A Place to Stand

Spaceship One & its team - winners of the first, £6 million, X-Prize

I have been requested to contribute here as a result of making an FoI enquiry which found that the government had made no investigation whatsoever of a method of funding which recent evidence suggests would provide a minimum of 33 times better value for money than contemporary methods of funding innovative technology. Thus according to the US government "For less than $10 million in prize money and expenses, [actually only $3 million in prizes] the Department of Defence has created new technology that would have otherwise cost more than $100 million", http://www.strategypage.com/htmw/htarm/20090818.aspx

I am doing this as a private citizen. Although I run a relatively popular blog http://a-place-to-stand.blogspot.com/ & have blogged extensively on this & other technology related subjects. I would not claim that my thoughts represent reader's.

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PROPOSAL

That the £268 million annually currently put into ESA should instead be given to an X-Prize Foundation

ESA is an ineffective bureaucracy in which far more attention is given to ensuring contracts are divvied out to each country than to even putting a man in space - something competitors did nearly 50 years ago. There is no likelihood that anything related to ESA will ever be at the cutting edge of any sort of space development.

X-Prizes are prizes given for new achievements in technology. That's it. One puts up a prize & the first eligible person or group (in this case a British company or citizens) to achieve it gets the money. This does not effect their patent rights. Cutting edge technology often has little immediate non-military payback though in the long tern whole industries grow out of it. The value of achievements usually far exceed anything government programmes could do. Indeed government programmes, precisely because of the mindset, are very poor at producing products which can be utilised at commercial rates as the $1 billion a launch NASA shuttle, compared with a flight to Australia which, in theory at least, requires a comparable amount of energy, shows.

Prizes have a long & successful record of spurring technological progress from the time the King of Syracuse offered a prize to anybody who could develop a way of measuring the purity of gold, through the Spanish longitude prize not being won but nonetheless giving the world modern maps; the British longitude prize won by John Harrison; the prize put forward by a billiard ball company for a substitute to elephant ivory, which started the plastic industry; Lindbergh's winning of one for the first solo flight across the Atlantic. The world X-Prize Foundation funded the $10 million prize that produced Spaceship One & kickstarted Virgin Galactic.

Space precludes a fuller description of the long & overwhelmingly successful record of funding technological progress by prizes but certainly it has worked & does work much better than any other method of government funding. See;
Recent success,
NASA assessment paper,
h More historic examples ,
Gingrich on X-Prizes ,
BT funding X-Prize Foundation going worldwide,
John McCain's X-Prize for a better battery,
X-Prizes in history ,
proposed small scale prize,
SNP's sea turbine prize

A British X-Prize Foundation should be funded with the money currently given to ESA guaranteed to grow proportionately with the growth in Britain's current £6.5 billion space industry plus 5%. British space industry is currently growing at 5% annually which is clearly a matter of pride for the ministry. America's is growing at 17.6%. This would therefore have no immediate net cost to the Exchequer & the long term increase would be merely a very small part of the gain from the concomitant expansion of the industry. Such a long term commitment to an independent body would provide security to all parties & allow the Foundation to offer prizes on the basis of assets several years in advance since even the most enthusiastic supporters would not expect it to produce a commercial British orbital craft in under 3 years. The body should consist of about 5 commissioners drawn from successful engineers, scientists & technology venture capitalists to decide on what prizes to institute. It would require only a very small staff to determine that applicants counted as British & the achievement had indeed been made.

The first prize offered should be for an orbital space vehicle.

Robert Heinlein said "When you are in Earth orbit you are half way to anywhere." The point being that the energy cost & difficulty of achieving orbit is at least as great as getting from orbit to ANYWHERE in the Solar System.

Consequently achieving an inexpensive commercial orbital craft is at least as important now as all other possible space projects put together.

NASA have clearly failed to do that with the Shuttle. ESA are not even in the business of trying. China & Russia, possibly in combination, may well manage it. However the best way to produce a commercial launcher is a commercial X-Prize.

To quote Dr Jerry Pournelle (former NASA scientist & chair of the Citizen's Committee that persuaded Ronald Reagan of the utility of the SDI programme:

"I am rapidly reaching a conclusion, confirmed by a number of those in the rocket entrepreneurial community, and also several Pentagon people: if we stay outside NASA, the technology exists to build a reusable orbiter for under a billion dollars; probably far less than a billion.

This could be done by prizes, and at the moment there are two prize schemes to consider: a single prize of $1 billion (£600 million), or a first and second prize of $500,000,000 for first and $250,000,000 for second (£300 m & £150 m. The notion of a second prize is intriguing but harder to sell. A second insures that more than one firm can raise capital to compete. " http://www.jerrypournelle.com/view/2008/Q3/view532.html#Tuesday

That is 2 years worth of what we put into ESA, though personally I would suggest a little more. When we are discussing access to the Universe there is no point in cheeseparing. It should be noted that if this does not work then, such is the nature of prizes, no cost is involved. Thus even the most sceptical, indeed arguably specially the most sceptical, can have no objection to it.

Here is a link giving the fully run of proposed prizes as originally stated by Dr Pournelle http://www.jerrypournelle.com/topics/gettospace.html

I am willing to answer any further questions on the subject or assist in any other way.

As pointed out in my FoI enquiry BNSC has a legal duty to "help industry maximise profitable space based business opportunities." I do not think it can credibly be denied that X-Prizes will do more, indeed many orders of magnitude more, to provide such opportunities than funding ESA. If anybody wishes to say otherwise I will be very interested to read & hopefully get a chance to respond to an argument which I have never seen specifically made anywhere else. There may be arguments that it is politically useful to fund ESA but that would not be part of the BNSC's brief & other departments, probably particularly the Foreign Office should certainly be allowed to fund ESA form their own budgets, if they so desire, so long as it does not impinge on the British space budget.

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This is the submission I have sent to BNSC following my FoI enquiry. It was sent to ukspaceconsult@bnsc.gsi.gov.uk
Anybody else with suggestions should do the same by Oct 14th when the consultation ends.

See also http://www.bnsc.gov.uk/assets/channels/about/UKCSS0812.pdf & http://www.bnsc.gov.uk/consultations/main.aspx?id=1

Any reader who feels that the BNSC should consider this option seriously is invited to send a short email simply saying that to the given address. If you would like to CC a copy to me on crgn143@aol that would be appreciated. I have no doubt whatsoever that X-Prizes would be orders of magnitude more useful at promoting British space industrialisation than giving the money to ESA & that any impartial investigation will find this to be the case.

Labels: Fixing the economy, space, X-Prizes

Archimedes having a prizewinning idea

I ran across this article by Benjamin Krohmal on historic technology X-Prizes & related. The ones I have checked & have dealt with before are reduced to the heading:

1714 - Longitude Prize

1721 - French Royal Academy Prize Questions

In 1721, the French Royal Academy of Sciences began offering regular scientific and mathematical “prize questions” and offering a Grand Prix medal for the best solution. While no cash prizes were awarded, the medals were potentially career-making honors and stimulated considerable research on the selected questions. Prize-winners included Maclaurin for his work in kinetics and Coulomb for work on magnetic compasses.

1775 - Alkali Prize

1795 - Napoleon's Food Preservation Prize

1820 - Montyon Prizes

In 1820, the French Royal Academy of Sciences began offering large monetary awards after a private donor established the Montyon Fund for prizes in medicine. The Montyon prizes were designated for solutions to pre-specified medical challenges, with reward amounts intended to be “proportional to the service” of the innovator. The Academy struggled with applicants’ failure to disclose negative results, while some suggested that the Academy itself was corrupt as there was little transparency in awarding the prizes and un-awarded funds reverted to the Academy’s coffers. Nonetheless, an unprecedented 283,000 francs in prizes were awarded between 1825 and 1842. In 1860, a young Louis Pasteur was awarded a Montyon prize for his work in physiology, and the winnings subsidized much of his subsequent groundbreaking research. In the mid-1800’s, private contributions to the French Royal Academy lead to the establishment of dozens of additional monetary prizes. These included the Jecker Prize, established in 1851 “to accelerate the progress of organic chemistry” and the Breant Prize in 1858 offering 100,000 francs for a cure for cholera. Charles Friedel was among the winners of the Jecker Prize for his now famous Friedel-Crafts reaction. The main Breant Prize was never awarded, though it propelled more research on infectious diseases that was rewarded with subsidiary prizes. Pierre and Marie Curie received multiple prizes from the Academy between 1895 and 1906. The French Royal Academy gradually transitioned from offering prizes to grants in the late 19th and early 20th centuries.

