Creating and Executing a Technology
Strategy for a Global Industry
Hal Stillman
Director of Technology
International Copper Association, Ltd.
20 October 2006
hstillman@copper.org
Slide 1
ICA TECHNOLOGY
Research, develop, and commercialize new
and improved product and process
technologies, and create new uses for copper
Very complex situation
How to start
How to achieve success
Slide 2
COPPER PROPERTIES
Electron structure is origin of many
valuable properties
Single electron at fourth energy level
is highly mobile; fills only 1 of 32
available positions
Electron has gas-like behavior; moves
to transfer charge, collides to transfer
vibration (heat)
Easy to create copper ion: copper ions
readily penetrate microbes when
mobilized in adsorbed water
Other properties arise from cubic
crystalline structure: malleability,
color, alloying
Slide 3
COPPER/ALLOY ADVANTAGES
High electrical
conductivity
High thermal
conductivity
Range of valuable
mechanical properties
Corrosion resistance
Aesthetic qualities
Slide 4
Antimicrobial surface
Essential for life
100% recyclable
Integral to energy efficient
design
Integral to technological
development
INDUSTRY VALUE CHAIN
Producers
Slide 5
Fabricators
END MARKET APPLICATIONS
Fabricators
Product
Power cable
Building wire
Equipment wire
Automotive Wire
Telecomm cable
Winding wire
Copper RBS
Copper PSS
Copper Tube
Alloy RBS
Alloy PSS
Other
TOTAL
Slide 6
Annual
Use (mt)
2.95
1.40
1.25
0.70
1.60
2.10
0.40
1.40
2.05
1.80
1.20
2.30
End Users
%
Total
15.4%
7.3%
6.5%
3.7%
8.4%
11.0%
2.1%
7.3%
10.7%
9.4%
6.3%
12.0%
19.15 100.0%
60% of copper use is
electrical applications
Main applications and notes
Utility and industrial
Fixed installation in buildings
Energy transmission in equipment
Primarily wiring harness
Utility (50%), Data/voice in buildings (50%)
Motors, transformers
Busbar, power generation/transmission equipment
Electronics (50%), HEX (15%), Architecture (20%), General market
Plumbing (50%) and commercial tube (50%)
Machined brass rod for valves, fasteners, screws, fittings (incl plumbing)
Electrical, electronic, coinage, munitions, builders hardware
Forgings (35%), Alloy wire (15%) for zips, fasteners, electronic pins,
Alloy tube (10%) for condensers, Non cable wire rod (35%) for
grounding/lightning protection, trolley wire and Al alloys, Powders,
Chemicals
ABOUT ICA
A not-for-profit industry trade association*
39 member companies represent >85% of
world copper production
Focus is promoting and developing copper use
Headquarters in New York
27 offices globally with ~200 technical
marketing staff
2006 budget $45 million plus $20 million cofunding
Slide 7
ICA MISSION
Advance copper as the material of choice
for current markets and new applications
given its superior attributes in terms of
technical performance, sustainability,
essentiality for life, and its contributions
to a higher standard of living.
Slide 8
THE UNSTATED MISSION
Do what you can within anti-trust guidelines
to assure that there is demand for just a little
more copper than the industry can produce
Slide 9
SITUATION IN 2002
Very little innovation in the industry
• Copper industry ceding markets to alternative materials
• Little effort to create new applications
Price at bottom of cycle
• Rapidly developing economies expected to raise demand
• Concern about price volatility
Industry highly fragmented
• Strong competition in each stage of value chain
• Producers, fabricators and end-users are not collaborating
to provide superior products for consumers
Slide 10
SITUATION IN 2002
15 million tonnes from mine production
