5
Findings and Recommendations

Providing a capability for overcoming barriers of distance and time, telecommunications is an essential element of the infrastructure for operation of the U.S. economy and society. Many U.S. companies—indeed whole new industries—have benefited from and even developed as a result of U.S. strength in telecommunications. Notably, the modern Internet and Internet-based businesses ranging from Cisco to Yahoo! would not have been possible without past telecommunications research leading to such advances as high-speed optical communications and packet-switched networks.

Today, however, the position of the United States as a leading producer of telecommunications technology, basic knowledge, and necessary human talent (a critical component—as described in Chapter 3) is at risk. The risk is magnified by the long period of time—as much as a decade or even longer—that it can take to translate a fundamental discovery or big new idea into a commercial product or service or to educate and train a new researcher.

The committee’s findings below outline challenges to the telecommunications sector’s continuing capacity for innovation. The recommendations that follow identify actions that the U.S. telecommunications industry, research community, and government should take together to strengthen the nation’s telecommunications research institutions and programs.

FINDINGS

Finding 1. The scope of telecommunications technology and of the industry itself has grown dramatically over the past few decades, driven primarily by the success of the Internet and its applications, by the digitization of all types of media and forms of communication, and by the rising importance of communications as a key enabling technology.

The telecommunications industry, which once consisted mainly of the telephone companies and their equipment vendors, has expanded greatly. It now includes a broad set of service providers, including telephone companies, cable operators, Internet service providers, and



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Renewing U.S. Telecommunications Research 5 Findings and Recommendations Providing a capability for overcoming barriers of distance and time, telecommunications is an essential element of the infrastructure for operation of the U.S. economy and society. Many U.S. companies—indeed whole new industries—have benefited from and even developed as a result of U.S. strength in telecommunications. Notably, the modern Internet and Internet-based businesses ranging from Cisco to Yahoo! would not have been possible without past telecommunications research leading to such advances as high-speed optical communications and packet-switched networks. Today, however, the position of the United States as a leading producer of telecommunications technology, basic knowledge, and necessary human talent (a critical component—as described in Chapter 3) is at risk. The risk is magnified by the long period of time—as much as a decade or even longer—that it can take to translate a fundamental discovery or big new idea into a commercial product or service or to educate and train a new researcher. The committee’s findings below outline challenges to the telecommunications sector’s continuing capacity for innovation. The recommendations that follow identify actions that the U.S. telecommunications industry, research community, and government should take together to strengthen the nation’s telecommunications research institutions and programs. FINDINGS Finding 1. The scope of telecommunications technology and of the industry itself has grown dramatically over the past few decades, driven primarily by the success of the Internet and its applications, by the digitization of all types of media and forms of communication, and by the rising importance of communications as a key enabling technology. The telecommunications industry, which once consisted mainly of the telephone companies and their equipment vendors, has expanded greatly. It now includes a broad set of service providers, including telephone companies, cable operators, Internet service providers, and