1823 - Turbine Prize

In 1823 the French Society for the Encouragement of Industry offered a prize of 6,000 francs for the development of a large-scale commercial hydraulic turbine. The prize was won in 1827 by then 25 year-old Benoit Fourneyron. His turbine was placed in the public domain and was immediately implemented across Europe and helped to power the burgeoning New England textile industry.

1895 - Chicago Times-Herald Prize for Motors

In 1895, the Chicago Times-Herald offered a $5000 Prize for Motors to be awarded for the development of "practicable, self propelling road carriages,” as determined by a 54-mile race. The winner was J. Frank Duryea. Even more than the prize money, the publicity generated did much to promote investment in automotive innovation.

1900 - Deutsche Prize

In 1900, Henry Deutsch de la Meurthe offered the Deutsche Prize of 100,000 francs for the development of an airship that could be flown on an 11km course around the Eiffel Tower in under 30 minutes. Alberto Santos-Dumont became an international sensation after being awarded the prize in 1901, despite exceeding the time limit by 40 seconds. After Santos-Dumont’s success, the Brazilian government matched the prize money he received.

1907 Deutsche-Archdeacon Prize

1908 - Scientific American Prize

In 1908, the magazine Scientific American offered a prize of $2,500 to the first airplane in America to publicly fly for 1km. Glenn Curtiss won the prize the same year.

1909 - English Channel Crossing Prize

1909 - Rheims Airshow Prizes

Also in 1909, several prizes for speed, distance, and altitude were offered at the Rheims Airshow. Glenn Curtiss won two prizes for speed, including the Gordon Bennett Prize, and launched an airplane manufacturing business with his winnings.

1910 - Milan Committee Prize

In 1910, the Milan Committee offered a prize of 160,000 lire for the first pilot to fly a plane over the Alps between Switzerland and Italy. The prize was won the same year by Gorges Chavez, but his winning flight ended in a crash and the pilot died four days later.

1910 - Hearst Prize

Also in 1910, William Randolph Hearst Offered $50,000 to the first pilot to fly across the U.S. in under 30 days. Though there were some attempts, the prize expired in 1911 without a winner.

1913 - Daily Mail Tans-Atlantic Prize

1919 - Orteig Prize

1931 - Soviet Committee for Invention

In 1931, the Soviet Union implemented a Committee for Invention offering payment for new inventions determined by a sliding percentage of the cost savings produced after three years of use. Non-monetary social privileges were also offered as rewards. The patent system was left in place, but application fees were high and patents were made less valuable by market controls. The amount of the rewards was increased in 1942 after innovation declined, but by most accounts the rewards remained too low to promote optimal levels of innovation. The system continued until the collapse of the Soviet Union in 1991.

1946 - U.S. Patent Compensation Board

In 1946, the U.S. Patent Compensation Board was established to provide an incentive for private innovations in atomic energy that were no longer eligible to be patented for security reasons. The Board considers the cost and usefulness of inventions in determining how much to reward inventors, but reward amounts have been criticized for being too low; Enrico Fermi received only $300,000 for his patented process for the production of radioactive isotopes. The Compensation Board remains in place today, but largely fails to stimulate private sector innovations in atomic energy.

1948 - Wolfskehl Prize

1958 - NASA Space Act Awards

In 1958, NASA established the Inventions and Contributions Board with the authority to offer Space Act awards of up to $100,000 for technological developments in aeronautics that contribute to NASA's goals. The program is still in place, and dozens of prizes have been awarded.
1959 - Feynman Prizes

1959 - Kremer Prizes

1980 - Fredkin Prize

1990 - Loebner Prizes

In 1990, Hugh Loebner and the Cambridge Center for Behavioral Studies offered the $100,000 Loebner Prize for the first computer to pass the “Turing Test” for artificial intelligence. The grand prize has not yet been won, but $2,000 prizes are awarded annually for the most significant advances in computer natural-language processing and artificial intelligence.

1991 - FCC Pioneer Preferences

In 1991, the U.S. Federal Communications Commission (FCC) established the Pioneer Preference Program, offering a reward of preferential licensing (worth many millions of dollars) for the development of new spectrum-using communications services and technologies. Five companies received the reward before the program ended in 1997, and a sixth, Qualcomm, was granted the award for its development of digital wireless technology after a legal appeal.

1992 - Super Efficient Refrigerator Program

1994 - Rockefeller Prize

In 1994, the Rockefeller Foundation offered a prize of $1 million for developing a low-cost highly accurate diagnostic test for gonorrhea or chlamydia that could be easily administered in the developing world. The prize expired in 1999 without a winner, and has been critiqued for being too small, too inflexible, and offered for too short a period of time.

1995 - Ansari X Prize

1996 - Forsight Institute Feynman Prizes

In 1996, the Foresight Institute announced the $250,000 Feynman Grand Prize to be awarded for two specified breakthroughs in nanotechnology. The Grand Prize has not yet been won, but in the meantime the Feynman Institute awards $20,000 annually for the most significant advancements in nanotechnology.

1997 - Budweiser Challenge

1997 - Cheap Access to Space Prize

In 1997, the Space Frontier Foundation and the Foundation for International Non-governmental Development of Space (FINDS) announced the $250,000 Cheap Access to Space (CATS) Prize for the first private team to launch a 2kg to an altitude of 200km. Two launches were made, but the prize expired in 2000 with no winner.

1999 - Cooperative Computing Awards

In 1999, the Electronic Frontier Foundation announced its Cooperative Computing Awards, offering a total of $550,000 in prizes for the discovery of very large prime numbers. The intent of the Awards is to encourage computer networking for the solution of complex computational problems. Nayan Hajratwala won $50,000 in 2000 for discovering a prime number with over 1 million digits with the help of tens of thousands of networked computer users. Prizes for 10 million digits, 100 million digits, and 1 billion digits have not yet been awarded.

2000 - Millennium Grand Challenge in Mathematics

In 2000, the Clay Mathematics Institute announced the Millennium Grand Challenge in Mathematics, offering a combined $7 million; $1 million each for a proof or counterexample to any of seven classical conjectures in mathematics. The prize announcement received considerable public attention. Grigori Perelman was confirmed to have solved one of the seven conjectures in 2006, but he declined the award.

2000 - Goldcorp Challenge

2001 - Innocentive

The now independent company InnoCentive was founded by Eli Lilly in 2001 as a registry for scientific innovation prizes. Companies post specific scientific needs, a prize amount, and a deadline. The innovator providing the best solution is awarded the prize. To date, over 80 prizes have been awarded.

2003 - DARPA Grand Challenges

2003 - Methuselah Mouse Prize

In 2003, the Methuselah Mouse Foundation announced a prize for the development of long-lived genetically engineered mice in order to promote longevity research. The foundation solicits private donations to increase the prize amount, which now stands at more than $4 million.

2004 - Project Bioshield

In 2004, the U.S. enacted Project Bioshield, which includes a provision for automatic government payment to procure newly developed “qualified countermeasures” against bioterrorism. By most accounts, the program has done a poor job of stimulating private R&D on bioterror countermeasures.

2004 - NASA Centennial Challenges

In 2004, NASA announced the first in a series of Centennial Challenges, initially offering prizes from $50,000 to $250,000 for private sector development of specific technologies to advance space exploration. To date, six Challenges have been announced, two have expired with no winner, and five additional Challenges are scheduled to be announced in 2007. Current Challenges include the $2 million Lunar Lander Challenge.

2005 - Medical Innovation Prize Act

In 2005, former Congressman Bernie Sanders introduced a bill, the Medical Innovation Prize Act of 2005, that called for devoting .5% of U.S. GDP annually to be paid to the developers of new pharmaceuticals in lieu of standard patent market exclusivity. New drugs would be open to generic competition as soon as they received FDA approval, with prize payments from over a ten year period serving as an alternative incentive for private innovation. The Act called for prize payments to be linked to the incremental medical benefit provided by a new product, meaning that the fund would be dived between the developers of new drugs on the basis of the relative medical utility of their products. The intent of the bill was "to provide incentives for the investment in research and development for new medicines" and to "enhance access to new medicines."

2005 - Grainger Challenges

In 2005, the National Academy of Engineering announced the first in a planned series of Grainger Challenges, offering a $1 million first prize and $200 and $100 thousand second and third prizes for the development of economical filtration devices for the removal or arsenic from well water in developing countries. Over 70 entries were submitted, and Abul Hussan was announced the winner in 2007 for his SONO filter that has already been implemented to provide safe drinking water to 400,000 people.

2006 - Archon X Prize for Genomics

In 2006, the X Prize foundation announced the Archon X Prize for Genomics, offering $10 million for reaching targets for high speed and low cost in full genome sequencing.

