The first big nanotechnology success story may be already sitting in the portfolios of millions of investors.

Some traders have soured on the

search for a nanotech start-up that can repeat the success that

Intel

(INTC) - Get Report

saw in semiconductors,

Microsoft

(MSFT) - Get Report

saw in software and

Google

(GOOG) - Get Report

has seen in Internet search. Judging from the scarcity of big names that have emerged after decades of nanotechnology research and years of hype, some have concluded that the science is just one big fizzle.

Reading between the lines of a new report by New York-based market research firm Lux Research, it's hard to avoid the conclusion that those frustrated investors are simply looking in the wrong place. It's the large, established companies that are investing in nanotech, doing the homework to turn the science into marketable products -- and they're the same ones that will be the first to harvest the results.

The report, titled

How Industry Leaders Organize for Nanotech Innovation

, underscores a point that many in the science have been making, often in vain: Nanotechnology isn't an industry per se, but a realm of innovation, materials and science that could potentially change many existing industries by making possible new products and new efficiencies.

That explains why, according to Lux, corporate R&D spending on nanotechnology is more than nine times greater than institutional venture-capital funding. In 2005, the 1,331 companies in 76 industries that Lux tracked invested $3.2 billion in nanotech and sold $32 billion in products that incorporate some form of nanotechnology.

While $32 billion is barely a drop in the $14 trillion bucket of revenue for those same companies, it's more than twice as much as the $13 billion in nanotech-related revenue in the previous year.

Of course, the bulk of those investments are in industries that are R&D intensive to begin with, including medical devices, aerospace and defense.

General Electric

(GE) - Get Report

, which has always had a sensitive antenna for promising innovation, earmarked $50 million for nanotech research last year, or 1.6% of its total R&D budget. CEO Jeffrey Immelt has ranked nanotech with personalized medicine and renewable energy as top priorities.

Lux expects things to really start taking off in the next couple of years. By 2008, nanotech R&D spending will more than triple, hitting $12 billion. The number of companies with initiatives specifically structured toward nanotechnology will double to 290, and the number of employees devoted to nanotechnology will rise more than sixfold as scientists and engineers are joined by sales and manufacturing staff.

"Between 2006 and 2008, nanotechnology's materials, tools and processes will become commonplace in many industries; by 2010, they'll be de rigueur," wrote Lux senior analyst Mark Bunger. "Competitors will grow smarter about which products incorporate nanotech, suppliers choosier about who gets their newest materials and buyers more demanding."

Even more significantly, more products will approach the markets, especially in the life sciences and electronics industries. Some 150 "nano-enabled cancer treatments" are in clinical trials, Bunger wrote. "Add to that applications like

Unilever's

(UL) - Get Report

functional foods,

DuPont's

(DD) - Get Report

automotive coatings and

Hewlett-Packard's

(HPQ) - Get Report

printable electronics that will be in-market, and more than $150 billion in goods will incorporate emerging nanotechnology -- triggering a cascade of operational effects like the need for worker retraining and new supplier selection."

Of course, some industries will be more affected by a wave of nanotech development than others -- chemical and semiconductor makers, in particular, but also metals, defense and pharmaceuticals. Many, from advertising to finance to travel, will feel the barest impact.

But others, such as automakers and food and beverage companies, will have a significant, if indirect, impact from nanotech innovations.

Honda

(HMC) - Get Report

and

Toyota

(TM) - Get Report

, for example, are both hoping to gain a competitive edge with nanotech investments.

Still, Lux's report points out, not all of the companies that will be heavily affected by new nanotechnology are preparing themselves. The efforts of many firms "are often a mishmash of grassroots evangelism, underfunded volunteer projects, investigatory committees and aimless partnerships."

Pharmaceutical companies are the worst laggards. "Large drugmakers are coming to the nanotech game very late," Bunger wrote. "These players believe they can simply acquire early-stage products after they enter clinical trials. By waiting until promising nano-enabled products mature, life-science giants deprive patients of needed drugs -- and shareholders of the profits that flow from them."

Bunger warns that, as nanotechnology develops into a more mature and more commonplace part of the marketplace, it will precipitate the kind of structural changes to industries that digital technology brought to film. Companies slow to adapt, as

Eastman Kodak

(EK)

was to digital cameras, will be left mired in endless restructuring.

In other words, an oil company that is today looking for a partner in the chemical industry to develop nanostructured solar cells will have an edge over less farsighted competitors. Bunger singled out

Boeing

(BA) - Get Report

as a company preparing on several fronts, not only by developing nanotechnology in house but also by building a chain of nanotech suppliers and partnering with research facilities at Northwestern University.

For investors, all of this means that nanotechnology will not turn many large companies into a pure play driven by their nano-innovations. Instead, it will give some companies a big chance to strengthen their hold in an industry and force others to fall by the wayside.

The time to start watching how companies are investing in and deploying nanotech won't come in some distant future. If Lux is right, that time is now. As Bunger put it: "The next four years form a short window of time for large corporations to reorganize."