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LAST JULY, the Science and Engineering Research Council (SERC) set off
alarm bells among British scientists working on optoelectronics – the convergence
of optical and electronic techniques in gathering, processing, storing and
displaying information. The subject had been identified as a top priority
only one year earlier by the government’s own scientific advisers. But suddenly
optoelectronics faced a shortfall in SERC funding so large that at least
half of the six leading research groups in the country were threatened with
closure (This Week, 8 July).

Since then, the SERC has hastily reshuffled its budgets and taken up
slack from other areas of research to find sufficient cash to haul optoelectronics
research back from the brink. Despite this reprieve, the researchers remain
disgruntled. They are unconvinced of the government’s strength of commitment
to this new technology.

This month, the government, through the Department of Trade and Industry,
finally responded to the original report on optoelectronics* from its advisers
ACOST (the Advisory Committee on Science and Technology). The response makes
it clear that the government agrees it is vital for the optoelectronics
industry in Britain to get off the ground. It also makes it clear that the
government feels the electronics industry must do this largely on its own,
creating and developing an international market for the products it spawns
with only minimal help from public coffers.

Optoelectronics is already making its presence felt in our everyday
lives, and will have an impact on virtually all areas of electronics over
the next decade. New devices for receivers and transmitters have made possible
telephone conversations travelling at the speed of light via fibre optic
cables. Laser technology has led to new consumer goods such as the compact
disc player, and is now in widespread use in general surgery. The next step
will produce high-definition 3-D televisions and computers whose components
communicate by light instead of electrical pulses.

ACOST has been extremely positive about the strength of R&D in optoelectronics
in Britain. Its report stresses that it is vital for Britain that the government
takes the utmost care in nurturing this important new field of technology.

Its most urgent plea is for a national fibre optic network for communications.
This would provide the greatest possible stimulus to the market for optoelectronic
systems and products in Britain.

The network would link commercial and domestic premises so that people
could use video telephones, transmit data and transfer funds electronically.
It would also stimulate an entirely new world of electronic publishing and
vastly increase people’s access to databases.

The government, British Telecom, the cable television operators and
the electronics industry are currently locked in debate over this. If British
Telecom and Mercury were to get involved in such a project,the government
would have to alter the terms of their licences to allow them to carry entertainments
services. The government argues that this could ‘inhibit the growth of competition
in telecommunications networks’. It also argues that there are still a number
of technical hurdles.

In its response to ACOST, the government says it will not review the
terms of licences for British Telecom and Mercury before November 1990.

For the time being, ministers will do no more than support trial schemes,
such as a project by British Telecom at Bishop’s Stortford, in Hertfordshire,
which was given the go-ahead only last week. Over the next two years, 500
homes and businesses in the town will test a fibre optic link carrying telephone
speech, low-speed data, and eventually television, hi-fi radio and video
services.

British Telecom wants its licence extended so that it can carry such
services nationwide. It argues that this is critical if Britain still hopes
to compete internationally in optoelectronics.

Nigel Horne, director of technical and corporate development at STC,
agrees that government must sort out its dilemma over deregulation of telecommunications,
and do it quickly. ‘I would like to have seen this problem removed a year
ago. Britain has been at the forefront with optoelectronics – now we are
allowing people to catch up . . . not because we are incompetent, and not
because we are not putting enough money into the subject.

‘We have the technology sitting there waiting and nothing to apply it
to. The government has totally missed the point. What we want is not more
government money, but this market distinction removed . . . then we can
create a market to give us the opportunity of making money. If the government
would only get on and remove this damn fool regulation, that would be a
big boost to the industry.’

Universities also fear that the government’s lukewarm attitude to a
national fibre optic network is a lost opportunity. John Midwinter, professor
of optoelectronics at University College, London, says the long-running
dispute between British Telecom and the government has already resulted
in Britain slipping behind the competition.

‘What looked to be a good position in the UK three to four years ago
seems to be evaporating at a terrifying rate,’ he says. He blames this on
the lack of any major programme for a national communications network aimed
at implementing the research in which Britain excels.

The government’s response is to reassert its wish to support the academic
effort in optoelectronics, through the work of the SERC. Last July, Alec
Gambling, professor of optoelectronics at Southampton University, questioned
this support when he raised the alarm on the bleak future for optoelectronics
research in Britain.

The SERC allocates much of its research money for optoelectronics in
the form of four-year rolling grants, designed to provide a degree of stability
for research in the subject. Gambling says that nobody had the foresight
to see that a number of these rolling grants would come up for consideration
in this year’s round of funding.

