The investment division of Intel, the Intel Capital, has confirmed that European venture funding is going to decrease. In 2005, the company has invested a record share of its revenue - $60.91 billion, but the last year brought European companies only 40 billion. This year's fundings hit the bottom, with only $6.57 billion.

"We continue to be well in the shadows of the U.S. in terms of the amount of dollars being committed to the venture industry", Ashish Patel, managing director of Intel Capital UK, said last week.

Intel has adopted new investment politics and is willing to cut down the number of start-up companies to receive financial support. In exchange, the chip manufacturer will increase the amount of dollars each selected European company is going to receive. "The average start-up is funded better but the amount of dollars invested into the start-up environment continues to be the same. Therefore, the number of deals that are being invested in is going down", continued Patel.

European investment is only a small fraction when compared to the US funding programs the company has initiated. The UK funds alone represent 50 to 60 percent of the European market for venture capital funding, and even though Intel is cutting down their investment budget year by year, the business will be given more time and money to sustain the research.

"There are fewer deals but the average funding going into each deal is on the increase", said Patel. "Back in 2001, most of the start-ups were underfunded, so you had good ideas which were starved of cash. Before they could even take off, they ran out of cash and went bust."

For the next year, Intel is especially concerned with developing ecologically friendly technologies and will offer large amounts of money for research in this direction.

"The frustrating thing is that Europe has a lot of (intellectual property) in this area that is not being funded", said Patel, adding that Intel is very rapidly trying to bridge that gap but will focus only on clean technology that has a strategic relevance to what it is doing as a company. Patel said "that is anything that aims to reduce carbon usage."

According to Patel, one of the domains that will not get Intel's financial attention is the mobile Internet, since the main obstacle is not the lack of technology, but the telecom carriers' lack of interest in providing Internet access.

"(While) everybody wants to be connected to the Web all the time, it isn't happening, and one reason is the telecom operators don't know how to function other than as telecom operators."