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Renewing U.S. Telecommunications Research wireless carriers, as well as equipment vendors offering fiber-optic, cable, and wireless connections. Telecommunications comprises all the hardware and software for the telecommunications infrastructure and the applications that run over that infrastructure. It involves communication of information in a wide array of media including voice, images, animation, video, documents, and data. Finding 2. Without a renewed and sustained investment in telecommunications research, the United States risks losing global leadership in telecommunications and related industries, with significant consequences for the U.S. economy and society. Should the United States be concerned if leadership in telecommunications moves offshore, as has occurred for many other entire industries? The recent fast pace of innovation, the array of new ideas to be pursued, and the substantial investment in telecommunications by other nations are all indications that telecommunications remains a high-value sector in which rapid innovation and fundamental change will continue well into the future. Far from a mature industry, telecommunications is thus one in which the United States should strive for continuing leadership. The importance of maintaining U.S. leadership is underscored by telecommunications’ critical contribution to U.S. leadership in information technology in general, its important contribution to improving productivity in nearly all industries, and its role in national security and homeland defense. Finding 2.1. The United States faces strong and growing competitive pressures from nations that are making significant investments in telecommunications R&D. Nations such as China, Japan, Korea, and member states of the European Union have identified telecommunications as a strategic area for economic development and have launched a variety of initiatives to enhance academic, industry, and joint industry-academic research in accord with vigorously promulgated national visions. Equipment vendors in a number of countries (such as China) now compete strongly with U.S. firms and have been very successful in emerging markets. Some nations’ active support for their domestic industries has extended beyond investment in research to include measures for protection of domestic telecommunications industries, thus placing further stress on the U.S. telecommunications industry. Finding 2.2. The health of the U.S. telecommunications sector depends on maintaining leadership in innovation. Telecommunications products and services generally become commoditized over time as multiple firms acquire the know-how to supply similar, competing products, and such competition has benefits in terms of lower prices for goods and services. To maintain leadership—or even a strong position—in telecommunications in the face of pressures from lower costs overseas for labor and other essentials thus requires that U.S. firms constantly focus on achieving high-value innovation as a foundation for developing non-commodity products and services. Research leadership in telecommunications by U.S. academic research institutions and government and industry labs has historically given the nation an advantage in terms of access to new technologies and the highest-caliber engineering talent. Notable benefits have accrued to the United States as a result of its leadership in defining the Internet’s design, for example. However—by virtue of its very success—the existing Internet architecture has become difficult to change. Despite many potential avenues for significant improvements in areas ranging from security to real-time audio and video transmis-

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Renewing U.S. Telecommunications Research sion, research and development has become largely incremental in nature. Moreover, the current architecture is largely commoditized, and firms from other nations will become increasingly able to deliver competitive products and services. Research aimed at defining future architectures promises particular benefits because U.S. firms will be positioned to offer new kinds of services and not just incremental improvements to existing ones. Finding 2.3. Without renewed investment and resulting opportunities to do research, it will be very difficult to attract, train, and retain the research talent required for the United States to maintain a strong position in telecommunications. Sustaining a base of researchers and research institutions is critical to the long-term health of a research discipline. Without adequate research funding, it will be hard to attract new students to the field, retain foreign students in the United States, provide critically needed support for postdoctoral researchers, or attract and develop new faculty and industrial researchers. Finding 2.4. U.S. critical infrastructure, national defense, and homeland security, which depend on having uninterrupted access to leading-edge telecommunications technology, are potentially threatened by the loss of a domestic telecommunications industry. Without a continuing focus on telecommunications R&D, the United States will increasingly be forced to purchase telecommunications technology and services from foreign sources. Risks include (1) U.S. dependence on foreign sources of technology to meet critical defense needs; (2) loss of exclusive or early access to state-of-the-art communications technology; (3) loss of know-how to employ state-of-the-art technology; (4) opportunities for other nations to introduce security holes into equipment and networks; and (5) loss of technical capability for cyberdefense in such areas as cybersecurity, network assurance, and cryptography. Finding 3. Investment in telecommunications research yields major direct and indirect benefits. Finding 3.1. U.S. telecommunications research has yielded tremendous direct and indirect returns. Notable payoffs from U.S. investment in telecommunications research and related areas in recent decades include the following: The Internet, which realized a new communications paradigm, introduced a new, highly flexible network architecture and protocols, and ultimately enabled myriad new applications and services; Radio-frequency communications technologies for cellular systems and wireless local area networks, which have enabled modern mobile voice and data communications; Optical networks, which have revolutionized communications by providing extraordinary communications bandwidths at very low unit cost; and Voice over IP (VoIP), which provides voice communications with enhanced flexibility and efficiency and has provided opportunities for innovation in applications beyond those provided by the public switched network. Additional examples are provided in Chapter 3.

