San Diego’s innovation economy continues to move mostly sideways, with venture capital investments plunging and employment improving slightly among high technology and life sciences startups, according to a report today from Connect, the nonprofit group for technology and entrepreneurship. The mixed signals also showed San Diego’s merger and acquisition activity soared and federal grants to researchers strengthened during the last quarter of 2010.

A .pdf file for the full report can be downloaded here. My breakdown of the highlights and leading indicators for San Diego’s innovation economy follows:

—Eighty-four high tech and life sciences startups were formed in the region during the fourth quarter of 2010, a 13 percent increase from the same quarter of 2009, when 74 new companies were started. For the year, the report counted 277 new startup companies, which was a 13 percent decline from the 319 startups founded in 2009.

—Mergers and acquisitions jumped substantially across California in 2010 compared to the previous year. The value of reported San Diego M&A deals that closed during the fourth quarter was almost $1.7 billion. The nearly $4 billion in M&A deals reported here in 2010 was more than double the value of deals reported 2009. In Southern California, the M&A market in 2010 totaled more than $40 billion—almost seven times more than what was reported in 2009.

—Combined funding from the National Institutes of Health and the National Science Foundation for scientists in the San Diego area increased in 2010 to $42.5 million per 100,000 residents from $34.4 million per 100,000 in 2009. The report says that makes San Diego one of the state’s top innovation economies, based on federal grants received per capita. Total NIH financing for this region was almost $1.2 billion in 2010, a 28 percent gain from 2009, while NSF support amounted to almost $126 million, a slight increase from 2009.

—In the fourth quarter, San Diego got $278 million in NIH backing, and more than $31 million from the NSF.

— San Diego innovation companies received almost $32 million in Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) program grants in 2010, according to new data from the Department of Defense.

—As we reported in January, venture capital investors put … Next Page »

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The way some people talk, the annual report from the Software Equity Group is the software industry’s equivalent to “The Baseball Abstract,” the wildly popular report on hitting, pitching, and fielding statistics that Bill James began publishing in Kansas 34 years ago.

“Nobody else comes close to capturing the trends and transactions in the software industry that they have,” says Jeb Spencer, a co-founder and managing partner at TVC Capital, a small private equity firm in San Diego that invests only in software companies. It’s also surprising to many, Spencer says, that the best and most thorough analysis of the software industry’s transaction activity is put together by a boutique investment banking firm in San Diego.

But it’s certainly being read carefully at the higher levels of software companies, buyout firms, and elsewhere. The 2010 Software Industry Equity Report provides data, insights, analysis, and other information about software mergers & acquisitions, public software developers’ financial and stock market performance, software industry market trends, initial public offerings, and venture capital investments. It also includes the Software Equity Group’s 2011 “Buyer Survey,” which offers insights into the acquisition strategies at the largest software companies in the world.

JMI Equity managing partner Paul Barber tells me the report is an excellent resource to benchmark a software company’s performance against their peer group. And Mission Ventures managing partner Leo Spiegel says the annual report fills a gap in terms of providing in-depth industry research that is no longer available from many major financial institutions, which have cut back on equity analysts who make “buy” and “sell” recommendations on certain companies as a service to investment clients.

They are hardly alone. The Software Equity Group says it has sent copies of its 2010 Software Industry Equity Report to 20,000 subscribers in 64 countries. Customers, who are willing to pay $595 a copy, include software industry executives, venture capitalists, private equity investors, and other investment banks.

The latest report predicts that software mergers and acquisitions will ramp up significantly this year, after M&A deals increased … Next Page »

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With the Apple iPad set to hit stores at 9:00 a.m. on Saturday, you can probably guess what my digital media column, World Wide Wade, is going to be about this Friday.

But this time I want to leaven the punditry with some populism—so I’ve put together a quick, 9-question survey at SurveyMonkey. Please head over there and take a few minutes to share your opinions about Apple’s “magical” and “revolutionary” new tablet device.

Depending on which commentator you listen to, the iPad is either going to unleash a huge new wave of entertaining and educational digital content and overturn all of our old notions about personal computing, or destroy the tradition of open software development that has made computers and the Web so powerful.

