New York Times:
Pentagon Redirects Its Research Dollars
By JOHN MARKOFF
Published: April 2, 2005
SAN FRANCISCO, April 1 - The Defense Advanced Research Projects Agency at the Pentagon - which has long underwritten open-ended "blue sky" research by the nation's best computer scientists - is sharply cutting such spending at universities, researchers say, in favor of financing more classified work and narrowly defined projects that promise a more immediate payoff.
Hundreds of research projects supported by the agency, known as Darpa, have paid off handsomely in recent decades, leading not only to new weapons, but to commercial technologies from the personal computer to the Internet. The agency has devoted hundreds of millions of dollars to basic software research, too, including work that led to such recent advances as the Web search technologies that Google and others have introduced.
The shift away from basic research is alarming many leading computer scientists and electrical engineers, who warn that there will be long-term consequences for the nation's economy. They are accusing the Pentagon of reining in an agency that has played a crucial role in fostering America's lead in computer and communications technologies....
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University researchers, usually reluctant to speak out, have started quietly challenging the agency's new approach. They assert that Darpa has shifted a lot more work in recent years to military contractors, adopted a focus on short-term projects while cutting support for basic research, classified formerly open projects as secret and placed new restrictions on sharing information....
http://www.nytimes.com/2005/04/02/technology/02darpa.html