[Random-bits] PROMINENT INNOVATION PRIZES AND REWARD PROGRAMS

James Packard Love james.love@keionline.org
Mon Mar 12 07:13:00 2007


http://www.keionline.org/index.php?option=3Dcom_content&task=3Dview&id=3D2=
9

PROMINENT INNOVATION PRIZES AND REWARD PROGRAMS
KEI Research Note 1
Benjamin Krohmal

March 1, 2007
Introduction

The following document describes prominent examples of innovation
prizes and reward programs that have been implemented with the
primary purpose of stimulating innovation.  While the distinction is
not black and white, this list includes ex ante prizes that specify
in advance a desired outcome and a reward for obtaining it in order
to incentivize innovation, and excludes ex post prizes that are, for
example, primarily intended to honor achievement after the fact.
Prizes are listed chronologically from earliest to latest as
determined by the year in which the prize was initially offered.

1714 - Longitude Prize

In 1714, the British government offered the Longitude Prize for a
method of accurately determining a ship=92s longitude.  Prizes of 10,
15, and 20 thousand British pounds were offered for solutions of
varying degrees of accuracy.  John Harrison was awarded the top prize
in 1773, and his system revolutionized navigation and maritime
trade.  Commentators have noted that methods for verifying a winner
of the Longitude Prize were poorly specified, resulting in arguably
unreasonable demands of proof that postponed Harrison=92s eventual
payment by years.  On the other hand, by leaving open eligible
methods for solving the problem, the prize succeeded in promoting a
surprising solution.  Harrison=92s method utilized a chronometer, when
most expected the winning method to involve improved star charts.

1721 - French Royal Academy Prize Questions

In 1721, the French Royal Academy of Sciences began offering regular
scientific and mathematical =93prize questions=94 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

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.

1795 - Napoleon's Food Preservation Prize

In 1795, Napoleon=92s Society for the Encouragement of Industry offered
a 12,000 franc prize for a method of food preservation to help feed
Napoleon=92s 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. The Montyon prizes were designated for
solutions to pre-specified medical challenges, with reward amounts
intended to be =93proportional to the service=94 of the innovator.  The
Academy struggled with applicants=92 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=92s 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=92s, 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 =93to accelerate the progress of organic
chemistry=94 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 awarded 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,=94 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=92s success, the Brazilian government
matched the prize money he received.

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 fist
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.

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

In 1909 the British Newspaper the Daily Mail offered the English
Channel Crossing Prize of 1,000 pounds to the first pilot to fly an
airplane 21 miles across the English Channel.   Louis Bleriot won the
prize the same year, and the French government supplemented his
winnings with an additional 50,000 francs.

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

In 1913 the Daily Mail offered the Trans-Atlantic Prize of 10,000
pounds to the first pilot to fly across the Atlantic within 72
hours.  John Alcock and Arthur Whitten Brown won the prize after
World War I in 1919.

1919 - Orteig Prize

In 1919, Raymond Orteig offered the $25,000 Orteig Prize for the
first non-stop flight between New York and Paris.  The prize offer
expired in 1924 with no attempts before Orteig extended the
deadline.  By the time Charles Lindbergh won the prize in 1927 in his
famous plane, the =93Spirit of St. Louis,=94 nine competitors had
prepared to make the flight and three had already tried and failed.
Lindberg=92s success sparked a boom in American interest in aviation,
and inspired many subsequent prizes, including the Ansari X Prize 70
years later.

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

At his death in 1948, Paul Wolfskehl left 100,000 German marks as a
prize for the first valid proof of Fermat=92s Last Theorem.  While
there had been previous attempts to prove the 300 year-old theorem,
the Wolfskehl Prize increased the problem=92s profile.  Andrew Wiles
won the prize in 1997.

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

In 1959, physicist Richard Feynman offered prizes of $1,000 for the
development of the first motor less than 1/64th of an inch on every
side, and for the first written text at 1/25,000th scale.  William
McLellan and Thomas Newman won the prizes in 1960 and 1985,
respectively.

1959 - Kremer Prizes

Also in 1959, Henry Kremer offered a prize of 5,000 pounds for the
development of a human powered flying machine.  Paul McCready won the
prize in 1977, after which Kremer offered several additional prizes
for further advances in human-powered flight.

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=92s Deep Blue Chess team won the prize in 1996 when
their machine defeated Gary Kasparov.

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
=93Turing Test=94 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

In 1992, 24 American utility companies created the Super Efficient
Refrigerator Program (SERP) that offered a prize of up to $30 million
for the development of a commercially viable CFC-free refrigerator
that surpassed federal efficiency standards by at least 25%.  Actual
prize payment was to be awarded based on the number of units sold.
While Whirlpool won the competition in 1994, exceeding the program=92s
efficiency requirements, falling energy costs and delayed
implementation of federal efficiency standards led to lower than
expected sales and a lower prize payment.

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

In 1995, the Ansari family sponsored the first X Prize.  The X Prize
was modeled after the Orteig Prize won by Lindbergh, and offered $10
million for the first private team to build and launch a spacecraft
capable of carrying three people to an altitude of 100km twice within
two weeks.  Mojave Aerospace Ventures won the prize in 2004 with a
spacecraft designed by Burt Rutan.  The prize garnered significant
media attention, and significantly raised the public profile of
commercial spaceflight.

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

In 1997, Budweiser announced a $1 million prize, half of which would
be donated to charity, for the first non-stop balloon flight around
the globe.  Bertrand Piccard and Brian Jones won the prize in 1999
for meeting what was called the =93last great aviation challenge of the
century.=94

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

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.

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

In 2003, the Defense Advanced Research Projects Agency announced the
first DARPA Grand Challenge: $1 million for the first robotic vehicle
to complete a course from California to Nevada in under 10 hours.
Multiple teams competed for the prize in 2004, but none completed the
course.  A second Grand Challenge was held in 2005, with the Stanford
Racing Team winning the $2 million prize.  A third Grand Challenge is
scheduled for November 2007 on a 60 mile simulated urban course, with
a total of $3.5 million in prizes to be awarded.

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
=93qualified countermeasures=94 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=92s 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 =93a commercially
viable design which results in the removal of anthropogenic,
atmospheric greenhouse gases so as to contribute materially to the
stability of Earth=92s climate.=94  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
=93Advanced Market Commitment=94 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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----------------------------------------------
James Packard Love
Knowledge Ecology International
http://www.keionline.org
james.love@keionline.org
Washington, DC +1.202.332.2670

"If everyone thinks the same: No one thinks." Bill Walton"