As noted earlier, research in computing, information, and communications is caught in the middle in a heated debate over "basic" versus "applied" research. In fact, most of the research in information technology supported by DARPA and NSF -- research supported until recently under the High Performance Computing and Communications Initiative, and before that under its predecessor initiatives -- occupies a complex middle ground, which can be characterized as "fundamental research in support of strategic directions."
This research is high-risk, and when it pays off it does so over an extended period -- typically 10-15 years. But it is motivated by problems that need to be solved, and when successful, it ultimately provides the people and ideas that renew existing companies and create new ones.
Many key points concerning research in information technology are carefully made in the National Research Council HPCCI study. We include one table and one figure from that study here.
Table 1.1 shows that many transforming technologies that we take for granted today have their roots in the federal research program, and that while each of these research thrusts was pursued with a strategic goal in mind, the unanticipated results often were at least as significant as the anticipated ones -- a hallmark of fundamental research.
Figure 1.2, which focuses on the same technologies as Table 1.1, shows that the simple "linear model" of technology transfer -- from basic (university) to applied (industry) -- is not what happens in practice; this figure nicely illustrates the rich flow of people and ideas back and forth across the academic/industrial boundary. The figure also demonstrates that the federal research program in information technology pays off over an extended period of time: typically 10-15 years elapses from the initiation of the research to the establishment of a billion dollar industry.
While the motivation to keep the government out of very near term research is clear, an overly simplistic model of basic versus applied research would be exceedingly damaging. The DARPA and NSF research programs in information technology can be characterized as "fundamental research in support of strategic directions." It's a model that has been hugely successful.