MEDIA LAB EUROPE, the troubled government-backed research institute, needs a cash injection of at least €50m to ensure its survival, a senior adviser to the taoiseach has warned.

The future of the Dublin-based facility, which was set up in 2000 with €35m of taxpayers’ money, has been under threat for some time due to a chronic shortfall in corporate sponsorship.

Media Lab has a cash burn of around €6m a year. It costs a company about €160,000 a year to become a member. Given the historic cash outlay, it would need 40 partners spending this amount just to break even.

A spokesman for Media Lab refused to comment on likely funding requirements but acknowledged that negotiations were ongoing with the government over the problem.

The figure of €50m eclipses previous estimates of the government funding required to keep afloat the flagship project, which counts Dave Evans, otherwise known as the U2 guitarist the Edge, and Denis O’Brien, the businessman, among its board of directors.

The 2003 accounts show the high-technology spin-off from the Massachusetts Institute of Technology’s (MIT) prestigious research facility spent €5.6m more than it raised in funding, which included backing from Eircom and Orange.

Sponsors can expect to gain unfettered access to all the intellectual property in the building, where about 100 employees work on various projects involving lateral thinking.

The latest uncertainty over the institute’s future in Ireland comes just 18 months after Media Lab Asia left Bangalore after negotiations with the Indian government broke down over the future direction of its research. MIT has also been forced to cut costs and reduce staff in its American base because of difficulties in attracting corporate sponsors after the dotcom bubble burst.

Analysts have concluded that companies are more interested in research and development that will yield immediate gains than the type of cutting-edge digital technology pioneered by Media Lab during the 1990s, which may not have short-term commercial value.