2006 - Netflix Prize

In 2006, Netflix offered a prize of $1 million for a system to more accurately predict consumer preferences; specifically for a 10% improvement over Netflix’s current accuracy in predicting whether a customer will like a movie given previous selections.

2006 - Ibrahim African Leadership Prize

In 2006, businessman Mo Ibrahim announced a $5 million annual award for a former African head of state who has ceded power after significantly contributing to the welfare of his or her constituents. The prize is intended to reduce corruption as well as promote effective development strategies.

2007 - Virgin Earth Challenge

In 2007, Sir Richard Branson and former U.S. Vice President Al Gore announced the $25 million Virgin Earth Challenge for “a commercially viable design which results in the removal of anthropogenic, atmospheric greenhouse gases so as to contribute materially to the stability of Earth’s climate.” In announcing the prize, Branson cited inspiration from previous innovation prizes, including the Longitude Prize, French prizes for alkali and canning, and 20th century prizes for automobiles and aviation.

2007 - Pneumococcal Vaccine Advance Market Commitment

Later in 2007, Canada, Italy, Norway, Russia, the United Kingdom, and the Bill & Melinda Gates Foundation announced a $1.5 billion “Advanced Market Commitment” or AMC for pneumococcal vaccines. The AMC specifies requirements for new pneumococcal vaccines and pledges $1.5 billion to heavily subsidize the purchase of eligible vaccines for use in developing countries, in effect offering a prize for the development and delivery of effective vaccines. Backers suggest the AMC will speed delivery of vaccine to developing countries by 10 years and save the lives of 5.4 million children by 2030.

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And here is a pdf of a paper entitled
PATTERNS OF PATRONAGE - WHY GRANTS WON OVER PRIZES IN SCIENCE

"We can say that any society with prizes or medals paid for results, and that any society with salaried researchers, pensions, or expeditions paid for effort. If publications and courses are set aside as difficult to classify, the remainder of society activities can be thought of as paying for overhead. Thus, of our 135 eighteenth century societies, 47 paid for results, 20 paid for effort, and 47 paid for overhead...

Today, it seems, patrons of basic research pay more for effort and less for results than they once did ...

But why would scientists have pushed grants if grants were not a superior institution?
Well not all of them did – for example, on both occasions of increased British state grants,in 1850 and 1876, the then-Presidents of the Royal Society privately expressed strong reservations, such as a fear of personal jobbery and bureaucratic formalism [17].
More important, big grant advocates were typically associated with leaders of the scientific societies, and grant-like patronage gave these leaders more discretion regarding the money that passed through their hands...

Baron Montyon endowed two very large annual Academy prizes for “making some industrial process less unhealthy”, and for “improving medical science or surgery” Instead of the usual prize competitions, however, the [French] Academy funded the academy journal, some general retrospective awards, and some grants (still called “prizes” to avoid legal challenges), which from the 1850s on were often awarded for non-medical topics. These awards were also often made secretly to avoid criticism, even though the Academy claimed it published all such decisions ...

in 1900, the Royal Society of London declared they would accept “no further bequests to be awarded as prizes for past achievements”...

[after a lot of statistical calculation]

a statistical model has been constructed to predict the combinations of grant-like and prize-like patronage among eighteenth century scientific societies. This model successfully predicts today’s dominant form of basic research patronage, mostly grant-like and not prize-like, and such predictions rely more on patron types
than on a proxy for scientific professionalization. If further research confirms these results on patterns of patronage, including direction-of-causation assumptions, then research into the historical transition from grants to prizes
might do well to examine the role of patron types in more detail. Grants may have won not, as their advocates claimed, because they were a superior institution, but instead because non-local and non-autocratic governments tended to prefer them.
I have suggested that such governments might prefer grant-like funding to prize-like funding because they were susceptible to distributive pressures from leaders of scientific societies, who preferred the “pork” of increased discretion over the money that passed through their hands.

[ie that organisations (originally scientific societies, later government) find it preferable to hand out grants to people known to them than to pay for results which may come from any common ragamuffin, like the Wright brothers, & modern "democratic" leaders with these massive bureaucracies to keep fed are more interested in political pork barrelling & less in putting their name to some permanent achievement than earlier monarchs]

Labels: Government parasitism, Science/technology, X-Prizes

I did an article on historic X-Prizes previously. Well here are edited excerpts from comments on a Spacepolitics discussion on the subject which adds a lot more:

Bill wrote @ June 10th, 2007 at 8:58 am
I worked for Newt in the 90s), but here’s a mid-90s quote from the Speaker:

“We want to explore the use of prizes, which have been used in the West since the late Seventeenth Century and have had a big impact… We want to explore the use of prizes where, if we have a goal we want to achieve, let’s set up a prize and whichever entrepreneur gets there first gets the money.”
Newt Gingrich, 1995

[http://seds.org/xprize/X.html]

Newt was also one of the key figures in saving DC-X in the early 90s [http://www.hq.nasa.gov/pao/History/x-33/facts_5.htm]


Ray wrote @ June 11th, 2007 at 9:59 pm
... there’s a Mars Prize that was won just a few days ago: the $5,000 University Mars Rover prize by the Mars Society.

http://www.marssociety.org/portal/c/urc/frontPage

anonymous wrote @ June 12th, 2007 at 2:35 am
A follow-up post with a more complete list of technology inducement prizes have initiated and/or transformed whole companies and/or industries:

...1775 - Alkali Prize

In 1775, King Louis XVI offered a prize of 2,400 livres to anyone who found a commercially viable artificial process for the production of alkali. Naturally occurring alkali was used in paper, soap, and glass production, but discovery of an artificial process in 1791 by Nicolas Leblanc enabled much greater production and launched the French chemical industry.

1795 - Napoleon’s Food Preservation Prize

In 1795, Napoleon’s Society for the Encouragement of Industry offered a 12,000 franc prize for a method of food preservation to help feed Napoleon’s army. Nicolas Appert devised a solution using champagne bottles in 1809 and was awarded the prize in 1810 on the condition that he publish his methods. The discovery marked the beginning of the canning industry.

1820 - Montyon Prizes

In 1820, the French Royal Academy of Sciences began offering large monetary awards after a private donor established the Montyon Fund for prizes in medicine… In the mid-1800’s, private contributions to the French Royal Academy lead to the establishment of dozens of additional monetary prizes. These included the Jecker Prize, established in 1851 “to accelerate the progress of organic chemistry”… Charles Friedel was among the winners of the Jecker Prize for his now famous Friedel-Crafts reaction.

1823 - Turbine Prize

In 1823 the French Society for the Encouragement of Industry offered a prize of 6,000 francs for the development of a large-scale commercial hydraulic turbine. The prize was won in 1827 by then 25 year-old Benoit Fourneyron. His turbine was placed in the public domain and was immediately implemented across Europe and helped to power the burgeoning New England textile industry.

1895 - Chicago Times-Herald Prize for Motors

In 1895, the Chicago Times-Herald offered a $5000 Prize for Motors to be awarded for the development of “practicable, self propelling road carriages,” as determined by a 54-mile race. The winner was J. Frank Duryea. Even more than the prize money, the publicity generated did much to promote investment in automotive innovation.

1903 - Deutsch-Archdeacon Prize

In 1903, French Aero Club members Earnest Archdeacon and Henry Deutsch de la Meurthe offered a prize of 50,000 francs to the first pilot to fly a heavier-than-air vehicle in a 1km circular course. Henry Farman won the prize in 1907, and went on to become a commercial airplane manufacturer.

1909 - Rheims Airshow Prizes

Also in 1909, several prizes for speed, distance, and altitude were offered at the Rheims Airshow. Glenn Curtiss won two prizes for speed, including the Gordon Bennett Prize, and launched an airplane manufacturing business with his winnings.

...2001 - Innocentive

The now independent company InnoCentive was founded by Eli Lilly in 2001 as a registry for scientific innovation prizes. Companies post specific scientific needs, a prize amount, and a deadline. The innovator providing the best solution is awarded the prize. To date, over 80 prizes have been awarded.

2005 - Grainger Challenges

In 2005, the National Academy of Engineering announced the first in a planned series of Grainger Challenges, offering a $1 million first prize and $200 and $100 thousand second and third prizes for the development of economical filtration devices for the removal or arsenic from well water in developing countries. Over 70 entries were submitted, and Abul Hussan was announced the winner in 2007 for his SONO filter that has already been implemented to provide safe drinking water to 400,000 people.

