Adding even greater incentive to scientists striving to realize the era of the $1,000 genome sequence, J. Craig Venter announced today that he is seeking to increase the size of his foundation’s prize from $500,000 to as much as $10 million.

Venter made his surprise announcement in his role as host of the Genomes, Medicine and the Environment conference, currently taking place in Hilton Head, SC. He spoke at the conclusion of a strong session featuring presentations from three companies rapidly commercializing new sequencing technologies – 454 Life Sciences, Solexa, and Helicos.

Those presentations clearly demonstrated dramatic progress in DNA sequencing technology. 454 published a landmark paper in Nature earlier this year demonstrating the sequencing of a bacterial genome in four hours. Solexa announced that it would begin shipping its 1G Analyzer instrument – capable of sequencing 1 billion bases of DNA per instrument per day – by early next year.

Back in 2003, Venter’s science foundation established a $500,000 technology prize to stimulate developments in automated DNA sequencing technology that would bring about the sequencing of a human genome for about $1,000. “Once this threshold has been reached, it will be feasible for the majority of individuals to have their genome sequenced and encoded as part of their medical record,” Venter stated through his foundation in 2003.

At the conference, Tony Smith, vice president of Solexa, and 454 founder Jonathan Rothberg both said that they expected to reach the $100,000 genome plateau next year. Impressive as these milestones are, Venter clearly wants even faster progress. “I [previously] described the genome community when talking about cost as the Liar’s Club,” said Venter. “[We’re] trying to [raise] the prize by 10- to 20-fold. But we’re going to be putting some real limits on things.”

Noting that Solexa believes it can deliver a $10,000 genome by 2008, Venter said, “Our goal is really to have a $1,000 genome, but instead of having accountants tell us what it is, we’re going to require people to sequence maybe 100 genomes and really demonstrate the technology. So we’re trying to finalize the rules for this.”

“We’re thinking of a timeline that this has to be done sometime between 2008 and 2010. We’re trying to raise the prize value to reward the scientists that actually come up with these breakthroughs, not by calculation but by actual demonstration.”

Venter said he was in discussions with the X Prize Foundation, of which he is on the Board of Trustees, to find means of increasing the size of the award.