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Renewing U.S. Telecommunications Research Finding 3.2. There are many promising avenues for telecommunications research, and renewed U.S. investment would yield major dividends, as indicated by the following possible results: An enhanced Internet architecture that goes beyond incremental improvements to deliver capabilities such as greater trustworthiness in the network core and in customer networks, improved addressing and routing, and end-to-end quality-of-service provisioning;1 More trustworthy networks that can better cope with the rising frequency, sophistication, and severity of attacks and the complexities and interdependencies associated with the convergence of voice and data networks; Telepresence and telecollaboration environments that reproduce at a distance a local space with the fidelity needed to allow people to work in concert; Public safety networks that offer greater mobility, interoperability, adaptability to harsh and changing conditions, and increased resiliency to damage; and Adaptive and cognitive wireless networks that enable higher-performance communications and more efficient use of radio spectrum, allowing them to provide capabilities that rival and complement those associated with wired networks. Additional examples are provided in Chapter 3. As in the past, the biggest payoffs may well come from unanticipated breakthroughs achieved in the course of pursuing such challenging problems. Finding 3.3. Telecommunications research carried out on behalf of the telecommunications industry can have a powerful payoff for all members of the industry. Because the value of a network grows with the number of its users, network operators will seek to make their networks interoperable with those of other operators. Interoperation requires some degree of common technology, which means that many network innovations cannot be appropriated by a single player. Finding 4. Over the past two decades, U.S. telecommunications research has been adversely affected by the level of research investment and the decreasing time horizon of research. The erosion of telecommunications research in industry mirrors, to a certain extent, broad cutbacks in U.S. industry R&D in general. The impact has been significant, underscoring the historical importance of industry research and mirroring the rapidity of the telecommunications sector’s restructuring following divestiture in 1984. The problems were obscured during the time of the Internet bubble, which saw a surge of telecommunications-related investment, but became quite apparent when the bubble’s bursting led to a dramatic decrease in telecommunications research investments in 2001 and beyond. Finding 4.1. Historically, the Bell System played a leading role in long-term, fundamental telecommunications research in the United States. The Bell System maintained a large research program and talent pool and ensured a flow of ideas and innovation across disciplines and among the research, business, and operational divisions of AT&T. It supported an infrastructure that nurtured successive advances in the 1 For a recent overview, see David Talbot, “The Internet Is Broken,” Technology Review, 108(11):62-69, December 2005-January 2006, available online at <http://www.technologyreview.com/infotech/wtr_16051,258,p1.html>.

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Renewing U.S. Telecommunications Research development chain from device fabrication to systems design to implementation and operation. It also provided a nucleus for the telecommunications research community. Because of the Bell System’s historical ability to conduct so much research in-house, however, the federal government did not emphasize support for academic research in telecommunications or otherwise encourage academia to address problems important to the telecommunications industry. University researchers themselves tended to concentrate on research areas more amenable to work by individual investigators or small research groups, such as semiconductors, communications theory, and signal processing, leaving to industry research related to the design and operation of large-scale communications networks. Notable exceptions, such as computer networking research supported by the Defense Advanced Research Projects Agency (DARPA) and NSF (which led to the Internet), illustrate the enormous potential payoff from government-supported and university-based research on new architectural ideas. Finding 4.2. In the wake of divestiture in 1984 and industry restructuring that followed, industry support for telecommunications research has declined and has also become less stable and more incremental and short-term in outlook. The U.S. telecommunications industry’s transformation reflects both the series of breakups of the Bell System (divestiture and subsequent reorganization and spin-offs) and the entry of new, non-vertically-integrated telecommunications firms such as cable system operators, Internet service providers, and wireless carriers.2 At the same time, new, often Internet-focused companies have also introduced products and services that help account for the broadening scope of telecommunications referred to in Finding 1. Some had hoped that the former Bell constituents (Lucent Bell Labs, Bellcore, and AT&T Research) could sustain a high level of long-term, fundamental research investments, but this proved impossible given the profound changes occurring in the industry. The telephone companies, facing growing competition, all but eliminated long-term, fundamental research programs, leaving responsibility for technological innovation to their equipment vendors. New telecommunications operators in cable, wireless, and digital subscriber line (DSL) services, lacking dominance and a high-margin foundation, generally adopted the same approach. The cable industry launched its own cooperative research and development activity, CableLabs, which focuses on such matters as standards development and conformance testing and does not support a broad, long-term research program. An important drawback of the vendor-based research paradigm is that it is much more susceptible to economic cycles than is carrier-based research support, because vendor revenues are linked to the rate of carrier capital expenditure, which has tended to fluctuate and then fell sharply in recent years, rather than to subscriber fees, which tend to be more stable. It is notoriously difficult to compile definitive data on support for industry research and development, but the situation described in testimony to the committee is clear—industry support for telecommunications research has decreased (as measured in dollars, numbers of researchers, and publications), and the work that is funded now has become increasingly 2 Recently, there have been several mergers between what were historically local exchange carriers and interexchange carriers, leading to greater vertical integration—but not integration between service providers and equipment vendors.