For those advocating lunar/asteroid sample return prizes, these two may be of interest:

1991 - FCC Pioneer Preferences

In 1991, the U.S. Federal Communications Commission (FCC) established the Pioneer Preference Program, offering a reward of preferential licensing (worth many millions of dollars) for the development of new spectrum-using communications services and technologies. Five companies received the reward before the program ended in 1997, and a sixth, Qualcomm, was granted the award for its development of digital wireless technology after a legal appeal.

2000 - Goldcorp Challenge

Also in 2000, the gold mining company Goldcorp introduced the Goldcorp Challenge: the company released all of its geological data on an underperforming Canadian mine, and offered $575,000 in prizes including a grand prize of $105,000 for the most accurate predictions of where to dig to find the most gold. Over 1,400 people participated from 50 countries, with 80% of 110 identified digging sites yielding significant quantities of gold. A partnership of two Australian companies using computer fractal technology won the grand prize in 2001.

The text above is excerpted from http://www.keionline.org/index.php?option=com_content&task=view&id=29.

Again, we shouldn’t oversell prizes. For example, there are a few failed prizes listed at the website above.

But neither should we make false claims constraining the limits of inducement prizes. History clearly shows that they can be a powerful tool for innovation.

Thomas Matula wrote @ June 12th, 2007 at 2:41 pm
Yes there were many failures, most of which are excluded from lists like this one, which is why prizes were replaced by grants in the 20th Century as a way for advancing technology. For example the website misses the Longitude Prize offered by King Phillip III in 1598 and a similar one offered by the Dutch in the same year. But then the technology for clock making was not advanced enough for the conditions of the prize. Even the Longitude Prize offered in 1714 took over 60 years to win and the inventor had to wait decades for payment while other clockmakers stole his intellectual property.

And from that same website you cited.

http://www.keionline.org/index.php?option=com_content&task=view&id=29

some other examples of prizes that advanced technology.

And we know how computer innovation was driven in the 1980’s and 1990’s by the Fredkin Prize.

[[[1980 - Fredkin Prize

In 1980, computer scientist Edward Fredkin offered a $100,000 prize for the first computer chess program to beat a reigning world chess champion. IBM’s Deep Blue Chess team won the prize in 1996 when their machine defeated Gary Kasparov.]]]

And even the successful Alkali Prize shows two of the problems with prizes – intellectual property ownership and getting the money you won.

[[[1775 - Alkali Prize

In 1775, King Louis XVI offered a prize of 2,400 livres to anyone who found a commercially viable artificial process for the production of alkali. Naturally occurring alkali was used in paper, soap, and glass production, but discovery of an artificial process in 1791 by Nicolas Leblanc enabled much greater production and launched the French chemical industry. Unfortunately for Leblanc, the French Revolution destroyed his alkali factory and prevented the King from giving Leblanc his award. Leblanc committed suicide in 1806, and it was not until 1855 that his heirs received the prize payment from the French government.]]]

Industry stole his invention, without compensation, while the King lost his head before paying the prize.

Same with the famous Napoleon prize for food preservation.

[[[1795 - Napoleon's Food Preservation Prize

In 1795, Napoleon’s Society for the Encouragement of Industry offered a 12,000 franc prize for a method of food preservation to help feed Napoleon’s army. Nicolas Appert devised a solution using champagne bottles in 1809 and was awarded the prize in 1810 on the condition that he publish his methods. The discovery marked the beginning of the canning industry.]]]

I expect the patent rights would have been worth far more the 12,000 francs, even in 1810.

Actually there is a very solid literature in economics on prizes and their role in innovation strategies. I will provide a reading list below tomorrow for those interested in actually learning something about prizes and technological development beyond the current hype.

However the Senate already knows the real advantages and limitations of prizes as Molly Macauley, a Ph.D. in economists who works for the group Resources for the Future testified on it at the Senate hearings on the Centennial prizes.

A copy of her testimony is located here.

http://www.rff.org/Documents/RFF_CTs_04_macauley.pdf

It’s a pity space advocates ignore it. Instead, they believe like the Soviet economists believed, that prizes are the ultimate solution and a substitute for markets and ROI. The results of Soviet economic policy show the risks of basing a national technical innovation policy on prizes as many libertarians propose…

Also from the website http://www.keionline.org/index.php?option=com_content&task=view&id=29) to a number of academic and political papers on the economics of prizes (in the “Papers” section on the right side).

...Here’s an old Mars Society document that has a section on a “Mars Prize” about the size of the one we’re discussing. The prize part is on pages 10-11. You can see that it proposes a few smaller prizes to develop “building blocks” for the big prize.

http://chapters.marssociety.org/usa/dc/pdfSRC/BriefingBook2001.pdf

Even the smallest prize in this proposal is huge compared to the prizes that are actually out or trying to get funding.

Anon June 15th

It’s hard to find examples on either side of the Atlantic where European-style government loan subsidies have produced an independent, profitable, going concern, nevertheless an independent, market-leading competitor. Governments are notoriously bad at picking the right private sector solution; the government loan subsidies choke off much greater amounts of private sector investment and competition; and it’s very difficult to wean companies off government loan subsidies once they become reliant on the low cost of capital.

Thomas Matula wrote @ June 18th, 2007 at 6:30 pm
Even adjusted for inflation, the $10 million X-Prize was probably the largest prize in history and is clearing approaching the limit for practical prizes. I am being generous when I place that limit at a $100 million. And that limit would only work if there are major markets waiting for the winning entry, and even for the also rans.

Thomas Matula wrote @ June 18th, 2007 at 6:41 pm
Al,

Exactly. The Russians invested directly in the development of new rocket engines. They did not offer prizes for them.

Thomas Matula wrote @ June 18th, 2007 at 6:41 pm
...Here is the list of articles I indicated;

Arrow, Kenneth J. (1969). ‘Classificatory Notes on the Production and Transmission of Technological Knowledge,’ American Economic Review, 59: 29-35.

Che, Yeon-Koo, and Ian Gale. 2003. Optimal design of research contests. American EconomicReview 93 (3):646-671.

Crawford, Elisabeth 1980. The prize system of the academy of sciences, 1850-1914. In Robert Fox and George Weisz, editors, The organization of science and technology in France 1808-1914, pages 283–307. Cambridge University Press, Cambridge.

Crosland, Maurice 1979. From prizes to grants in the support of scientific research in France in the nineteenth century: The montyon legacy. Minerva, 17(3):355–380.

Crosland, Maurice and Antonio Galvez, 1989. The emergence of research grants within the prize system of the french academy of sciences, 1795-1914. Social Studies of Science, 19:71–100.

Hanson, Robin Hanson 1998. Patterns of Patronage:
Why Grants Won Over Prizes in Science. http://hanson.gmu.edu/whygrant.pdf

Harry Paul. The trouble with prizes. In From Knowledge to Power, The Rise of the Science Empire in France, 1860-1939, pages 288–293. Cambridge University Press, 1985.

Llobet, Gerard, Hugo Hopenhayn, and Matthew Mitchell 2000. Rewarding Sequential Innovators: Prizes, Patents and Buyouts, Federal Reserve Bank of Minneapolis Research Department Staff Report 273

Macauley, Molly K. 2005. Advantages and disadvantages of prizes in a portfolio of financial incentives for space activities. Space Policy 21 (1):29-39.

Moldovanu, Benny, and Aner Sela. 2001. The optimal allocation of prizes in contests. American Economic Review 91 (3):542-558.

Nalebuff, Barry J., and Joseph E. Stiglitz. 1983. Prizes and incentives: Towards a general theory of compensation and competition. Bell Journal of Economics 14 (1):21-43.

National Academy of Engineering (NAE). 1999. Concerning federally sponsored inducement prizes in engineering and science. Washington, DC. http://newton.nap.edu/catalog/9724.html.

Shavell, Steven, and Tanguy van Ypersele. 1999. Rewards versus intellectual property rights. Cambridge, MA: National Bureau of Economic Research.

Jack Sommer. A radical proposal for reorganizing research support: Lotteries, prizes. The Scientist, pages 11,13,17, June 10 1991.

Taylor, Curtis R. 1995. Digging for carrots: An analysis of research tournaments. American Economic Review 85 (4):872-890.

Wright, Brian D. 1983. The economics of invention incentives: Patents, prizes, and research contracts. American Economic Review 73 (4):691-707.

The research is clear on the conditions for successful prizes. It must be a task a group of individuals are able to accomplish with self-funding, or a single patron. If a firm it must fall under their high risk R&D budget. This is the key limit on the pool of applicants and the smaller the pool of applicants the less likely it is a prize will be won.

Given how close the x-prize came to failing, only a single team was able to raise the funds to make an attempt a bare 3 months before the prize vanished, shows how critical this is. And it took that team 2.5 times the amount of the prize to succeed.

