John Markoff writes in detail in Saturday’s NY Times about DARPA’s diminishing investment in university-based computer science research and its potential impact.

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.
“I’m worried and depressed,” said David Patterson, a computer scientist at the University of California, Berkeley who is president of the Association of Computing Machinery, an industry and academic trade group. “I think there will be great technologies that won’t be there down the road when we need them.”

Markoff’s piece is largely based on answers the agency provided the Senate Armed Services Committee in response to the committee’s questions about DARPA’s historical support of IT R&D and the role of universities. In their response, DARPA noted that their overall support for computer science activites has averaged $578 million a year (inflation adjusted) for the last 13 years and that university participation in that research over the last 4 years has plummeted. (Due to “data constraints” they don’t have figures prior to FY 01.) In FY 01, DARPA funded $546 million in IT research overall, $214 million in universities. By FY 2004, the overall funding had risen to $583 million, and the university share had dropped to $123 million.
DARPA cited five “factors for the decline”:
1. A change in emphasis in the high performance computing program from pure research to supercomputer construction;
2. Significant drop in unclassified information security research;
3. End of TIA-related programs in FY 2004 due to congressional decree, a move that cost universities “a consistent $11-12 million per year” in research funding;
4. Research into intelligent software had matured beyond the research stage into integration;
5. Classified funding for computer science-related programs increased markedly between FY 2001 and FY 2004, but Universities received none of this funding.
Essentially, they conceded that their focus in IT R&D is increasingly short-term (at least in the unclassified realm) and that universities are no longer significant performers of DARPA IT R&D (classified or unclassified). Not surprisingly, these are the two major concerns CRA has repeatedly cited about the agency.
Anyway, the article is a must read.
Update: (4/3/2005) – Noah Shactman at Defense Tech has a bit more: Darpa may be investing more in super-secret computer science research. But overall, the agency’s proposed classified budget has shrunk by over a third, a Congressional source tells Defense Tech.