The reality will probably be somewhere in between—but this week it’s your opinions as tech-savvy consumers of startup and innovation news that we’re interested in. I’ll report back on the survey’s results in my column this Friday.

Here are the questions — please head over to SurveyMonkey to register your answers. And please leave comments in the boxes provided; I’ll excerpt the most interesting answers.

1. Are you planning to buy an iPad?

2. If you are planning to buy an iPad, which version do you prefer?

3. Which features of the iPad appeal to you most?

4. Which missing iPad features would you most like to see added in a future version?

5. Where do you see yourself using an iPad?

6. Will the iPad be a better e-book reading device than the Amazon Kindle and other electronic-ink-based reading devices?

7. Some observers condemn Apple for the restrictions and secrecy it imposes on third-party app developers. Do you generally agree with this critique?

8. Following up on Question 7, has your opinion about Apple’s culture of control influenced your decision about buying an iPad?

9. The big picture: What impact will the iPad have on consumer expecations about personal computing? Choose the answer that comes closest to your view, or write one in.

Go to the survey.

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Following a nationwide trend, venture capital investments in San Diego region strengthened during the second quarter that ended June 30, but still remained well below funding levels at this time last year.

Regional data released by Dow Jones VentureSource shows VCs invested $208.8 million in 25 San Diego deals, a 40 percent decline from the $350 million that Dow Jones counted in 28 local startups during the same quarter last year. But it was still better than the first quarter of 2009, when Dow Jones counted $194.6 million in 15 deals. Nearly three-fourths of the total, or $154 million, was invested in 13 life sciences startups in San Diego, according to Dow Jones VentureSource. Another $50.1 million went to fund 4 information technology ventures in San Diego.

“For good or for bad, San Diego does tend to mirror the trends that we’re seeing on a national basis,” says Dan Kleeburg, an audit partner and the life sciences practice leader with accounting firm Ernst & Young’s San Diego office.

VCs put a total of $172.2 million into 22 startups in the San Diego region during the quarter, according to data released by the National Venture Capital Association, PricewaterhouseCoopers and Thomson Reuters. That was better than the previous quarter, when VCs put just $90.6 million into 15 local ventures—but a nearly 55 percent decline from the $379.6 million that went into 39 startups in San Diego during the second quarter of 2008.

The VC downturn seems to have leveled off, and companies that are near profitability or have a good story for getting to profitability in six to 12 months are getting attention, says Drew Senyei, managing director of San Diego’s Entreprise Partners Venture Capital. “Concept or early stage, highly screened and vetted plans are getting done, but with a ‘one and done’ syndicate concept,” Senyei tells me. “In other words, investors that are doing those deals want to make sure the companies have plenty of cash and do not have to go outside the initial syndicate in these difficult times.”

Avalon Ventures, which is among a handful of San Diego VCs that remain active, made nine venture investments during the quarter, says Kevin Kinsella, Avalon’s founder and managing member. Avalon made four new investments (one local tech startup and three out-of-town tech startups), and five follow-on investments (three local life science startups, one out-of-town life science venture and one out-of town tech venture). Avalon, which specializes in early stage investments, has done a similar number of deals in the previous two to three quarters. But Kinsella says, “Our willingness to back a new company is diminishing rapidly,” because Avalon has nearly finished investing the $150 million it raised for its eighth fund early last year.

See next page for the region’s top venture financings of the second quarter

… Next Page »

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New England companies raised more venture dollars and completed more VC deals in the second quarter of 2009 than they did in the first three months of this year, according to two reports on venture investment activity released recently. Still, the total number of deals and capital invested in the region during the three months that ended June 30 are way off from a year ago.

Firms in New England invested a total of $640.1 million in 85 deals during the second quarter, down from $1.05 billion that went into 94 deals during the same period last year, according to Dow Jones VentureSource. Perhaps some solace can be derived from the fact that the 85 deals done during the quarter amounted to a 57 percent increase over the 54 VC deals completed during the first quarter of 2009. Total VC dollars invested, however, increased by less than 2 percent, to $640.1 million in the second quarter from $629.2 million in the first three months of 2009. (See our Top 10 Deals list for the quarter on page 2 of this article.)