Other factors include the promise of commercial markets following the prize. The high start-up cost of Virgin Galactic, some $275 million and counting, makes it clear that even if some of the other teams had won they would not have had the deep pockets to take their entry to market as Burt Rutan/ Paul Allen were able to do.

And this leads to a third guideline. Structure the rules to favor an entry that is competitive in the marketplace after the contest. The classic failure in this regard was Richard Feynman nanotech prize of 1959 of $1000 to build a motor 1/64 of an inch wide. The winder simply used existing jewelry tools to make it creating no technology of value to nanotech.

In terms of the lunar prize below, or the Mars prize, no follow-on markets exists to sustain the technology, so likely solutions would be one off stunts, not major breakthroughs. So there would be even less incentives then the X-prize.

anon V-Prize for transatlantic sub orbital with "spaceports" http://spaceports.blogspot.com/2007/06/transatlantic-v-prize-being-organized.html
http://www.v-prize.com/

Caltech alumnus wrote @ June 19th, 2007 at 12:19 pm
Dr. Matula,

You are mistaken. By classifying it as a “failure” you are leaping to the conclusion that Feynman’s objective was to develop new technology or to build a nanotech industry.

This motor has been on prominent display, for many years, in the physics building where Dr. Feynman used to work. I saw the display in the early 1980s when I was a student, and Dr. Feynman was still alive, and I believe it was there long before I ever set foot on campus.

If Feynman’s intention had been to develop “new technology” or to kick-start the nanotech industry, it would have been quite easy for someone of his stature to persuade somebody to fund another prize, of much more challenge. All he had to was ask, and people would have jumped at the chance to fund such a prize. The fact that he did not strongly suggests that he considered the prize to be a success.

Thomas Matula wrote @ June 19th, 2007 at 2:17 pm
CalTech Alumni

Richard Feynman offered two prizes for $1,000 of his own money with the hope of jump starting nanotechnology.

The first was for an electric motor. The full story is here.
http://news.bbc.co.uk/2/hi/science/nature/3785509.stm
Tuesday, 8 June, 2004, 11:23 GMT 12:23 UK
Small world’s big achievement
By Roland Pease
BBC radio science

Some quotes:
[[[Richard Feynman had specified a working electric motor no more than 1/64th of an inch on a side, confidently expecting making such a device would take an entirely new approach to engineering. Bill McLellan proved him wrong.

"He'd seen a lot of cranks come in with motors who didn't understand the challenge and I brought in a big box, and he said 'Uh-oh, here's another one of them'. And then I opened my wooden box and there was my microscope, and he said 'Oh! Nobody else brought a microscope!'".

But Feynman had to agree, the motor met his specification.]]]

And

[[["Feynman's disappointment was he didn't get the new method," says McLellan.]]]

So Richard Feynman himself regarded it as a failure.

So in summation the verdict of the literature and my statement that Richard Feynman prize was a failure stands. Indeed as indicated he felt that way himself.

And it is a lesson to be careful how you state the conditions of the prize.

benny wrote @ August 31st, 2007 at 1:59 am
It may be worth pointing out that a unique large prize is optimal only if cost is linear in effort. If costs raise quicker (say at a quadratic rate) then several prizes may be optimal. A good example is important architectural contests that offer 3-5 prizes, sometimes quite large. This is all spelled out in “The optimal allocation of prizes in contests” by Moldovanu and Sela, published in the American Economic Review, 2001

My comment - I don’t agree that large prizes are necessarily not going to work. Yes they would be beyond the guy & his brother teams (the Wrights & Rutans) but Exxon might well decide that an extra $20 bn on the ledgers was enough to make something like an atomic spaceship capable of reaching not just Mars but other places worthwhile. Though I do agree that cutting it into a lot of smaller prizes for steps along the way might work better.

In any case what is the downside? Offer $20 bn for the first Mars landing, if it is American & the Chinese get there first - no payout & the government still has the $20 bn. Perhaps a lot of people saying we should have put up $40 bn & let a small bank fail but the economy is not worse off than if no prize had been offered & the Chinese still got there first.

Equally this is not a competitor with NASA. Nasa get $18 bn & would want much more for a Mars ship but they get this annually. A $20 bn prize would probably take 15-20 years to be won & so is amortised over that period & government can certainly afford $1 bn a year or less depending on what interest rate is applied.

Equally whatever Feynman may have felt if you say not creating an entire new industry for an investment of $1,000 is a failure you have pretty tough success standards.

In the same way an X-Prize for getting various lengths & strengths of nanotube might have a much more innovative effect than letting much of the universe’s wealth go to whoever makes one 31,000 miles long & has a space elevator

My feeling is that the reason X-Prizes aren’t the normal way of doing things is because most government expenditure isn’t to achieve things but, as suggested above, to pay off political favours & provide permanent jobs to public employees. Cynical I know.

UPDATE Looking through Sobel's book Longitude I found a mention of the early Spanish Longitude Prize & a similar Dutch one which were classed as a failure because they werem't won. There is some backstory. Galilleo put forward a method of timekeeping making use of the timing of the orbits of the moons of Jupiter but it was judged, correctly, as unusable from the rolling deck of a ship. He did nevertheless get a gold chain from the Dutch. However this did work on land & where there was enough time for observation & thus directly created land maps resembling modern ones. Thus while a failure in its set objective & thus costing Spain nothing, it was actually pretty successful. This is an example of how good science almost always pays off even if serindipitously. In these terms it is remarkable how few of the prizes have failed to achieve anything & even those ones have been worth the money - ie zero.

John McCain has said that as President he would put up a $300 million dollar X-Prize:

“I further propose we inspire the ingenuity and resolve of the American people,” Mr. McCain said, “by offering a $300 million prize for the development of a battery package that has the size, capacity, cost and power to leapfrog the commercially available plug-in hybrids or electric cars.”

He said the winner should deliver power at 30 percent of current costs. “That’s one dollar, one dollar, for every man, woman and child in the U.S. — a small price to pay for helping to break the back of our oil dependency,” he said.

I'm for that. I don't think it is as useful as a prize for a reusable shuttle just because the immediate profits to be made on a battery are much clearer but $300 million would still help - indeed for the effect this would have it is probably too low a prize

Up till now I haven't been able to see which candidate I could feel strongly about (except Hilary but not in a nice way). McCain struck me as dangerous, in that he had supported bombing Yugoslavia & generally any sort of military action against anybody. Obama seems to be a complete chancer with lots of image, no sensible policies & unworthy of trust. On that basis, since our minimum interest is more that the US should do no harm than that it be run competently I inclined towards Obama. However if America can play a positive role in human development then that tops everything. By going for this system of encouraging innovation, even though a battery isn't my best target, McCain has shown that he gets the idea.

It is a much better target than Alex Salmond's £10 million ($20M) prize for a commercial sea turbine about which I waxed lyrical though I would like to think McCain had heard of & been influenced by it.

JunkScience rubbished it on the grounds that McCain, at the same time, suggested a massive tax break for electric cars, which is a true criticism but I think ignores political realities.

Jerry Pournelle said

The purpose of prizes is to focus attention on a goal. Lindberg fly to Paris alone for a prize. Prizes did a lot for early aviation. The X Prize got a lot of attention for commercial space. Heinlein left much of his estate to be used for prizes in advance of commercial space. The only obligation the winner of a prize should have is to win it: prize money does n0t purchase the rights to the invention.

Now it is probably true that anyone who wins this McCain battery prize will make a great deal more money for that technology in the market place. Probably true: but the market is uncertain, and raising capital always has to compete with other places to invest. One of the problems we have always had with commercial space is that there are both technical and market risks, and those who understand the one kind of risk generally don't comprehend the other; so they invest elsewhere.

Prizes reduce market uncertainties by providing a floor. If the US were to offer a $1 billion prize for the first American company to fly a ship to orbit and bring it home 6 times in one year, we would probably have reusable space ships within five years, possibly sooner: a billion is a pretty good market incentive. And if the US were to offer $10 billion prize for the first American company to put 31 Americans on the surface of the Moon and keep them there alive and well for 3 years and a day, we would have a Lunar Colony within 7 years and probably sooner.

The neat thing about prizes is that we spend no money unless someone wins. Now surely it would be worth far more than $300 million to have any capitalist have the battery technology McCain describes. Indeed it would be worth far more, and the only real criticism of the McCain prize might be that it wasn't large enough. On the other hand, how does it harm us to have the $300 million offered? This is a very good move on McCain's part, and makes me a lot happier to support him than I was. It makes him something more than the lesser evil...