The SERC has now made available sufficient money to ensure that all
of Britain’s leading centres of research can continue their work. But Gambling
points out that the situation is far from cured: the rolling grants will
still come up for renewal in the same funding year, in four years’ time.

He says that despite the extra cash from the SERC, the fate of research
in this field remains uncertain. He has to wait for a meeting scheduled
for next month to learn how much money the SERC has put aside to fund this
year’s applications for standard two- to three-year grants.

Gambling chairs the committee charged with distributing SERC funding
for optoelectronics. He says that his committee first knew of the shortfall
in funds when it was told it had just Pounds sterling 700,000 to fund optoelectronics
for the coming year, insufficient for even half of the committee’s outstanding
proposals for grants. At least one, and possibly as many as three of the
six leading groups in the country might have had to close as a result, Gambling
said. This threatened work at Glasgow University, Heriot-Watt University,
University College, London, and the universities of Oxford, Cambridge and
Southampton.

Gambling says that the problem was caused by confusion at the SERC,
prompted by a major exercise to restructure the administration of research
in information technology in Britain. This involved setting up the Information
Engineering Advanced Technology Programme as the successor to the Alvey
programme.

Gambling claims that when the new administration took over, the SERC
secretariat tried to establish how much money had been going to optoelectronics,
and got it wrong: ‘They reached inadequate conclusions from the documents
they saw.’

The SERC refutes the suggestion that there was ever any confusion in
its ranks. ‘It was really a cashflow problem,’ says Richard Lindgren, secretary
of the council’s devices committee. ‘We have succeeded in redistributing
money within the council as a whole between areas, to enable some relaxation
of the pressure on this one area.’ Lindgren says the SERC was aware that
the rolling grants would all come up for consideration in the same year,
but did not know how much money would be available to finance them.

ACOST called for a handful of specific changes to the way in which research
in optoelectronics is organised in Britain. First, it asked government to
extend and enhance Britain’s first pre-competitive research scheme, the
Joint Optoelectronics Research Scheme (JOERS), and to provide extra money
to support the programme.

JOERS is widely accepted to have been a success in stimulating joint
R&D between industry and academia. The government, however, says in
its response that research established by JOERS ‘has reached a stage where
much of the further development towards commercial exploitation should be
undertaken by the companies involved’.

It says that further public funding for optoelectronics will happen
through the LINK programme in optoelectronics, set up in April. The LINK
programme has a budget of Pounds sterling 30 million, half of which comes
from industry, and half from public funds – Pounds sterling 10 million from
the Department of Trade and Industry, and Pounds sterling 5 million from
the SERC. Desmond Smith, from Heriot-Watt University, feels that LINK’s
financial rules prevent it from satisfactorily replacing JOERS.

Under JOERS the Department of Trade and Industry would pay half of the
costs incurred by industrial partners in a joint research project, and the
SERC would pay all of the costs incurred by the university partners. Under
LINK, the total public subsidy, from both the department and the SERC, cannot
exceed 50 per cent of the cost of any project. This means that the industrial
partners could end up with much less than half of their costs paid for by
government, depending on how much the SERC pays the universities.

The academics argue that industrialists will take part only in those
projects where university participation is minimal. They claim that this
weakens the role of the universities in deciding the direction of joint
research projects. ‘The LINK arrangements marginalise the universities,’
says Chris Wilkinson, professor of electrical engineering at Glasgow University.
‘Under JOERS, the contribution to the direction of research from industry
and from the universities was roughly equal.’

Horne agrees that the LINK rules are less advantageous to both academics
and industry than the set-up under JOERS. ‘The effect is to discourage full
collaboration between academia and industry. People go through gymnastics
to try to collaborate with universities, but still end up with little university
involvement under LINK.’

But Horne disagrees with the academics’ view that they should have more
of a say in determining the direction of joint research. ‘The whole reason
for having collaboration is to bring some market pull to bear on the research.’

Smith acknowledges encouraging moves from the SERC, which has recently
set up two interdisciplinary research centres in the field of optoelectronics.
He also notes the increasing success by British teams in securing money
through collaborative research in Europe. But he feels that as a whole optoelectronics
research is still severely underfunded in Britain. The ACOST report reached
a similar conclusion on British investment in the subject.

At University College, Midwinter paints a gloomy picture for optoelectronics
in Britain: ‘The ACOST report said we must build on our investment. It is
not obvious that in the intervening year we have done much building. The
SERC has tried hard to solve the problem, but our total capability in this
area is probably less than it was when the report came out.’

*Optoelectronics – Building On Our Investment, HMSO, July 1988, Pounds
sterling 12.95