Regional data from The MoneyTree Report released yesterday by PricewaterhouseCoopers, the National Venture Capital Association, and Thomson Reuters shows a similar trend. The MoneyTree survey counted $466.9 million invested in 76 deals during the second quarter, down from the $825.8 million that went to 128 deals during the same quarter of 2008. (The rival surveys use different methods, sources, and criteria to prepare their respective reports.) MoneyTree showed a 15 percent uptick in venture capital invested from the previous quarter, but only an 8.6 percent increase in the number of deals.

Despite the rise in venture activity compared to the first quarter, the recession still appears to be weighing on VC firms’ willingness or ability to dole out money to tech startups. The Dow Jones figures show that deal amounts in New England are getting smaller even in sectors like healthcare where venture-backed companies are keeping pace with the number of deals they completed last year. And if what venture investors tell us is true, many recent deals involve older companies in need of capital to stay afloat until those companies can go public or find a corporate buyer. That could mean less money for new startups in search of capital to get their operations off the ground.

Here are some of the key figures that Dow Jones reported:

—The median deal amount across all sectors in New England was $4 million in the second quarter of 2009, way down from the median deal size of $7.6 million during the same period last year.

—The number of the region’s healthcare deals—involving biotech, medical devices, healthcare IT, and health services firms—was up slightly in the second quarter compared to the same period last year, from 28 to 29 financings. But total dollars invested fell to $370.3 million in the second quarter from $444.6 million in Q2 of 2008.

—Energy companies in the region raised only $8.2 million in four deals in the second quarter of this year, down from $24.4 million in six deals in the same quarter last year.

—The number of IT deals held relatively steady at 35 in the second quarter, down from 40 deals in the same period of 2008. Still, the total raised declined from $398.4 million to $150.2 million in the same quarter-to-quarter comparison.

See next page for the region’s Top 10 venture financings of the second quarter. … Next Page »

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Venture capital invested in U.S. startups during the second quarter was roughly half the amount invested during the same quarter last year, but two venture capital surveys found encouraging signs of improvement from the abysmal first three months of 2009.

VCs put $3.67 billion into 612 deals during the three months that ended June 30, according to the MoneyTree Report from PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters. That’s down 51 percent from the dollars VCs invested during the same quarter last year, when $7.56 billion went into 1,059 deals nationwide. On the bright side, the capital allocated from April through June represents a 15 percent gain over $3.2 billion invested during the first three months of the year, which hit the lowest level since the first quarter of 1997, according to the MoneyTree Report.

It’s also a less impressive rebound than was suggested in the early read on VC data we got last week from ChubbyBrain.

Q2 VC activity

Dow Jones VentureSource highlighted a similar trend in the VC data it released over the weekend, which shows $5.27 billion was invested in 595 deals during the second quarter. While that’s still dramatically lower than the $8.3 billion that Dow Jones counted in 726 deals during the same quarter last year, it marks a 32 percent improvement over Dow Jones’ numbers for the first quarter. The trends spotlighted by the two reports are often comparable, but Dow Jones and MoneyTree use different methods, sources, and criteria to generate their respective data.

Beyond the broad trends, there are interesting details in both reports. For example:

—VCs invested a total of $1.5 billion in 160 life sciences companies during the second quarter—marking a 47 percent rebound over the prior quarter, according to the MoneyTree Report. “This is the most amount of money we’ve ever seen going into this sector, and considering the environment out there, that is quite a statement,” says Tracy Lefteroff, global managing partner of PricewaterhouseCoopers’ venture capital practice. Dow Jones VentureSource highlights a similar … Next Page »

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We got an early peek at second-quarter VC investing today from ChubbyBrain, a New York-based information service (and new Xconomy partner) that uses a “structured wiki” to collect data on startups, and monitors venture capital investments nationwide.