Which seems to cover all the bases

While Obama said

"When John F. Kennedy decided that we were going to put a man on the moon, he didn't put a bounty out for some rocket scientist to win -- he put the full resources of the United States government behind the project and called on the ingenuity and innovation of the American people -- not just in the private sector but also in the public sector," he said at an event in Las Vegas.

Which shows he just doesn't get it. That is precisely what went wrong with America's space programme. When they got back they were left with no mission & a massive bureaucracy called NASA which has absorbed money ever since.

Now if only he would turn 1/4 of NASA's $16 billion annual budget into funding an X-Prize Foundation for space development. The very worst that could happen is that nobody would win any prizes which would leave a lot of money lying around but there is no way some wouldn't be won. Obama is already on record as saying he would take part of NASA's budget for early education so McCain would certainly have a free run if he decided to do this.

Note also that it is proper to maximise the use you get out of such prize money. Assuming that the first prize would take 4 years (Jerry assumes 5) an initial grant of $4 billion & 4 more annual ones, assuming 10% growth a year which is only slightly above inflation plus economic growth, amounts to $24.4 billion but assuming 6% interest on the money held would increase it to $27.2 billion. If Burt Rutan could get into space on a $10 million prize I think $27 billion would move the world.

What is needed is another Bjo Trimble get people writing to him, indeed to both candidates, to say so.

UPDATE
Jerry has posted in full the except of the above I sent him & replied:

Actually, Congressman Rohrabacher was interested in setting up a US Prizes Foundation to hold prize money. This was when we had lunch perhaps 3 years ago before the forseeable election disaster. And Mrs. Trimble was the recoding secretary of the Citizens Advisory Council on National Space Policy back in 1980. We did a bit of campaigning then but SDI took over. The Cold Was was still on...

Further on he gives an expansion of the Obama quote I reproduced. The sentence before what I quoted goes "But I don't think a $300 million prize is enough." which considerably ameliorates his apparent objection to X-Prizes & makes at least a large part of the objection merely to it being to low a figure with which I have can agree.

BT (British Telecom) Global Services is joining with the X-Prize foundation to produce up to 12 unnamed X-Prizes, for which BT is putting up $7 million

...the foundation's three-year, $7 million philanthropic deal with Britain's BT telecommunications giant may not rank as high. But the way X Prize founder Peter Diamandis sees it, this is just the beginning of a beautiful friendship.

"The X Prize is going global," Diamandis, the foundation's chairman, told me today.

He explained that until now, the California-based foundation's activities have been mostly U.S.-centric. "We have partnered with BT to take the X Prize to Europe and Asia, and South America, and we have an incredible partnership," he said.

Over the next three years, BT (a.k.a. British Telecom) will be providing $7 million in operating funds to the foundation, and also sharing its scientific and technological expertise as new X Prizes are rolled out.

Diamandis has said that the foundation wants to create two or three new prizes each year, focusing on five areas: exploration, life sciences, energy and the environment, education and global development. Today, Diamandis told me one or two prizes are in the works for unveiling by the end of the year.

The likeliest next X Prize will have to do with cancer research. Diamandis acknowledged that such a prize "is on the horizon," but didn't provide specifics.

It appears BT is putting up money purely to publicise it internationally which seems a good idea - such prizes are to the benefit of the whole world & the more people who here about them, either as possible contestants or donors, the better. Sounds like a very good investment for BT in terms of global prestige & advertising to. I guess the Foundation have, or are on the cusp of having, a bunch of rich donors to put up the £300 million.

If only another British political leader, as well as Alex Salmond, would have the gumption to get their party to stand for funding a British X-Prize Foundation as I have previously suggested.
We have had X-Prizes coming from several different sources now, not all under that name & it really feels like acceptance of the idea is building to a critical mass. Not like it used to be.

This is the prize Scotland's government put up using the X-Prize format

£10 million will be awarded to the team that can demonstrate in Scottish waters a commercially viable wave or tidal energy technology that achieves a minimum electrical output of 100GWh over a continuous 2 year period using only the power of the sea and is judged to be the best overall technology after consideration of cost, environmental sustainability and safety.

That certainly looks like a definition of an X-Prize, even though there is a not unreasonable matter of judging.

Now I believe & have said before, that a subsea turbine is not the most important thing we should be encouraging. That would be an orbital shuttle or the improved battery that John McCain proposed or several of the things Newt Gingrich suggested. On the other hand it is a substantial step towards funding things this way, rather than through government grants which amount to a blank cheque with no failure conditions.

Alex Salmond at least gets the theory though he is also politician enough to lay it on with a trowel:

Mr Salmond announced the details at a reception in Edinburgh Castle for
scientists, environmentalists and potential entrants.’The Scottish Government’s
10 million Saltire Prize is one of the biggest international prizes in history,’ said Mr Salmond. ’It is Scotland’s energy challenge to the world, a challenge to the
brightest and best minds worldwide to unleash their talents and push the frontiers
of innovation in green marine energy.’

However I am a little cautious over this bit "Entries for the Saltire Prize open next summer, and the closing date will be in June 2013, with the winner chosen two years later."

Firstly I am by no means sure that a truly "commercial" sea turbine is possible - this should not be a problem because if it isn't then we should not expect the prize to be won. However the date for a winner to be chosen suggests that somebody may be chosen come what may rather than handing it over to the first person to crank out 100Gwh for 2 years. That would rather negate the point.

Tavish Scott of the LibDems did go out of his way to make it clear that he didn't understand the difference between a prize & complained that it wasn't a real prize because it hadn't yet been handed over to everybody who turns up at the starting line. By comparison the SNP certainly rate at least 7 out of 10 & will be higher if they don't fumble the actual award. Though I have said some of this before I am pleased to see the actual wording of the prize & it is more reassuring. After all no government elsewhere, as far as I know, has endorsed any sort of X-Prize.

The Saltire site does have an embarrassing list of the endorsements they find politically useful - all from various sorts of eco-nut - but I suppose that is politics, better to have such people inside the tent pissing out than vice versa.

Labels: Scottish politics, X-Prizes

I saw this in McKinsey Quarterly (registration needed but its free):

by Jonathan Bays, Tony Goland, and Joe Newsum

The use of prizes by philanthropies and private businesses to encourage innovation and achieve social benefits is burgeoning. A McKinsey study of prizes worth more than $100,000 suggests that the aggregate value of such large awards has more than tripled over the past decade, to $375 million. Moreover, the role of prizes is changing: nearly 80 percent of those announced since 1991 have been designed to provide incentives for specific innovations rather than to reward excellence in general. An understanding of the characteristics of effective prizes and of how they are evolving would be useful for not only philanthropists but also public- and private-sector players hoping to harness their potential for innovation.

To learn how prizes are meeting the goals of the philanthropies that finance them, and how their effectiveness might be improved, we studied 219 prizes, each with a value of $100,000 or more; interviewed about 100 experts on innovation, prizes, and philanthropy; and surveyed the sponsors of 48 major awards. Further, we conducted in-depth interviews with the sponsors and administrators of 12 public, private, and philanthropic prizes that have particularly interesting strategies, designs, and management practices.

...the expansion of prizes in areas such as science, engineering, aviation, space, and the environment. By contrast, prizes related to the arts and humanities represented one-third of the total a decade ago but make up less than 10 percent today.

When are prizes more effective than other kinds of philanthropic instruments? Our research suggests that three conditions are paramount: a clear objective (for example, one that is measurable and achievable within a reasonable time frame), the availability of a relatively large population of potential problem solvers, and a willingness on the part of participants to bear some of the costs and risks. Teams competing for the $10 million Ansari X PRIZE to develop spacecraft capable of entering space and returning safely twice within ten days, for instance, spent more than $100 million in the pursuit.

If one or more of these conditions can’t be met, potential prize givers should consider alternatives such as grants or a combination of prizes and other instruments. Indeed, some prize sponsors have adopted a portfolio approach to social change. The Mo Ibrahim Foundation, for instance, offers a $5 million prize for a retired head of state who provided effective leadership in Africa and publishes a quantitative index of African governance. The index builds on the publicity generated by the prize to start a wider debate about the importance of good governance, a debate intended to prompt important changes in public attitudes as much as individual behavior.

... Since SpaceShipOne took the Ansari X PRIZE in 2004, public and private investors have spent more than $1.5 billion to develop this nascent industry.

...Our research also revealed a critical (and often neglected) area in the development of prizes, measuring their impact and making appropriate changes in response. An organization sponsoring a prize aiming to strengthen a particular community, for example, could periodically examine collaborative projects resulting from the new networks created. But in our survey of prize administrators, only 23 percent of them annually evaluated the impact of their prizes. Sponsors should regularly appraise prizes by measuring their impact and revise them when they fall short of meeting the broader goal, whether it’s generating investments for a winning proposal or sustaining a newly created community of participants.