5 million tonnes recycled
Total value in 2002:
• 20 million x $2000 = $40 billion of commodity material
• Low industry profitability
Opportunity for technology development recognized
Avoid repeating experience of automotive radiator
market
Slide 11
AUTOMOTIVE RADIATORS
In 1975 copper had 100% of the market and did not
believe that situation could be changed
By 2002 market share was less than 10% with loss of
>100,000 tonnes
Real reasons for the success of aluminum automotive
radiator is not weight but:
• 25-year development effort of the aluminum industry
• Total neglect in that same period on the part of the copper
industry
Slide 12
AIRCON HEAT EXCHANGERS
Heat transfer enhancement factor
A similar story about to happen…
4
4
Flat tube
Louver fin with flat tube
3
Wavy fin
2
6 mm
7 mm
LG
Toyo 5 mm
6 mm
Matsushita
3
5 mm
Hitachi
2
8, 9.52 mm
Aluminum
7 mm
Small diameter
with groove
9.52 mm
Copper
Groove tube
Louver fin with round tube
1
1
Plain fin
1970 75
80
85
90
95
trapezodial
Smooth tube
triangle
00
(a) Heat transfer enhancement by
high performance fin shape
05
1970
75
80
85
90
95
(b) Tube side heat transfer
enhancement
Same performance at half the size
Slide 13
00
05
ICA TECHNOLOGY INITIATIVE
With the support of ICA’s Technology Steering
Committee, the Director of Technology will:
• Create and execute a plan for the development of an
infrastructure for research work and the search for
promising technologies or products that would benefit
from/or be developed with ICA funded research
• Develop a concept for an external venture capital company
to further development and commercialization of
promising new products and technologies*
Slide 14
SOME CONSTRAINTS
Can not engage in “ordinary business”
Retain not-for-profit status
Anti-trust concern prohibits price discussion
Members are competitors (in many ways)
Slow decision-making
Vocal member opposition to diverting funds to R&D
Wary insider opposition to outsider leading
organization in new direction
Must achieve tonnage impact
Slide 15
BEFORE ICA: INCRA
International Copper Research Association
• Previous industry research organization
• Operated from 1958 - 1990
459 projects in 32 years spending $90 million
Outstanding technical managers
Bookshelf of detailed project reports
• Excellent research quality
No lasting commercial successes
In 1990, industry shut down activity and focused
solely on promotion
Slide 16
THE BOOKSHELF
Slide 17
THE CHALLENGE
Re-start some type of technology activity but do a
better job than INCRA
What would you do?
Slide 18
LEARNING FROM INCRA FAILURE
Surprise: many of the same ideas thought to hold
promise in 1960 still held promise in 2002
• Great job of spotting opportunities, but spread R&D
effort too thinly
• Prematurely stopped work on problems that were worth
solving
• Technical breakthroughs needed to achieve market
success had not been made
Puzzling: once-a-decade review of new
opportunities and commercialization possibilities
• What were they thinking?
Slide 19
LEARNING FROM INCRA FAILURE
Governance barrier to getting directly involved in
commercialization
• Don’t compete with members
• Put R&D results into the public domain and hope for
the best
• Belief that a great research result is sufficient to spark
commercialization
• Single product “Product Engineer” insufficient to drive
commercialization
Slide 20
CONCLUSION #1
Research should hold a persistent focus on real
opportunities despite short-term technical setbacks
• Multiple attempts should be made to find a solution path
to a promising market opportunity