ChubbyBrain says venture activity bounced back, with more than $5.3 billion invested during the three months that ended in June. That’s up nearly 61 percent over the first quarter of 2009, when ChubbyBrain shows VC firms invested $3.3 billion nationwide. The strong rebound pretty much dispels speculation that investment levels would inch up slowly, according to ChubbyBrain co-founder Anand Sanwal

ChubbyBrain says the number of deals totaled 613 during the quarter, but it’s not possible to compare to its data for the same quarter in 2008, since it’s just starting out. Think of it as an exit poll until we get more detailed results early next week as the National Venture Capital Association and Dow Jones VentureSource release their data. In the meantime, ChubbyBrain provides some other insights:

—Healthcare was the biggest sector getting venture investments during the three months that ended in June, garnering 37 percent of VC dollars nationwide. Investments in Internet startups, which got 14 percent of the total, represented the next-biggest category, while energy-related startups got 10 percent.

—Most of the money, as usual, was invested in California. Almost 43 percent of the $5.3 billion was invested in the Golden State. Massachusetts got 9 percent of the dollars and about 8 percent went to Washington state. (ChubbyBrain breaks out its results by state, but not regional or metropolitan areas.)

—It has been widely reported that many venture capital firms are performing financial triage on their porfolio companies, so many expected VC funding for seed and early stage startups would suffer. But ChubbyBrain reports “healthy levels of early stage investment in Seed and Series A rounds, accounting for 35 percent of the total number of deals.

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Ladies and gentlemen, Xconomy readers have spoken, and the view is optimistic. We posed several questions about what the coming year will bring for the economy as people registered for our June 24 Xconomy Summit on Innovation, Technology, and Entrepreneurship (XSITE). The recovery, they think, will start soon: 24 percent of the first 130 respondents believe U.S. gross domestic product will begin to grow again in the fourth quarter of 2009, and nearly 70 percent of the respondents believe growth will return between the fourth quarter of this year and the second quarter of 2010.

The survey also indicates that next year might bring wind farms to Boston Harbor—or that we could all be pumping our Priuses full of algae-produced gasoline (talk about green fuel). When asked to name what sector of the New England innovation economy will grow fastest in 2010, 35 percent of XSITE registrants surveyed selected cleantech. Biotech was a close second with 26 percent, and healthcare was third with 23 percent of the vote. The lone write-in vote was for the mobile industry; iPhone app developers, take heart.

In the final question, where respondents were asked to predict where the Dow will close on Jun 24, the day of XSITE, 69 percent selected the 8,000-8,999 range. As of today, it sits squarely in the middle of that range, around 8530. We’ll see whose estimate was closest on June 24.

Registration is still open for our conference, so prepare to get (cautiously) XSITE-d!

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Americans are more concerned about someone stealing their Social Security Number (SSN) than their wallet, laptop, or purse, according to a survey released today by Ipsos and San Diego-based ID Analytics. Three in five Americans identified their SSN as the personal item they are most concerned about if someone breaks into their home. Almost 60 percent of American adults said they would rather reduce their identity theft by 20 percent than lose 20 pounds. The telephone survey, which was conducted in April, represents an adroit bit of indirect marketing by ID Analytics, which fights identity theft by using advanced pattern-recognition technology to spot fraudulent consumer transactions.

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A survey released today by Microsoft (NASDAQ: MSFT) says San Diego is the best midsize city in the United States for remote working. The nationwide survey commissioned by the Redmond, WA, software giant found that U.S. employers generally support remote-working programs, although just 39.4 percent have a policy that details how their employees can work from home. Microsoft says interest in remote working has been spurred by higher energy costs and the current economic crisis.

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[Updated Jan. 28, with information on Intellectual Ventures' patents (see below)]
If its volume of new patents is any indication, Microsoft is going to be just fine. The Redmond, WA, software firm blew away the rest of Washington state in terms of the number of patents it was granted last year. That’s according to IFI Patent Intelligence, based in Wilmington, DE, which recently released a national survey of patent grants for 2008. Xconomy obtained the figures for Washington state, as well as Massachusetts and California. (See the list of Washington’s top 25 patent winners below.)

Patent awards are, of course, just one measure of an organization’s competitiveness and inventiveness. It’s hard to draw definitive conclusions about a company’s ability to innovate based on its number of patents, say—imagine trying to compare a biotech company with an electronics firm, or a young software startup with an established powerhouse. But it’s still a key measure of an organization’s investment in its intellectual property.

