical systems.

Government Prototypes That Transformed Technology and the Economy

Here are examples of government prototypes that were commercialized, leading to job creation and innovation:

The Internet (ARPANET): The Advanced Research Projects Agency Network (ARPANET) was the first wide-area packet-switched network with distributed control and one of the first computer networks to implement the TCP/IP protocol suite.

It was funded by the U.S. Department of Defense’s Advanced Research Projects Agency (DARPA) starting in 1969. ARPANET was essentially a prototype to explore the feasibility of robust computer networking for the military.

While not “commercialized” in the traditional sense of a single product, the underlying technologies and concepts developed through ARPANET were foundational to the creation of the modern Internet that we all know.

The Internet’s emergence fueled the creation of countless industries and job roles and revolutionized communication and access to information on a global scale. It fostered innovation across almost every sector.

Global Positioning System (GPS): GPS was initially developed as a military navigation system by the U.S. Department of Defense, with the first satellite launched in 1978 called the Navstar Global Positioning System. It was designed to provide precise location and time information to military users worldwide.

In the 1980s and 1990s, the U.S. government gradually made GPS accessible for civilian use, leading to widespread commercialization. The commercialization of GPS spurred job growth in numerous sectors, with companies producing handheld GPS units, car navigation systems, and GPS-enabled wearables.

It has significantly improved convenience across various industries.

Micro-Cathode Arc Thruster (µCAT) for Satellites: Dr. Michael Keidar and his team at George Washington University developed the µCAT, a compact and efficient plasma thruster that uses metal propellant to generate thrust. Initial research was funded through government grants.

The capabilities of the µCAT led to its commercialization through licensing to private companies. The µCAT technology addresses a need for efficient and precise propulsion for small satellites (CubeSats, NanoSats). These small satellites are used for imaging, communication, scientific research, and more. The µCAT enables better on-orbit maneuvering, extending the lifespan and capabilities of these satellites.

NSTXL Is Shaping the Future of Tech Innovation

Organizations like NSTXL are streamlining the process of bringing cutting-edge technologies from concept to reality and thus bringing them to the commercial space through the utilization of OTAs.

SpEC is bridging the gap between military and commercial space sectors, facilitating rapid prototyping and technology development, exemplified by L3Harris’s, Millennium Space Systems’ and Raytheon Intelligence and Space’s work on the Missile Track Custody program. This program will create jobs in research, engineering, manufacturing, integration, program management, and potentially commercial spin-offs.

The dual-use nature of the above technologies ensures that these innovations, developed for defense applications, can find commercial applications, creating new industries and opportunities across other sectors.

Building Tomorrow Through Smart Tech Investment

Government-funded research represents a national investment in knowledge and discovery. By facilitating the commercialization of promising prototypes, governments can unlock a powerful engine for job creation and innovation.

The ripple effect extends far beyond the initial research investment, promising to secure a brighter future driven by technological advancement.

About NSTXL

NSTXL is focused on building a network of innovators and creators across the most sought-after emerging technology fields. As an open-source platform, our approach was designed to encourage network growth and collaboration without stifling change. We support our network by providing commercial-term contracting, open-source technology discovery, modern-day marketing outreach, a strongly interconnected network for easy teaming and cybersecurity compliance support.