• Focused efforts should not be constantly diverted by the
search for new opportunities
Slide 21
CONCLUSION #2
Find a way to connect technology to the market
through entrepreneurial business development
• An entrepreneur will persist in trying to find a technical
solution to a market opportunity
• Protect intellectual property to capture potential value
• Persistent effort will be needed to find a workable
approach for ICA
• Attract potential commercialization partners and
supporters
But…organization really not ready to embrace
venture capital-like approach to commercialization*
Slide 22
EXECUTION PATH
Articulate desired state
When business and technical people think about
innovation…copper comes to mind
Slide 23
EXECUTION PATH
Form a Steering Committee that helps prioritize
activities and provides political guidance*
Quarterly meetings with briefing book in advance
• Dialogue begins where briefing books ends
• Achieve consensus on major processes and concepts
• Take significant directional decisions
Do R&D, but talk about commercialization
Multi-lingual, multi-cultural, multi-level, multicompany team
• Tell your story in pictures
Slide 24
ICA NETWORK CONCEPT
Connect to a number of networks within key domains and stimulate thinking about copper-related technology
Materials science,
metallurgy and
materials processing
networks
• R&D and academic organizations with a
potential contribution to copper
technologies
• Understand past/current projects and their
relevance to copper
• Leverage ICA funds through their
sources of funding
• Expand on current ICA contact base
Application and
design engineering
networks relevant to
copper
• Academic, industrial and development
organizations that apply copper in
commercial applications
• Identify possible programs relevant to
copper; remove technology roadblocks
• Leverage ICA funding
Government funding
initiatives and
networks associated
with copper
• Understand linkage between copper and
government funding priorities
• Profile types of projects being funded
• Create new funding initiatives that involve
copper
• Connect individuals in other domains to
appropriate funding sources
ICA R&D
Stimulus
Motivation
ICA R&D
funding
Challenge
Management
Interconnection
of R&D domains
H. Stillman
November 2002
Slide 25
ICA Technology
Priorities
PROJECT APPROVAL PROCESS
3
7
Technology Committee
Non-secret, small, simple project
may gain rapid approval
6
9
ICA President
Technology Director
2
4
X
8…
Project Management Team
Project Manager
X
Legal Counsel
X
Periodic review of project by Project
Management Team with decisions to
continue, change or terminate
activities. At least one member is on
Team.
5
Due diligence process for commercial, legal and
technical review; applies to all projects but with
special emphasis on projects undertaken in
collaboration with external firms or organizations
in which disclosure of project information to
members is limited to protect secrecy and
intellectual property rights
X
Subject Matter Experts
(can include members)
Project Proposer
Decisions
Slide 26
1.
2.
3.
4.
1
Submit R&D proposal/concept
Proposal passes screening
Conditional approval
Investigate and resolve conditions
5.
6.
7.
8.
9.
Legal agreements for R&D
Proposal passes due diligence
Funding authorization
Reviews by Steering Committee
Proceed with commercialization
If proposal exceeds approved
technology budget, Advisory
Committee approval is required
1983 Study for INCRA by the Technology Assessment Group
PROBABILITY / IMPACT MATRIX
OF NEW OR EVOLVING TECHNOLOGIES ON COPPER USAGE
Positive
HIGH
Negative
MEDIUM
LOW
NONE
100