Microsoft’s tally (2,030) is greater than the rest of Washington’s top 25 combined. It was good enough for fourth place nationally, behind IBM (4,186), Samsung (3,515), and Canon (2,114), and ahead of Intel (1,776). In Washington state, Sharp Laboratories and the University of Washington were a distant second and third, respectively.

A few other notables. Boeing is fairly low on the list (16th), in part because the figures only count patents awarded to each organization’s operations in Washington; patents awarded to offices or operations outside the state are not included in this list. Amazon ranks pretty low as well (12th), and Bellevue-based Intellectual Ventures, the invention company, is in 8th place, listed as “Searete.” Lastly, there was a seemingly random tie for 5th place between forestry firm Weyerhaeuser (which just closed two of its Washington mills this week) and biotech company ZymoGenetics (which just bought back the rights to its lead cancer drug candidate today).

Without further ado, here’s Washington state’s top 25 patent winners in 2008:

1. Microsoft — 2,030
2. Sharp Laboratories of America — 144
3. University of Washington — 47
4. Battelle Memorial Institute — 33
5. (tie)
Weyerhaeuser — 28
ZymoGenetics — 28 … Next Page »

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The early returns on venture capital investments that came in over the weekend from Dow Jones VentureSource pretty much confirmed what we’ve been hearing. VC firms are battening down the hatches to weather the economic downturn.

The nationwide survey showed venture funding in new companies declined by 30 percent during the last three months of 2008, with $5.5 billion going into 554 deals. That compares with $7.9 billion in 718 deals during the same quarter in 2007. The drop in the fourth quarter accounted for most, if not all, of the overall 8 percent decline for the full year, with $28.8 billion invested in 2,550 deals nationwide throughout 2008.

In the San Diego region, the survey showed VC investments plunged by 57 percent during the last three months of 2008. Funding for life sciences startups went into a freefall, dropping by 84 percent, which seemed to account for much of the overall downturn in the region. For example, VC funding for IT deals during the fourth quarter actually increased from almost $91.7 million in 2007 to $105.9 million in 2008.

Dow Jones VentureSource says $182.5 million went into 14 deals during the fourth quarter in San Diego. That compares with almost $425.6 million invested in 25 deals during the same quarter last year. In the healthcare category, the Dow Jones survey counted just $51.2 million in five San Diego deals in the fourth quarter; and $325.9 million in 11 deals during the same quarter in 2007.

The venture firms that specialize in life science deals are mindful about keeping more money in reserve, says Kevin Kinsella, founder of San Diego’s Avalon Ventures. “Because I can’t rely on my confreres to come in on my B round deals,” Kinsella says, it may be necessary to act as the “sole provider” for some startups during those years. “So that time is getting stretched out and that means fewer deals get done.”

Doug Obenshain, an Ernst & Young partner in San Diego who advises technology startups, says overall VC investing in the area last year, (87 deals for $1.14 billion) was roughly comparable to the average (97 deals and $1.14) billion for the years 2002 through 2006. He also noted VC investments were diversified across cleantech, communications, Internet, and life sciences startups. Still, Obenshain concedes, “The financial crisis in the fourth quarter has impacted nearly everyone, and it had an impact on venture financing as well.”

According to the survey released by Dow Jones VentureSource, the five biggest venture investments in the region during the fourth quarter were:

—Luxtera, a Carlsbad communications and networking equipment company, got $26.7 million in a later stage round that was dated Dec. 31, with funding provided by Advanced Equities Financial, August Capital, New Enterprise Associates, and Sevin Rosen Funds.

—Fallbrook Technologies, a San Diego automotive equipment startup, got $25.4 million in December in a first round led by NGEN Partners and Robeco Cleantech private equity.

—Anaphore, a San Diego biopharmaceutical, got $25 million in a first round led by 5AM Ventures, Versant Ventures, and Apposite Capital. (Anaphore reported the deal on Jan. 7, but Dow Jones VentureSource dated it Dec. 31.)

—Awarepoint, a San Diego wireless communications company, got $13.3 million in November in a later stage deal led by Avalon Ventures, Cardinal Partners, individual investors, undisclosed investors, and Venrock.

—Eventful, a San Diego software company operating a search portal, got $10 million in October from Bay Partners, Draper Fisher Jurvetson, and Telefonica Capital.