Ultimately, the ability of prizes to mobilize participants and capital, spread the burden of risk, and set a problem-solving agenda makes them a powerful instrument of change. They offer a valuable form of leverage to sponsors that use them as part of a well-designed strategy.

The accompanying graph shows that from 1997 to 2007 prizes have increased:

Total in million $s ------- 74 --- 315 (x 4.3)
Space/Aviation ------ 12 ---- 88 (x 7.3)
Science/Engineering 18 ---- 88 (x 4.9)
Environment ------------ 6 ---- 77 (x12.8)
Arts ----------------------- 27 ---- 30 (x 1.1)
Other --------------------- 12 ---- 33 (x 2.8)

At that rate by 2017 we will have combined space prizes of $640 which is definitely in the ballpark of Jerry Pournelle's statement that 2 prizes for an orbital shuttle, $500,000 for 1st, $250,000 for 2nd, would do it.

This article, combined with the fact that government, which could fund all this out of petty cash, does nothing useful in this field makes me rethink a bit on the whole idea of funding X-Prizes & government's competence at promoting progress. I will proceed on that tomorrow. The most useful government X-Prize I have seen is the £0m Scottish Saltire Prize which, being for a commercial sea turbine is an interesting mixture of innovative thought in pursuit of a useless political goal.

Labels: space, X-Prizes

I have previously blogged, extensively, about how X-Prizes for particular technological achievements, particularly those related to space, could promote progress.

Here is something similar in a field which, though I have blogged about it before, gets less coverage & is more important to most individual people than space - preventing aging.The Methuselah Mouse prize is a very good example of how to use such prices since actual profits to be made in extending the lives of mice are minimal but the possible crossover to humans when it has been achieved is unlimited. They also, having made awards, have a proven record of success.

The Mprize competition is an exciting and viable mid-term strategy to deliver on the Methuselah Foundation’s mission of extending healthy human life. It directly accelerates the development of revolutionary new life extension therapies by awarding two cash prizes: one to the research team that breaks the world record for the oldest-ever mouse; and one to the team that develops the most successful late-onset rejuvenation. Previous winners have already proven that healthy life can be extended; each new winner pushes the outer limits of healthy life back even further.

When asked how the Mprize will produce solutions to the diseases of aging, Methuselah Foundation CEO Dave Gobel says: "Human beings that work committedly to a common and beneficial goal are one of the most powerful forces in the known universe - I mean that. Given time, there is nothing that we can conceive of that we can't eventually achieve." This competitive research structure gathers together the widest array of resources and the broadest spectrum of biological techniques available, and the results provide ever more powerful evidence that we can greatly extend healthy lifespan.

The Mprize consists of two separate prize competitions:

The Longevity Prize, awarded to the research team that breaks the world record for the oldest-ever mouse (Mus musculus);
The Rejuvenation Prize, awarded for the best-ever late-onset intervention.
In the competition for the Longevity Prize, money is awarded to the producer of the world’s oldest-ever mouse. This is restricted to the species used in virtually all laboratory work, Mus musculus, but no other restrictions should be placed on the way in which the mouse's lifespan is extended, provided that the methods used maintain cognitive and physical wellbeing.

The Rejuvenation Prize rewards successful late-onset interventions performed on an aged mouse and has been instituted to satisfy two shortcomings of the Longevity Prize: first, it is of limited scientific value to focus on a single mouse (a statistical outlier); and second, it is very likely that interventions applied throughout life (as they are during Longevity Prize research) will always be ahead of those initiated late, and thus would have an ongoing advantage in a simple competition structure. Our most important end goal is not merely to extend life, but to promote the development of interventions that restore youthful physiology. By seeking interventions that are effective when initiated at a late age, this prize encourages scientific research that is most likely to benefit those reading these guidelines today.

Details

A fund exists to provide the money for the Longevity and Rejuvenation prizes. This fund is open to contributions from anyone; donors can contribute to either or both prizes as they see fit. In addition, donors of amounts exceeding US$25,000 can choose to make their donation up front or as a pledge.

Longevity Prize

The Longevity Prize is won whenever the world record lifespan for a mouse of the species most commonly used in scientific work, Mus musculus, is exceeded.

The amount won by a winner of the Longevity Prize is in proportion to the size of the fund at that time, but also in proportion to the margin by which the previous record is broken. The precise formula is:

Previous record: X days
New record: X+Y days
Longevity Prize fund contains: $Z at noon GMT on day of death of record-breaker
Winner receives: $Z x (Y/(X+Y))

Thus, hypothetically, if the new record is twice the previous one, the winner receives half the fund. If the new record is 10% more than the old one, the winner receives 1/11 of the fund, and so on. The fund can thus never be exhausted, and the incentive to break the new record remains intact indefinitely. This is very different from a structure that specifies a particular mouse age at which the whole fund is awarded. We believe this to be a very important difference: public attention will be best engaged and maintained by a steady stream of record-breaking events that demonstrate how scientists are taking progressively better control of the aging process.

The developers of a record-breaking intervention will receive prize money every week from the point at which their oldest living mouse beat the previous record. The amount paid each week will be calculated as though their mouse had just died, and the total amount won so far by a living record-breaker will be prominently displayed on the Mprize web site.

Rejuvenation Prize

The Rejuvenation Prize is not awarded for the life extension of an individual mouse but for a published, peer-reviewed study. The study must satisfy the following criteria:
The treated and control groups must have consisted of at least 20 mice each.
The intervention must have commenced at an age at least half of the eventual mean age at death of the longest-lived 10% of the control group.
The treated mice must have been assessed for at least five different markers that change significantly with age in the controls, and there must be a statistically significant reversal in the trajectory of those five markers in the treated mice at some time after treatment began versus some time before it began. The experimenters select the comparison times, both before and after. It is acceptable for other markers to fail to show this reversal.
The record that the next winner must beat is the mean age at death of the longest-lived 10% of the treated group.

It is also worth pointing out that, once again, all the money has been put up by rich individuals. Government routinely spends billions on research which is wasted yet will not put up even millions for this. There is no reasonable doubt that for a small fraction of what what government currently spends on science they could get almost everything they are allegedly researching for. Indeed there is no doubt whatsoever that they would either get it or it would cost nothing since that is the nature of prizes. It strongly supports Pournelle's law that "the purpose of government spending is to pay government workers & their friends" & that any secondary purpose (what the money is officially supposed to be for) is a very insignificant consideration indeed.

It strikes me that if, as suggested, low gravity reduces aging then a future M-Prize winner might be connected to a previous X-Prize winner - now that is how science works.

Labels: Science/technology, X-Prizes

I just wrote on the growth of private enterprise space prizes (7.3 fold increase in 10 years = 22% annually). I also wrote on the fact that the world space industry (ok that is a contradiction in terms) amounts to $257 billion annually. The 3rd leg of this stool is how fast is it growing.

aggregate space sales of the companies surveyed increased 44% (10-15% annually) for the 2003-2006 period. Domestic non-defense sales grew 63%, primarily in the space services and ground equipment segments. Domestic defense sales grew by 29% - pdf p23

That 63% of non-defence sales amounts to an increase of 17.6% annually.

In Britain our space industry is growing at what the government clearly feel a very healthy rate:

The entire UK space sector currently contributes £6.5 billion to the UK economy, supporting around 68,000 direct and indirect jobs. The recession busting trends of the space industry has enabled it to successfully ride the downturn, and it is also predicted to grow by an average of 5% per year until 2020.

5% a year would mean our space industry would be worth £11.1 bn by 2020 whereas if we could just match the US rate it would be £38.7 bn, such is the spectacular effect of compound growth. If we could improve on the US rate by 10%, which should be fully achievable if we put in a proportionately substantially greater effort than the relatively little the US is doing, we would manage £95 billion ($156 bn) by then. This is more than half the entire current commercial space effort worldwide.

So what is required? We need space X-Prizes. The official primary remit of The British National Space Centre is to "win an increasing share of the global market in space systems, services and applications in the race to develop tomorrow's economy". This is an entirely market orientated requirement which would clearly be served by X-Prizes or other encouragement of commercial ventures & is negated by the fact that they actually just send their £275m annually to Europe where ESA will achieve virtually nothing with it. I have previously called for that money to be put into a British X-Prize Foundation & in light of yesterday's article about US private enterprise X-Prizes have devised this which involves a minimal amount of new government cash & a massive increase in investment.
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SPACE X-PRIZE FOUNDATION ACT

1 - Set up a British X-Prize Foundation, run by independent Commissioners appointed for expertise in science, engineering & venture capital not politics or civil service, to award prizes for space & in due course other technology achievement prizes. Also a Register of independent technology prizes, carrying out the functions of the Charity Commission for such prize funds, including ensuring the prize money is there.