HEAT PUMPS
 COMPUTERS
 SEMICONDUCTORS

FISSION
80

SOLAR POWER



BATTERIES


POWER
ELECTRONICS
TRANSMISSION
CABLE
OCEAN
TECHNOLOGY




COMBUSTION
SYSTEMS
MEDICAL
ELECTRONICS
ROBOTICS
SUPERCONDUCTIVITY
HOME & OFFICE
NETWORKS
60

DESALINATION
 TELECOM




ENERGY MANAGEMENT
CATV
CATALYSIS
BIOTECHNOLOGY
40

ELECTRIC
VEHICLES
 LASERS

ELECTROMAGNETIC
PROPULSION
20
0
 FUEL CELLS
 FUSION
LOW
MEDIUM

PRINTED CIRCUIT
BOARDS
HIGH

FIBER OPTICS

AUTOMOTIVE
IMPACT MATRIX
2007-2011
+
100
Probability (%)
80
60
40
20
Impact of emerging/evolving technologies on copper usage
HIGH
MEDIUM
- Antimicrobial
surfaces
- Aquaculture cages
LOW
NONE
- Wind power
- Power doors
- Wireless LANs
- Fission power
- Biotechnology
- Cu nanomaterials
LOW
- High efficiency
stators
- High bandwidth
communications
over copper
- SSM
- Server cooling
- Cu/CNT thermal
conductors
- Al solar thermal
- Rare earth
permanent magnet
motors
- Flat tube HX
- Cu-plate HX
- DGWH
- Vehicle batteries?
- Desalination?
- Dist. energy sys.
- Power quality
- Electric ships
- RFID tags
- Superconductive
cables
- Electroactive
polymer actuators
- Fuel cells (Cucatalyst and
desulphurization)
- Power electronics
- Cu-bulk metallic
glasses
- Nuclear waste
storage
- Cu/CNT electrical
conductors
- Polymer
conductors?
- Polymer HX
- Fusion reactor
systems
- Electromagnetic
rail propulsion?
- Copper-tube
corrosion
solutions
- CO2 heat pumps
MEDIUM
- Wireless telecom
- Fiberoptic LANs
- VOIP
- CMR
- Deep sea cables
- Hybrid automotive
0
HIGH
- PEx plumbing
systems
- Flat panel displays
- Al micro-channel
HX
- Al magnet wire
- Automotive wiring
alternatives
Aug 2006
*: ICA projects shown in red
Slide 28
_
PORTFOLIO ASSESSMENT
CuproBraze
Aquaculture
Cages
Medium
(<50000 tons)
ISG
Deep sea
cables
SuperC
Server
cooling
GeoSolar
CAT 6 CAT 7
GeoSol
PoE
PHE
RTPF
HX
MEGA
Heat exchange systems
Kompact
Internal
HX
High
(> 50000 tons)
Conform
EB
Flat
tube
VAE
Tube
corrosion
Sooner
Slide 29
Low
(<10000 tons)
AntiM
CMR
DGWH
Lower
Probability of technical success
Higher
2007-2011 Impact
Fuel/
Natural
gas-S
FC
catalyst
Tarnish
resistance
Timing
Mech.
alloy
Electrical energy
Antimicrobial
SSM
Cu
BMG
UltraC
Cu2S PV
Nanocoat
Later
PROJECT SELECTION PROCESS
January 200Y
Portfolio planning and
priority setting
April 200Y
June 200Y
Background research
and strategy discussions
Budget allocation and
project recommendations
TSC meetings
200X R&D portfolio
Oct/Nov
10 year impact matrix of
new/evolving technology
Proposed 200Y
Technology budget
200X PRC meeting
0
200Y R&D priorities
1.___________
px
hy

$
200Y
Technology
Plan
st
—
 probability
$/tonne impact
project
$
Project proposals
tonnes
Approved 200Y
Technology budget
Member poll and 200Z
R&D priorities
1.___________
 strategic overview
2.___________
 budget/timing
3.___________
 impact
3.___________
4.___________
 risks
4.___________
Discuss Technology
Roadmap elements
Discussions with R&D
organizations and ICA
Network members
Private conversations
with fabricator members
to manage potential
conflicts of interest
2.___________
$
Project proposals from
R&D Network
. . . Continuous posting of updated planning documents, project reports and proposals on the ICA intranet
Slide 30
Due diligence and
approval processes
less
copper
—
risk
Project contracting
and initiation
…XX Jan 0X
June/Sept
more
copper
 impact
Budget approval and
project proposal
assessment
April
100
January 200Z
Discussion
across ICA
Network
On-going
updates
Dec/Jan
October 200Y


