How Funding
Who
What
How Platform
How Context

Funding and
Capital Flows
Human Resources
and Performers
Markets
Consumer, Services, Commercial,
Industrial, Local, National,
International
Infrastructure
Regulation
Broadband Mobile
Venture Capital
Small, Medium, Large
Tech Firms
Product Development
Open Community
Development
Industry
Industrial and
Government Labs
Advanced Concept
Technology
Platforms
Applied Research
Government
Universities
Research Computing
and Networks
Basic Research
Foreign
Workers
Foreign
Students
K– 12

Applications Pull

Trade Financial Accounting Rules and Regulations Intellectual Property R&D Tax Credits Pensions Health Care Immigration Government and Industry Policies for R&D Funding

 

has been achieved, not just from the government investment in foundational research, but from a vibrant venture community able and willing to provide the risk capital to fund the commercialization of new ideas from which such industrial sectors are able to grow.

Assessing the ecosystem

The U.S. IT R&D ecosystem was the envy of the world in 1995; Figure 2 outlines its essential elements: university and industrial research enterprises; emerging start-up companies and more mature technology companies; the industry that finances innovative firms; and the regulatory environment and legal frameworks. From the perspective of IT, the U.S. enjoyed a strong industrial base, the ability to create and leverage new technological advances, and an extraordinary system for creating world-class technology companies.

The period from 1995 to the present
has been a turbulent one for the U.S.
and the world, as characterized by:
Irrational exuberance for IT stocks ˲
and the NASDAQ bust (2000);

Y2K and the development of the ˲ Indian software industry;

Aftereffects of the terror attacks of ˲ September 11, 2001;

Financial scandals and bankrupt- ˲ cies (2001);

Surviving after the bubble burst ˲ (2001–2004);

Recovery (2005–2007); and ˲

Global economic financial crisis ˲ (2008).

These shocks took their toll, and in
the view of the committee, government
actions are necessary to sustain the
U.S. IT R&D ecosystem. The U.S. gov-
ernment should:
Strengthen the effectiveness of ˲
government-funded IT research;

Remain the strongest generator of ˲ and magnet for technical talent;

Reduce the friction that harms the ˲
effectiveness of the U.S. IT R&D ecosys-
tem while maintaining other impor-
tant political and economic objectives;
and
Ensure that the U.S. has an infra- ˲
structure for communications, com-
puting, applications, and services that
enables U.S. IT users and innovators to
lead the world.

Potential high-value societal ben-
efits of continued investment in IT in-
clude:
Safer, robotics-enhanced automo- ˲
biles;

A more scalable, manageable, se- ˲ cure, robust Internet;

Personalized and collaborative ed- ˲ ucational tools for tutoring and just-in-time learning;

Personalized health monitoring; ˲

Augmented cognition to help peo- ˲
ple cope with information overload;
and
IT-driven advances in all fields of ˲
science and engineering.

Much has been learned from de-
cades of experience about what con-
stitutes an environment that fosters
successful research and its transition
to commercial formation. The follow-
ing insights are extracted from a 2003
Academy report from the National
Research Council called Innovation in
Information Technology (The National
Academies Press, Washington, D.C.,
2003 http://www.nap.edu/openbook.
php?isbn=0309089808):
On the results of research:
U.S. international leadership in ˲
IT (vital to the country) springs from a
deep tradition of research;

The unanticipated results of re- ˲
search are often as important as the
anticipated results; and
The interaction of research ideas ˲
multiplies their effect; for example,
concurrent research programs target-
ing integrated circuit design, computer
graphics, networking, and workstation-
based computing strongly reinforce
and amplify one another.

On research as a partnership:
The success of the IT research en- ˲
terprise reflects a complex partnership
among government, industry, and uni-
versities;

The federal government has had ˲ and will continue to have an essential role in sponsoring fundamental research in IT (largely university-based) because it does what industry cannot do. Industrial and governmental in-