On Monday, FEI (NASDAQ:FEIC) announced the unveiling of its new scanning/transmission electron microscope, the Titan. This is good news for investors of the Hillsboro, Ore.-based nanotech equipment manufacturer because it demonstrates that FEI is striving to meet the needs of its customers, including Intel (NASDAQ:INTC), Hewlett-Packard (NYSE:HPQ), and Seagate (NYSE:STX).

It is bad news for FEI's competitors, including Veeco (NASDAQ:VECO), Applied Materials (NASDAQ:AMAT), and KLA-Tencor (NASDAQ:KLAC), because it now more clearly places those companies further behind in the "race to the bottom" to characterize, see, and assess materials at the atomic and subatomic level.

The Titan can provide resolutions of less than one angstrom (one angstrom is one-tenth of a nanometer). This is important because it strongly suggests the equipment will find a home among the leading nanotech research institutions around the world.

Given that some $8 billion is expected to be invested in the field this year, FEI should be able to capture a nice sliver of those nano-dollars by helping researchers see at this ridiculously small level.

The bigger opportunity for FEI lies in its ability to use the equipment to move beyond the research labs to the manufacturing lines. Semiconductor manufacturers, in their never-ending quest to make circuits smaller and smaller, need advanced equipment like the Titan to test, repair, and manufacture next-generation integrated circuits. If the Titan -- which is still in the process of being rigorously evaluated by some of FEI's customers -- proves successful, it could represent a large increase in the demand for its equipment.

But that's only half the potential. Because the Titan can also characterize viruses, cells, DNA, and proteins, it can help scientists better understand the chemical basis for life. In short, the equipment should help companies such as Pfizer, Merck, and Eli Lilly reduce the process development costs of new drugs, improve yields, and reduce the time-to-market.

It is my opinion that this announcement definitely gives FEI a leg up on its main nanotech-equipment competitor -- Veeco. In the nanotech game, smaller is better; and it is why, of the two companies, I'm more bullish on FEI.

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Fool contributor Jack Uldrich has been thinking small since grade school. He is the author of The Next Big Thing Is Really Small: How Nanotechnology Will Change the Future of Your Business. He owns shares of both FEIC and VECO. The Motley Fool has a disclosure policy.