Formal Technology
Roadmap document

ICA TECHNOLOGY PIPELINE
Seek non-automotive market
opportunities; license to
product companies; apply new
Cu technology developments
Engage fabricators and industry
to produce prototypes; aim for
widespread application
Coating production source
available; coating formulation
will be available to members;
members involved in project
Fund start-up to demonstrate
system; engage industry from
the start; possible ownership
position through R&D funding
Support with ICA market
promotion; push market
development in touch
surfaces and aircon
Engage tubing companies
in development project;
quick commercialization if
economically viable
Provide breakthrough to
interested companies to
stimulate market development
Form company to focus solely
on Cu alloy SSM; support with
market promotion; leverage
with government funds
Continue development to
make process more
competitive: wider
tolerances, more efficient
braze coating
Assist foundries and
manufacturers; charge
access fee; leverage with
government funds
*
New projects
starting 2006
MEGA
Electronics
cooling bus
Chemically
grafted
coatings
Flat copper
HX conduits
Antimicrobial
copper/alloy
surfaces
ICA pre-competitive R&D funds move
technologies towards commercialization
New project sources:
 R&D network
 ICA network
 Market intelligence
 Venture capital network
New projects not shown:
 Round tube/plate fin all copper aircon HX
 Plate heat exchangers
 Lower cost solar thermal systems
 Thin section extrusion
 Subsea cables
 Plumbing tube coating
 Water heating heat pump
*
Semi-solid
metal
forming
10
Gbit/sec
Copper
motor rotor
Cuprobraze
Commercialization
Rationale for ICA role to accelerate commercialization
 $2 – 10 million need for technology and market
development
 Market development best pursued by motivated
entrepreneurial company
 Likely to attract external capital to grow a company
 Success would create substantial new copper use
EXECUTION PATH
Set down principles and socialize them
• Buy-in from 15 companies with inconsistent outlooks
• Initiate member-to-member interactions
• Push the group just beyond lowest common
denominator of acceptance
• Assure appropriate level of discomfort
• Give members time for stress relaxation*
Expose to comparable organizations with similar
issues
• Visit Gas Technology Institute
• Soybean Board
Slide 32
ICA’s R&D PRINCIPLES
Focus on creating new, high tonnage, global
applications
Support pre-competitive R&D where ICA funding
can make a difference
No internal resources; global R&D network
Involve members and customers in projects
Take active role in technology commercialization
Leverage with external funding
Each is a difficult sell*
Slide 33
EXECUTION PATH
Build personal relationships with member firms, endusers organizations and R&D organizations
• Visit all ICA members – discuss market dynamics and
technology
• Visit key copper users – understand attitude towards
copper use
• Visit universities, research institutes, corporate labs – find
the leading edge of research
• Stimulate open debate of relevant issues in Technology
Steering Committee
Demonstrate competence and discretion to gain
credibility
Slide 34
EXECUTION PATH
Establish initial pre-competitive projects
• Mix of new applications and unaddressed needs
• Mine the bookshelf; identify new challenges
• Select high risk, learn-as-you-go projects
• Overcome basic obstacles
• Engage full supply chain
• ICA members have first access to developments*
Deal with major exception: secret project with global
automotive OEM
Initiate activities to gain co-funding
Slide 35
COMMMERCIALIZATION CONCEPTS
Focus and sustain effort to achieve tonnage impact
Understand potential market impact and possible
commercialization route from the start
Build credibility through co-funding
Connect technology with entrepreneurial effort
Prefer technology transfer, licensing or royalty over
equity ownership
Equity ownership in business in exceptional cases
Exit ownership position when strategic benefit
achieved
Slide 36
TECHNOLOGY DEVELOPMENT PROCESS
Merge market and
technology insights
Technical capabilities
• Properties
• Processes
Pre-competitive
research/development
Technology feasibility
demonstration
Commercialization
Member/supply chain
participation
New copper
application
Application knowledge
• Industry pain points
• Market dynamics
Slide 37
Market/business
innovation
Venture creation /
entrepreneurial effort
ICA’s R&D FOCUS
Create and commercialize application-directed
technology breakthroughs in a few high potential
technology domains
• Heat exchange systems
• Automotive
• Antimicrobial surfaces
• Renewable energy
• Electrical energy
• Data communications
Slide 38
HEAT EXCHANGE SYSTEMS
Plate heat exchanger
Condensing demand gas water heater
CO2 heat pump
Slide 39
Flat multichannel tube
Small diameter aircon tubes
AUTOMOTIVE HYBRIDS