2 - Government undertakes to provide the foundation with the £275 million currently given to ESA & to increase that proportionately to either twice the current rate of space industry growth or 10% more whichever is the lower.

3 - Government to allow tax rebates of 3 times the basic tax rate as Giftaid for donations to the Foundation or other science & technology prizes. This rate to be raised or lowered by not more than 5% annually to keep receipts paralleling those promised under section 2. Rebates to be by the Foundation & register issuing vouchers to be immediately honoured by in the simplest possible way to ensure every income tax payer can benefit.

4 - All Corporation Tax paid by space related sections sections of companies & 50% of income tax by employees in such sections tom be zero rated for a period of 25 years.

5 - The Foundation, with the full cooperation of the civil service to draft, at least annually, legislation to repeal or alter existing regulations which are economically damaging to space industry. Such legislation to be presented to Parliament unless the government finds them unreasonable & all reasons for finding them so, to be published.

6 - The foundation be allowed to announce prizes based on cash in hand & cash expected over the subsequent 5 years initially & 6 years after 1 years working. In the event of a shortfall, either due to several prizes being won very quickly or a downturn in the expected rate of growth, government shall guarantee loans on outstanding liabilities but no further prizes to be announced until the fund is back in surplus.

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I think that would do it.

The only immediate net cost to government is 2 of the 3 times normal income tax rates (the 1st is already refunded for all charitable donations. With income tax at 20% that is [£275m x 20% x 2 / 130%(from every £1.30 of taxes collectible only about £1 is not avoided or spent in the collection)] £85 m million. The £275m of direct payment under section 1 comes from money previously given to ESA. The reduced taxes under 4 would, under the Laffer curve, be expected to be at least matched by increased economic activity both in these companies & spin off activity. Note that because space is the same distance from all countries & involves no significant use of local natural resources it can move fairly easily to any country with an advanced education & technological infrastructure. That makes it particularly easy to attract via tax breaks.

The prize money investment would be [£275 x 2] £550 million in the first year. Assuming, conservatively that space industry growth continues at 5%, meaning the fund increases at 10% that would be £605m in the 1st year, & £665m, £732m, £805m &£886m subsequently totalling £4 billion ($6.6 bn). This would immediately fund Jerry Pournelle's proposal for a commercial orbital shuttle & for a commercial space station. If the rate of growth in space industry increased, as it could hardly fail to do, the fund allocation would increase which, together with each new year's allocation would see a fast, self financing, exponential growth in technology investment. For example if growth went up to the US level of 17.6% the allocation in the next 2 years would be £1.34 bn &£1.47 bn plus revaluation of the intervening years. Since this could only happen if there was a fast growth of the space economy following the introduction of this programme payments in subsequent years would be likely to be less than the increases to the Exchequer from economic progress.

What would be the total extra economic investment in the British economy from this programme? Well according to the article discussed yesterday "Since SpaceShipOne took the Ansari X PRIZE in 2004, public and private investors have spent more than $1.5 billion to develop this nascent industry" for a space X-Prize investment of $88 million. That is a ratio of 17:1. There may be other reasons for that much investment but it was done without the subsequent tax reduction in section 5 so it is not unreasonable to stand by that (indeed it would not be unreasonable to go beyond it but I won't). At that ratio we get British commercial investment of £68 billion, which is not a bad return for government spending of £85 million. While this could be opposed by Luddites opposed to any form of economic growth I don't think it could be sensibly opposed by anybody else, unless they could dispute the figures here by more than a hundredfold.
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Other countries - the figures here are scalable. Scotland at 8% of UK GNP could, for a similar level of effort, do this by putting up £22 million as equivalent to the ESA contribution & running the charitable refund through the rates system. 8& of $6.6 bn is $528 million which would just finance a commercial shuttle according to Pournelle's most recent figures. This also applies to any developed country & a lot of US states with GNP down to $213 billion annually which includes Hong Kong, Czech Republic (both 40) & Ireland (34). Singapore would have to make marginally more effort but, noting both their technophilia & equatorial location, can see them doing so.

Japan, Germany, China, France, Italy & probably Russia could match the full programme. The USA could do so with ease. Whether they have the gumption to do so is questionable but certainly somebody is going to. The future & untold wealth is out there for any country progressive enough to reach for it.

Labels: constitutional amendments, Fixing the economy, space, X-Prizes

We don't yet know the full details of this prize - will it be for a particular achievement assessed in advance - however this has clearly been thought of as an X-Prize & is being sold in that way.

A £10m prize for innovation in renewable marine energy is to be announced by the first minister during his trip to the US....

The government hopes its offer of £10m will inspire scientists from across the world to work out new ways of cashing in on marine renewables.

It will be the world's biggest prize in marine renewables and it will be treated extraordinarily seriously

It has been billed as the world's largest single prize for marine power technology.

To be eligible for the prize, innovations must be commercially viable and be demonstrated in Scotland.....

"The history of such innovation prizes shows that they repay their investment many, many times over."

I am unconvinced about the wonders of renewables & very much doubt if anything can be produced which is truly "commercially viable" when compared to nuclear, but for that reason the comparison may not be made. However if it can be done this is the way to do it. Good marks to the SNP for doing this even if they are doing it on the wrong subject. Still if this is seen to be popular it makes it all the more likely that Scotland, or indeed some other state could issue the sort of £20 million X-Prize motion I suggested to the LudDims some years ago for landing a probe on an asteroid, or something similar.

Lets see if New Mexico (or even old Mexico) or Singapore, or I would love to think Scotland or the UK, might like to put up a more useful X-Prize.

A few days ago I blogged about the Saltire Prize being, so far as I knew, the only government sponsored X-Prize in the world. Well it turns out that the US Army put up $3 million of prizes & it worked:

"August 18, 2009: The U.S. Army's decades long effort to develop a practical autonomous UGV (Unmanned Ground Vehicle) has succeeded. Earlier this month, two T2 vehicles equipped with sensors and control equipment, successfully passed realistic tests...

Two years ago, for the third time since 2004, the U.S. Department of Defense sponsored a race for robotic vehicles. For several decades, the U.S. Department of Defense has been trying to build a robotic vehicle. But in early 2004, the Department of Defense decided to try something different, and give enterprising civilian organizations a chance to show what they could do. DARPA (Defense Advanced Research Projects Agency) held the DARPA Grand Challenge. Put simply, the first robotic vehicle (moving completely under software control, with no human intervention) that could complete a 240 kilometer course, would get a million dollars for its designers. No one even came close. But a second Challenge, held in late 2005, yielded several finishers, and the first one picked up the million dollar prize for navigating a 212 kilometers cross country course in just under seven hours. All vehicles operated under software control, as true robots. The third "Challenge" race was held in late 2007, and had a two million dollar prize for the first vehicle to complete a 60 kilometer course through an urban environment (an abandoned air force base) in under six hours...

The DARPA Challenge races have been a bonanza in terms of advancing the state of the art for robotic vehicles. For less than $10 million in prize money and expenses, the Department of Defense has created new technology that would have otherwise cost more than $100 million, and taken a lot longer to perfect."
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I hope it was a lot less than $10 million in prizes & admin expenses since it was 3 million in prizes. The non-military spin off of having such driverless vehicles seems to me to likely to proportionately match the non-billiard ball spin off when a billiard ball company put up such a prize for a substitute for elephant ivory to make balls & wound up with celluloid, the first plastic.

However the principle that X-Prizes work, in this instance admitted to be something like 30 times better than conventional government funding, is even more valuable than that. I have still yet to hear anybody explaining why not - particularly when you remember that if nobody wins the prize, as happened the first year her, no payment is made.

I got this story via Jerry Pournelle eh says "I have never understood why prizes are not popular. They cost almost nothing -- perhaps a million a year total to fund a commission that determines if a prize should be awarded -- and you know the total to be paid. A ten billion prize for a Lunar Colony Prize (keep 31 Americans alive and well on the Moon for 3 years and one day) would either get us a Moon Base or it would cost nothing. A reusable space ship prize of 5 billion (send the same ship to orbit 13 times in one year) would again get us a space ship or would cost nothing. We spent more than half that on the X-33 fiasco." Perhaps it is the ultimate proof of Pournelle's Law - that the prime purpose of government spending is to pay government workers & their friends & X-Prizes are devoted almost entirely to the nominal but secondary purpose of achieving results.

Labels: Government parasitism, X-Prizes