JOHN WHELAN is acutely aware that success in industry means staying ahead of the trend curve. The director of Alatto, which provides services to mobile phone operators, saw his first business, supplying mobile-phone gaming services, fall victim to the dotcom era.

Now, however, thanks to some targeted research, Alatto provides Vodafone Ireland with a picture-messaging platform that it designed. For O2, it created a service that allows customers without picture phones to retrieve images sent to them via their PC.

Better still, Whelan believes his newest product is the firm’s most exciting. It enables users to find web content of interest to them more easily, rather than the generic material that phone providers typically offer. “Right now everyone in mobile-phone applications wants to be to mobile phones what Google was to PCs,” said Whelan. Since launching five months ago, the product has been snapped up by seven leading European mobile phone firms.

That does not mean Alatto has stopped searching for new ideas. To this end, Whelan last week attended an event organised by Enterprise Ireland that introduced entrepreneurs and businesses to third-level technology research just ripe for commercialisation.

Topics ranged from throat- cancer-screening technology to mobile-phone software. “The focus was to link like-minded people from business, finance and the Irish research communities with the aim of creating mutually profitable relationships,” said Gearoid Mooney, the director of informatics research and commercialisation at Enterprise Ireland. The event is just one example of its commitment to increasing research and development (R&D) activity among Irish firms (see panel).

“One of the ways small companies can get additional resources, both intellectual and financial, is to do some work in co-operation with the third-level sector,” said Mooney.

Last year, Enterprise Ireland contributed €40m to Irish firms’ R&D activity, at a grant aid rate of about 35%. Now it is inviting companies to indicate what their future research needs might be. It will then put them out to tender to the various Irish universities. Enterprise Ireland will fund them too.

“What stops small firms in particular from engaging in R&D is lack of know-how and where to find it,” said Mooney. “We can help — and financially too — but you’ve got let us know what you need.”

Irish business R&D expenditure is estimated to have been worth €1.1 billion last year, a figure set to rise over the next five years. Certainly the graph is going in the right direction. According to Forfas, the figure rose annually by more than 9% between 2001 and 2003, up from a 7% annual expansion between 1999 and 2001.

The ratio of R&D spend to economic activity rose to 0.97% of gross national product (GNP) in 2003, compared with 0.93% in 2001. However, this still lags behind the European Union average of 1.13% in 2003. Activity varies according to sector too, with the figure rising in pharmaceuticals, holding steady in electronics and computer-related sectors, but falling in food and drink.

Also, foreign-owned companies accounted for almost three quarters of all business-related R&D expenditure in Ireland. Enterprise Ireland wants to see the overall figure rise to €2.5 billion by 2010, almost doubling it to 1.7% of GNP. As part of this, it has set targets such as the doubling of indigenous firms with R&D activity in excess of €100,000, from 525 in 2001 to 1,050 by 2010.

The number of indigenous firms engaged in R&D activity worth in excess of €2m is set to rise from 26 to 100 in the same period. To support this, the government has introduced tax credits for companies carrying out additional R&D in Ireland.

Alternatively, Europe’s innovation relay centres (IRCs) are an EU initiative designed to facilitate technology transfers. The centres, which are managed here by Enterprise Ireland, are the leading European network for the promotion of technology partnerships and transfer between small firms.