Integrated starter generator
Slide 40
Electromagnetic transmission
ANTIMICROBIAL
Antimicrobial surfaces
Slide 41
Antimicrobial aircon heat exchangers
RENEWABLE ENERGY
Emergence BioEnergy
Slide 42
GeoSolar system
ELECTRICAL ENERGY
Deep sea electrical cable sheathing
Slide 43
Copper motor rotor (industrial,
appliance and automotive
applications)
DATA COMMUNICATIONS
Data communications beyond 10 Gbps
Slide 44
Power over Ethernet
UNIVERSITY RESEARCH
• Wear-resistant mechanically
alloyed alumina/copper
dispersion
• Silicon carbide reinforced copper
for high temperature heattransfer applications
• Copper-based bulk metallic glass
• Copper sorbents for
desulphurization of fuels and
natural gas (licensed)
• Copper catalyst for methanol-tohydrogen conversion
Slide 45
CO-FUNDED R&D CONSORTIA
EcoSea
GeoSol
Super Calefont
Slide 46
2006 TECHNOLOGY PROGRAM
Proposal
Code
TEK-1030
TEK-1014
TEK-1023
TEK-1003
TEK-1028
TEK-1033
TEK-1001
TEK-1017
TEK-1024
TEK-1029
TEK-1026
TEK-1018
TEK-1034
TEK-1021
TEK-1019
TEK-1022
MDP-0490
MDP-2737
TEK-1009
TEK-1007
TEK-1020
MDP-0750
TOTALS
Slide 47
Proposal Title
Copper motor rotor commercialization
Antimicrobial copper alloy surfaces for human health
R&D projects from CIMAT call for proposals
Flat tube condenser for air conditioning
Viscous alloy extrusion processing
GeoSolar system (Green Home)
Development of R&D network
Round tube/plate fin antibacterial evaporator
Copper plate heat exchanger
Condensing demand gas water heater (DGWH)
Tube corrosion research
Single-step production of multiport sections
China R&D opportunity identification
Deep-sea electrical power cables
Internal heat exchanger for CO2 aircon system
Siemens collaboration
Air-Conditioning & Refrigeration consortium
JCDA's Roadmap to future copper applications
Industrial design for new copper applications
Electromagnetic automotive transmission (MEGA)
Copper SSM
Technology Program management
Location of R&D
activities
US, CN, IN, JP
US, UK, EU, JP, CN, ZA
CL and global
US, UK, EU, JP, CN, ZA
US
JP, US
CN
CN
CN
US & more locations
UK
CN
NO
JP
DE
US
JP
Confidential
US
CURRENT SITUATION
Active for ~4 years
ICA funding: ~$12 M cumulative
External funding attracted: ~$12 M cumulative
Estimating 2006-2010 impact of 200,000 tonnes
($1.6 billion)
Major growth opportunities coming from
Technology
Global R&D Network established (140 active
researchers in 2006)
Commercializing R&D results
Slide 48
SYSTEM ARCH. FRAMEWORK
_________________________________________________
Source – Ed Crawley, MIT, ESD34.J
Slide 49
Example Project
Copper Alloy Fish Cages
Slide 50
BEYOND R & D
Traditional CTO management roles:
• R = Research (market and technical)
• D = Development (leadership)
• E = Engineering
Additional disciplines required at CTO level
• C = Connect (partner selection, contracts, IP, value
sharing and motivation matching)
• M = Commercialization (funding, business development)
New opportunities and innovations arise from
making creative connections and moving to market
Slide 51
TECHNOLOGY TRANSFER
Copper alloy enclosures for the cultivation of
marine organisms in their natural habitats
Proven in Japan
Yellow tail
Slide 52
Needed in Chile
Salmon
AQUACULTURE CAGES
Fish cages made of
copper alloys
• Resist fouling
• Have low corrosion rates
• Resist attack by marine
mammals
• May prevent growth of
infectious bacteria
• Are recyclable at end of life
Reduce operating costs
Slide 53
1976 INCRA PROJECT
Slide 54
RATIONALE IN 1976
Farmed fish production doubled 1970-1975
Production at 4.5 million kg/year; 10% of global
fish supply
US alone is $800 million retail industry
Growth should continue
• Open ocean fish stocks declining due to pollution and
over-fishing
• Western countries more health conscious and eating
more fish
• Price of fish rising making farming potentially more
profitable
Slide 55
RATIONALE IN 1976
Fast growth has been in low labor cost countries
with traditional practices
Slow growth in technologically intensive countries
• Little scientific research focused on making aquaculture
a profitable venture
• Large companies not willing to take the risks involved in
investing in large-scale aquaculture businesses
INCRA’s floating copper-nickel fish cage could
accelerate growth of aquaculture
• More cost-effective technology
• Focus on luxury crops such as salmon, trout and oysters
Slide 56
ADVANTAGES OF Cu-Ni CAGES
No biofouling
• Avoid the costs, fish stress and nuisance of net changes
• Healthy fish - maintain level of oxygen and water-borne
nutrients
• 5% blockage after 18 months of submersion vs 75%
blockage for nylon net with copper antifouling coating
More fish per cage
Avoid predator attacks
Reduced labor costs
Slide 57
CAGE CONSTRUCTION
Expanded 90/10 coppernickel sheet
• 76% open area
• Proven anti-fouling
Rigid modules with
fiberglass frames
• 1 x 3 meter panels
Assembly into different
shapes as needed