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Renewing U.S. Telecommunications Research short-term in focus—evolutionary rather than revolutionary—at a time when global competitors of the United States have placed a priority on long-term research in this area. Anecdotal reports indicate that basic research scientists in industry are being shifted to development work and that publication by industry researchers in telecommunications journals has decreased. Finding 4.3. In many critical technology areas, industry can look to the federal government to help support fundamental long-term research. Despite the decline in funding for research following the restructuring of the Bell System, however, the federal government did not assume this traditional funding role for telecommunications, thus contributing to the current gap in support for long-term telecommunications research. With industry having played such a large role in U.S. telecommunications research before divestiture in 1984, the federal government’s research investment in telecommunications was understandably small compared with its investment in other areas of information technology or in other industrial sectors. Long-term concerns similar to those now faced in the telecommunications sector prompted the establishment of research organizations for the semiconductor and power industries, with the implicit or explicit participation of government. Indeed, the current situation in telecommunications is somewhat analogous to the crisis faced by the U.S. semiconductor industry in the 1980s, when international competition and decreased R&D funding threatened that industry’s long-term viability. In response, the Semiconductor Research Corporation and SEMATECH were formed. Their work is widely credited with having played an important role in the recovery, renewed leadership, and long-term viability of the U.S. semiconductor industry (more information on SEMATECH and related efforts can be found in Chapter 2). Notably, there have been no parallel systematic efforts—either government- or industry-led—for telecommunications. Finding 5. In today’s telecommunications landscape, major architectural innovation is difficult to achieve. The greater difficulty today in achieving architectural innovation involves several factors. Multiple visions are now being pursued by various segments of the telecommunications industry, and although an increased diversity of players provides more fertile ground for new ideas, it also makes widespread deployment of good ideas more difficult. Moreover, no single entity is able to appropriate the results of long-term, fundamental research or to comprehensively address the engineering and standardization issues associated with end-to-end solutions that must span multiple service providers and multiple sectors of the industry. The research that can be conducted by a single vendor or sector is less well positioned to tackle end-to-end issues, and the need to coordinate decisions among a multitude of players greatly complicates achieving major new architectural advances. As a result, vendors tend to favor incremental improvements to today’s networks over more fundamental and high-risk research that seeks major advances in new or enhanced end-to-end applications and services and the architectural innovation that supports them. Finding 6. The roles of NSF (the largest overall federal sponsor of information and communications technology research) and DARPA (a traditionally important sponsor of telecommunications research) have been evolving, with implications for telecommunications research.

