1. FP7 from a large firm’s perspective EPP-ED Group Hearing on FP7 European Parliament, Brussels, September 22, 2005 Dr Jan van den Biesen MBA VP Philips Research, Director Public R&D Programmes

2. JvdB/05.039, September 22, 2005 2 From “Closed” to “Open” Innovation from …. to…. 100%100%PhilipsBusinessesPhilipsBusinesses PhilipsResearch Internal supply Philips Businesses BusinessesPhilips Technologyspin-outTechnologyspin-out JointVentures with Philips JointVentures PhilipsResearch External suppliers Spin-in of Technology Companies Institutes

3. JvdB/05.039, September 22, 2005 3 FP7 proposal – General comments Europe’s key challenge is not only acquiring more knowledge, but also turning knowledge into more economic value –Make European Innovation Paradox overarching issue of FP7 Open Innovation requires cooperation, not segregation –Academia  large firms  SMEs Industry is key actor in innovation –Declining participation in successive FPs must be reversed

4. JvdB/05.039, September 22, 2005 4 FP7 proposal – Specific Programme “Cooperation” Maintain cooperation as core of FP7 Continue & improve FP6 instruments for collaborative R&D –Ample room for smaller projects –Current Networks of Excellence not attractive to industry

5. JvdB/05.039, September 22, 2005 5 European Technology Platforms (ETPs) Promising concept –Industry-driven Strategic Research Agenda as input for Workprogramme Philips is actively engaged in many ETPs –Nanoelectronics* (ENIAC) –Embedded Systems* (ARTEMIS) –Mobile & Wireless Communications (eMobility) –Nanomedicine –Networked & Electronic Media (NEM) –Robotics (EUROP) –Photonics (EPIC) –Electromagnetic Compatibility (EMC; SEE) –(Potential) interest in Innovative Medicines*, Software & Services (NESSI) *: Joint Technology Initiative (JTI) envisaged by EC

6. JvdB/05.039, September 22, 2005 6 Joint Technology Initiatives (JTIs) Public-Private Partnerships for executing (part of) SRA –Match private resources with adequate public funding (EC + national) –Implement Art. 171 without excessive red tape Philips is actively involved in shaping two JTIs –Nanoelectronics (ENIAC) and embedded systems (ARTEMIS) –With close involvement of EUREKA clusters MEDEA+ and ITEA

7. JvdB/05.039, September 22, 2005 7 FP7 proposal – Other Specific Programmes “Ideas” –Supporting frontier research through ERC is excellent idea –Fund ERC in addition to existing FP activities “People” –Public-private mobility of researchers is key for Open Innovation –Take over key characteristics from FP5 Industry Host Fellowships “Capacities” –Support Open Innovation Centres

8. JvdB/05.039, September 22, 2005 8 FP7 proposal - Simplification Rigorous overhaul of FP implementation system is needed –Transaction costs (public + private) are economically out of proportion Introduce notion of “Responsible Partnering” to restore trust –Between public and private partners within consortium –Between consortium and Commission –Between Commission and other EU Institutions Take advantage of 2005 revision of Financial Regulation

9. JvdB/05.039, September 22, 2005 9 Concluding remarks Commission’s proposal for FP7 is sound By and large, Philips agrees with Working Document on FP7 –ITRE, June 23, 2005; rapporteur: Jerzy Buzek Philips calls upon European Parliament and Council to invest more in Europe’s future and double annual FP budget For comparison EU agricultural support for tobacco (CAP): ~0.9 billion €/yr EU research support for ICT (FP6-IST): ~0.9 billion €/yr EU research support for Life Sciences & Health (FP6-LSH): ~0.6 billion €/yr

10. JvdB/05.039, September 22, 2005 10