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Venture-backed companies are no doubt ready to put 2008 in the past. Year-end reports show a dismal number of initial public offerings and M&A deals last year, after a flurry of tech companies canceled plans to go public and buyout activity slowed to its lowest level in five years. 

Thomson Reuters and the National Venture Capital Association released their Exit Poll survey this morning, showing a scant six venture-backed companies completed IPOs in 2008. That’s the worst year for public offerings since an equal number of public debuts were recorded in 1977. Another tidbit of bad news is that five of those six companies are trading below their initial offering price.

The deal figures are similar to those reported Friday by Dow Jones VentureSource .

What’s more, there were two fiscal quarters without a single VC-backed IPO in 2008, which was the first year to have two quarters with zero IPOs since 1975. Forty venture-backed companies pulled their registrations for IPOs last year, another sign of the poor climate for public offerings. (We noted how slow IPO activity was in the Boston area last summer.)

The total number of venture-backed company M&A deals was 260, the first year since 2003 that the total was less than 300, according to the report. During the fourth quarter of 2008, M&A activity by sector was dominated by IT-related deals, which totaled 30, while life sciences and health care deals numbered just four, the report says.

There was only one venture-backed firm with ties to one of the three main markets covered here at Xconomy to appear on the report’s list of 2008 IPOs, Pennsylvania-based CardioNet (NASDAQ:BEAT), which has offices in its former home city of San Diego. (Apparently, Merrimack, NH-based GT Solar International (NASDAQ:SOLR) didn’t qualify as venture-backed, even though it completed an IPO last year.)

Here’s the NVCA and Thomson Reuters’ list of venture-backed IPOs in 2008:

— ArcSight (NASDAQ:ARST), a Cupertino, CA-based provider of compliance and security management software, completed a $61.8 million IPO.

— BioHeart (NASDAQ:BHRT), a Sunrise, FL-based biotech firm developing cellular therapies, had a $5.8 million maiden public offering. (Yep, that’s $5.8 million.)

— CardioNet (NASDAQ:BEAT), a provider of patient-monitoring software, wrapped up an $81 million IPO.

— IPC The Hospitalist Company (NASDAQ:IPCM), a provider of care services in hospitals, completed an $83.2 million IPO.

— MAKO Surgical (NASDAQ:MAKO), a Ft. Lauderdale, FL-based medical devices firm, raised $51 million in its public debut.

— Rackspace Hosting (NYSE:RAX), a San Antonio-based provider of IT services and Web site delivery, had the largest venture-backed IPO last year, valued at $187.5 million.

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A survey of technology startups in San Diego County shows 76 new companies were launched here during the second quarter of 2008, suggesting entrepreneurs kept busy despite broader economic declines locally and nationwide.

The study released by Connect, a local non-profit that supports innovative technology and life science businesses, found that San Diego County ranked second in startup activity statewide from April through June.

The 159 new companies launched in Los Angeles County during the second quarter eclipsed San Diego’s strong showing, however. Santa Clara County, in the heart of Silicon Valley, ranked third with 71 startups during the same period.

Of San Diego’s 76 startups, the two biggest categories were in the biomedical sciences and software. Each accounted for almost 28 percent of the total.

Connect’s data show a 36 percent increase in new tech businesses throughout California: from 430 started in the first quarter of 2008 to 585 such businesses in the second quarter.

A statewide trend in last year’s startup figures showed a huge surge in new companies formed during the second half of the year. The first and second quarters of 2007 saw 428 and 510 companies formed, respectively, while 922 companies launched during the third quarter and 1,367 businesses started in the fourth quarter. “Given the pattern established in 2007, the creation of tech businesses may still significantly increase in the 3rd and 4th quarters of 2008,” said Kelly Cunningham, Senior Fellow & Economist at the San Diego Institute for Policy Research.

On the other hand, Cunningham noted that venture capital was flowing near record levels in the second half of 2007. ”With the nation’s credit and housing markets in turmoil, consumers are drastically cutting back spending,” Cunningham said. “Business investment had been one factor supporting economic growth for the nation, but with liquidity also drying up, investment dollars are likely to be tight as well.”