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Renewing U.S. Telecommunications Research Finding 6.1. Long a supporter of networking research and network deployment, NSF is moving toward a more strategic emphasis on telecommunications research. Although NSF’s Computer and Information Science and Engineering (CISE) directorate has long supported a networking research program, its Engineering (ENG) directorate supports research in such areas as wireless communications, and several of its engineering research centers have addressed telecommunications, these efforts have not reflected a comprehensive, coordinated research strategy. Modest funding for telecommunications programs has also been accompanied by a reportedly small and shrinking proposal acceptance rate. The creation in 2004 of CISE’s Network Technology and Systems (NeTS) program, however, represents an increased emphasis on telecommunications research at NSF. The new program spans a wide range of research topics in the control, deployment, and management of future networks and provides a framework for interdisciplinary work. Still in development as of this writing, the new Global Environment for Networking Investigations (GENI)—aimed at the exploration of new architectural ideas in experimental facilities that allow investigation at large scale—would represent a major initiative in this area. Finding 6.2. DARPA’s support for telecommunications research is now focused more on meeting specialized military needs than on stimulating broader technology advances of use for both commercial and military purposes. DARPA-sponsored research has led to many significant telecommunications advances in such areas as packet-switched networking, development of ARPANET and the Internet, optical communications, and ad hoc radio networks, as well as to the establishment of successful U.S. telecommunications companies that are now global leaders, including Broadcom, Rambus, and Aetheros. In addition, DARPA has historically played an important role in promulgating visions that stimulated commercial development and adoption of new technologies, as well as in building communities of researchers. In recent years, the focus of DARPA research has shifted toward more immediate or specialized military needs. Putting aside the debate about the extent to which the military’s research portfolio should concentrate on the short term versus the long term, a consequence is the loss of an important source of support for longer-term telecommunications research. RECOMMENDATIONS The recommendations below lay out steps that the United States should take to develop and sustain a multifaceted, reinvigorated telecommunications research program. The recommendations envision a greater role for government-sponsored and university research in telecommunications than has been evident in the past and also envision additional investment by industry in more work of a fundamentally high-risk character with more attention to overall architectural issues. The recommendations are all aimed at so-called precompetitive activities; when the time arrives for development, implementation, and deployment, it will be up to equipment and software suppliers to create and manufacture the products and to service providers to deploy the necessary facilities and services. Determining how much funding to provide for such a telecommunications research initiative involves, of course, a complex set of budgetary tradeoffs among research programs and between research and non-research activities. The committee does not make a recommenda-

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Renewing U.S. Telecommunications Research tion for a specific funding level but notes that funding should be consistent with the vital role played by telecommunications in the U.S. economy and society and with the direct contributions made by the U.S. telecommunications industry to the nation’s economy and security. Funding should also be consistent with telecommunications’ role as a critical element of information technology (some 16 percent of the total federal networking and information technology research and development budget today goes to telecommunications; see Chapter 2). Finally, the investment should be large enough to support a critical mass of researchers and research; one estimate can be drawn from the predivestiture Bell Labs, whose budget of over $500 million (in today’s dollars) for basic research was sized to provide the breadth and depth to comprehensively address telecommunications research issues. Recommendation 1. The federal government should establish a new research organization—the Advanced Telecommunications Research Activity—to rejuvenate fundamental and applied telecommunications research in the United States and to stimulate and coordinate activities across industry, academia, and government that can translate research results into deployments of significant new telecommunications capabilities. In light of the findings presented above, the committee believes that a new national research organization, which it dubs the Advanced Telecommunications Research Activity (ATRA), should be established by the federal government. This recommendation is inspired in large part by the enormous leaps in telecommunications technology historically attributable to DARPA and Bell Labs and the success of broad industry consortia such as SEMATECH. Recommendation 1 and Recommendation 2 below both contemplate significant federal support for telecommunications research. However, their full effects will come only with the participation of both service providers and equipment vendors. ATRA would provide (1) a forum for convening federal research sponsors, academic researchers, and industry to identify research that is relevant to industry’s most critical needs and (2) a mechanism for the telecommunications industry to pool funds to conduct precompetitive research. Government matching funds would provide an additional incentive for industry participation. In terms of structure, the committee considered the pros and cons of different models (described in Chapter 4) and decided that a hybrid approach is best suited to the challenges facing the telecommunications industry. The committee envisions ATRA as a hybrid of activities of the sort historically associated with DARPA (which through the ARPANET program managed a research portfolio, developed a vision, and convened industry and academia) and SEMATECH (which brought a struggling high-tech sector together, initially with some federal support to complement industry dollars, to fund joint research, development, and roadmapping activities). ATRA would be staffed by program managers who would include researchers from both academia and industry. Industry funding would represent a significant fraction of total ATRA funding, and industry as well as academic researchers would be deeply involved in research activities. There are a number of options for where within the federal government such a program could fit, each with its own set of tradeoffs (see Chapter 4). The committee does not make a specific recommendation for locating such a program but notes that ATRA’s proposed mission would align with that of existing agencies within the Department of Commerce and that NSF has developed mechanisms for joint academic-industry engineering research, albeit more focused and on a smaller scale.