Floats covered with 90/10
copper nickel
Slide 58
WHY EXPANDED METAL
Many material forms
considered
• Wire mesh (welded and
woven)
• Fine braided wire woven
into netting
• Perforated sheet
Expanded metal selected
because it gave lowest
cost cage
• $26.23/m3
Slide 59
WHAT WENT WRONG?
Expanded metal rigid cages cost effective but not
the right choice for the application
• Flexibility important
• Some biofouling caught in corners of expanded metal
• Not easily scaleable to large enough volume
Industry grew faster than expected and needed
proven, risk-free technology
Cost analysis based on 10-year cage life and no endof-life value
No entrepreneurial drive
Slide 60
EXPERIENCE IN JAPAN
Slide 61
JAPANESE TECHNOLOGY
Netting material provided by
SAMBO (Japanese subsidiary of
Mitsubishi Materials)
Second generation material
Unique alloy: low corrosion,
antifouling, high strength,
abrasion resistant
Chemical composition (wt. %)
• 64 Cu, 35 Zn, 0.6 Sn, 0.3 Ni
Formed into woven wire net
200 current net installations
Slide 62
JAPANESE TECHNOLOGY
Cage design,
construction and
installation by Ashimori
12m x 12m x 10m deep
Slide 63
JAPANESE TECHNOLOGY
UR30 net after 4 years in Japan
UR30 net after 5 months in Chile
Nylon net after 5 months in Chile
Slide 64
REAL BENEFITS IN JAPAN
NO maintenance or net changes over 4 years
• No cleaning costs
• No cost for disposal of biofouling on nylon nets
• No net change costs
• No loss of fish due to stress of net changes
NO antibiotics – NO disease
NO parasites – NO fresh water immersion
NO predator perimeter net required
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REAL BENEFITS IN JAPAN
Lower environmental copper release
• Constant low level release (about 30% of nylon nets
coated with copper-based paint)
50% more fish per cage
10-15% faster fish growth
More profit at lower cost
A clean technology
• Higher consumer acceptance
• Lower environmental impact
• More profitable
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A HAPPY FISH FARMER
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AN OPPORTUNITY FOR CHILE
Transfer of Japanese technology to Chilean
industry
• Woven brass alloy cage well suited to salmon culture
• All production, from metal mining to installed cage, by
Chilean companies
Cage leasing to overcome high initial cost
CleanTech approach
• Reduced environmental impact from salmon production
• Complete metal recyling at end of cage life
• Strong economic benefits
• Much better than copper antifouling coatings!!!
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ECOSEA PARTICIPANTS
ICA – initiation, organization, research and funding
Intesal – Chilean salmon industry research institute
Universidad de Concepcion – research assistance
Mitsubishi Materials – copper alloys for fish cages
Codelco – project management
Ashimori – fish cage fabrication and installation expertise
Madeco – production of copper alloy wire in Chile
Rivet – wire weaving for fish cages in Chile
Aqua Cards – fish cage fabrication and installation in Chile
Various salmon farms in Chile
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COPPER ALLOY SALMON CAGES
Resist fouling
• More oxygen equals faster growth
• Higher conversion factor
• Allow more fish per cage
Resist attack by marine mammals
Reduce operational complexity
• Avoid net changes
• Avoid the need for antibiotics
Lower environmental impact
• Lower low copper ion release
• No liquid or solid wastes
• Are recyclable at end of life
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2006 SUCCESS FACTORS
Better alloy material
proven in
Merge market and Technology
Pre-competitive
technology insights use;research/development
in better form
needs adaptation
Technical capabilities
• Properties
• Processes
Technology feasibility
demonstration
Technology transfer to
local industry
Commercialization
Member/supply chain
participation
New copper
application
Application knowledge
• Industry pain points
• Market dynamics
Deeper understanding
of industry needs
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Market/business
innovation
Leasing business model to
lower capital cost
Venture creation /
entrepreneurial effort
Business consortium with
government co-funding
SUMMARY
Identify and develop network of relationships
Define a vision, processes, and gain buy-in
Find opportunities worth pursuing
Devote the effort needed to succeed
Plan for commercialization early in the process
Combine technological advances with business model
innovation
Gain leverage from partners
Encourage entrepreneurial efforts
Systems thinking essential
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Creating and Executing a Technology
Strategy for a Global Industry
Hal Stillman
Director of Technology
International Copper Association, Ltd.
20 October 2006
hstillman@copper.org
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