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Text messaging, a longstanding habit among many Asian and European mobile phone users, is finally catching on with Americans. A major survey commissioned by Cambridge, MA-based speech-to-text software company Vlingo shows that 55 percent of all U.S. mobile subscribers send text messages—and 42 percent use their phones for texting as much as they do for calling. All of which is great news for handset manufacturers and cellular providers, who often charge by the message.

The bad news is that 28 percent of all survey respondents admitted to sending text messages while behind the wheels of their cars—which, let’s just be plain, is an incredibly stupid form of multitasking. Remember all those studies out of the University of Utah showing that talking on a mobile phone while driving reduces even a young person’s reaction time to that of a senior citizen? Texting is worse. Much worse.

And the practice is even more widespread among young people: 50 percent of teenagers surveyed in the Vlingo study and 52 percent of respondents aged 20 to 29 admitted to driving while texting, or “DWT.”

“To us, the message in the data is that we’ve got a problem now, but it’s going to get a lot worse as the younger generation comes up,” says Dave Grannan, Vlingo’s CEO. “It’s our belief that this is a serious public policy and safety issue that we need to address both with public policy and technology.”

We’ll get back to that “technology” part in a moment—since Vlingo does, of course, have an idea in mind about how software can reduce the danger from DWT. “Obviously there is some self-interest for us in putting out a report like this,” Grannan says. “The fact is that we’re a speech-to-text company, and we think there are hands-free solutions that can be developed.”

But in fairness, it should be said first that Vlingo didn’t set out to study the DWT issue specifically. It commissioned the independent research firm Common Knowledge Research Services to survey nearly 5,000 U.S. consumers from 48 states about their general text-messaging habits.

And in the process it discovered some interesting tidbits: almost 30 percent of respondents, for example, send more than 100 text messages per month, and 18 percent send more than 250. Almost 35 percent said that if they were unable to send text messages, it would have a negative impact on their lives. Among those who don’t text, the leading reasons were that it’s too expensive, that it takes too long, and that typing on a phone keyboard is a hassle.

It was when the researchers asked people about their texting behavior on the road, however, that things really got scary. Asked how often they drive and text simultaneously, 6 percent said they do it once a day, 8 percent said they do two to 10 times a day, and 1.5 percent said they do it more than 10 times a day. Among teenagers, 14 percent said they engage in DWT two to 10 times a day, and 8 percent said more than 10 times a day.

Texting from the road would be distracting enough if everyone had a Treo, a Blackberry, an iPhone, or some other device with a full QWERTY keyboard. But the survey found that 89 percent of respondents still have phones with standard 12-button keypads, which means they have to tap each key up to three times to get the letter they want. And if you’re watching your phone’s screen to see which letter you’re on, you’re probably not … Next Page »

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Last week, in our usual understated fashion, we here at Xconomy launched a new poll widget. It’s just another in a growing line of features—such as our recent podcasts and News Xpress offerings—that we like to drop into the site to hopefully engage and inform our readers (News Xpress is taking off, but I think we’re still waiting for someone to actually listen to one of our stories).

But back to our poll. We started with a simple question: If you had $10 million to invest in a New England growth cluster, what would you chose (in alphabetical order): biotechnology, clean energy, mobile, robotics, or Web 2.0. And you resoundingly answered (both of you—well, we actually got a fair number of responses) clean energy. A bit over half the votes (51 percent) went to this field, easily trouncing biotech (14 percent), Web 2.0 (14 percent), robotics (12 percent), and mobile (a scant 9 percent).

Which got me thinking…My own gut reaction is that our readers have it wrong. Given the incredible hype around cleantech, and the unknown time to fruition of many of these technologies, there is no way I would sink my precious $10 million in that field. In fact, my own fledgling theory, let’s call it a hypothesis, is that you would do much better if you flopped our survey results completely on their head. Your best payoffs would come first in mobile, then robotics, Web 2.0, biotech, and, lastly, clean energy.

That’s it—I have nothing else to say right now. We’re going to keep the poll up a while longer, both to see if my astute observations change the voting pattern (and also to give us time to think of another question). And if you’ve got a question you’d like to put to your fellow readers, please send it in to editors@xconomy.com.

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