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Renewing U.S. Telecommunications Research ATRA’s multifaceted mission would include the following (see Chapter 4 for more discussion of the items below): Identifying, coordinating, and funding telecommunications research for the nation. ATRA’s focus would be on critical telecommunications research in which the nation is currently underinvesting. Fostering the conception, development, and implementation of major architectural advances. ATRA would place a priority on research that aims to make possible major architectural advances that result in the development of dramatically new telecommunications capabilities (such as the Internet was when it was developed) rather than incremental improvements to existing capabilities. Strengthening the nation’s telecommunications research capacity by building up research groups, centers, and institutions with sufficient scale and breadth of expertise to tackle real-world problems and by strengthening connections between the industry and academic communities and among the telecommunications, semiconductor, and computer segments of the IT industry. To provide major experimental facilities useful to but beyond the capabilities of individual university research groups or firms, ATRA would consider establishing and supporting an experimental infrastructure for such activities as fabrication, prototyping, and testing. Roadmapping (see Chapter 4) would be a useful tool for (1) establishing research priorities, (2) identifying complementary investments and actions required to realize major advances, and (3) examining the interplay between technical, business, and policy considerations. ATRA could serve as both a neutral convener and a partial source of funding for such activities, perhaps learning from the role played by SEMATECH with respect to the International Technology Roadmap for Semiconductors (ITRS)—see Chapter 4 for a discussion of both SEMATECH and ITRS. Long-term investments are required to realize the sorts of innovation contemplated in connection with ATRA. It would likely take at least 5 years to develop a major advance (such as a superior replacement architecture for the Internet) and several more years to see that design reflected in products and services in the market. But history shows that a well-conceived research program yields numerous payoffs, including shorter-term advances and unforeseen long-term benefits. The following are suggestions for specific steps to be considered in implementing the committee’s first recommendation. Establish mechanisms for carrying out project-based research involving academia and industry and build up a core technical staff to manage research projects and coordinate activities. Mechanisms such as broad agency announcements would allow ATRA to solicit promising ideas from academia and industry. These ideas would be used to jump-start a research program, help establish a critical mass of researchers, and garner sufficient industry matching funding to allow the establishment of research centers that can attract significant industry participation—organizations along the lines of the NSF-supported engineering research centers that are described in Chapter 4. ATRA would provide leadership by setting overall goals and objectives but should foster

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Renewing U.S. Telecommunications Research a diversity of ideas and a robust competition in ideas among rival research groups. Universities should receive a significant portion of funding to conduct unfettered research while educating future generations of U.S. researchers. However, ATRA should also address industry interests by providing support for industry to collaborate with universities. By allocating funding to both universities and corporations, ATRA would help achieve the critical goal of connecting the key components for future success. Establish advisory committees that include significant, high-level industry participation. Advisory committees with representatives from equipment suppliers and service providers would help ensure that ATRA is responsive to industry needs. The participation of high-level executives is critical to both ensuring ATRA’s relevance and sustaining industry buy-in and support for ATRA activities. This requirement suggests the wisdom of creating an executive council that includes chief executives of equipment and software suppliers and service providers along with representatives from federal agencies concerned with telecommunications and telecommunications research (e.g., DARPA, the National Institute of Standards and Technology (NIST), the National Telecommunications and Information Administration (NTIA), NSF, and the Federal Communications Commission). Additional advisory committees might be established to address individual major technology areas (e.g., optical and wireless communications or network security) or the interplay between technology and regulatory developments. Explore future needs for R&D centers and shared facilities to complement distributed, project-based research. There are a number of research problems whose investigation might ultimately require centers or shared facilities. For example, characterizing and improving the security and reliability of a large-scale communications network, especially when it comprises multiple interconnected service providers that use diverse technologies, requires a much broader perspective than can be brought by any individual or group of individuals. Centers may also be a way to more efficiently provide certain experimental facilities—such as for fabrication, prototyping, and testing. For example, research that depends on fabrication of integrated circuits or other devices may require access to facilities that are beyond the reach of a university-based research group. Finally, centers provide a nucleus for academic-industry collaboration and for interdisciplinary research. There are several plausible options for establishing R&D centers: establishing university-based centers in which industry participates, extending the mission and size of a government laboratory such as those at NIST, or establishing a federally funded research and development center for telecommunications research. Selecting the appropriate types and mix of institutions would be an important task for ATRA and would depend on industry interests and institutional capabilities. Research priorities that emerge from vision-setting and roadmapping activities would also help inform the design of such centers. Establish a forum in which lawmakers, regulators, research funding agencies, and industry can share knowledge about technological developments, visions and roadmaps, and policy and regulation. To maximize the leverage of establishing ATRA and increasing industry participation in R&D, it is essential that lawmakers and regulators understand the impact of legislation and rule-making on the R&D enterprise, and that both they and researchers consider and reflect in their thinking the interplay between the policy environment, business opportunities, and technological directions.

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Renewing U.S. Telecommunications Research Recommendation 2. The National Science Foundation and DARPA should assess their investment in basic telecommunications research and consider increasing both their emphasis on and their level of investment in such research. Even with the creation of ATRA, both NSF and DARPA will retain important roles in strengthening U.S. telecommunication research. Both have successful research management cultures that complement each other and the activities envisioned for ATRA. In particular, both have been very effective at identifying, building up, and supporting research communities in areas of national interest. As a starting point and as a periodic activity, both NSF and DARPA should look across their programs to determine how much funding is actually being directed to telecommunications research and should then develop criteria for establishing the appropriate level of funding going forward. Relevant criteria include (1) the size of the telecommunications research community and the number of highly rated proposals that can be funded, (2) the size of the telecommunications industry’s R&D budget, and (3) provision of support for telecommunications research within the broader IT research budget in proportion to the size of the telecommunications segment compared with the size of the IT industry as a whole. Recommendation 2.1. The National Science Foundation should continue to strengthen its support for telecommunications research. NSF has significant strengths in supporting basic research, training researchers, and building research communities that can play an important role in strengthening the U.S. research base in telecommunications. CISE’s growing commitment to supporting research in this area is evident, and the committee encourages NSF to sustain such attention. In addition, and reflecting the greater emphasis being placed in this program area, NSF should also consider establishing programs aimed specifically at attracting and developing young research talent in telecommunications. Options would include supporting graduate and postdoctoral fellowships in telecommunications or establishing a young-investigator program that would provide start-up support for promising research talent, targeted at telecommunications. Finally, existing mechanisms such as the CISE Advisory Committee or new ones, such as formal or informal consultations with the director of the proposed ATRA, should be used to keep abreast of new ideas, major challenges, and promising research directions emerging from academia and industry. Recommendation 2.2. DARPA should continue to invest in telecommunications research for military applications even if there is some chance that the commercial sector will develop such technologies. In light of the importance of maintaining a cutting-edge telecommunications capability in a network-centric military, DARPA should periodically reexamine its investments in telecommunications. Factors to consider include (1) the telecommunications capabilities attainable by potential U.S. adversaries by virtue of the burgeoning commercial telecommunications sector overseas and (2) the risks associated with having to rely on components and systems that are increasingly being developed overseas. DARPA’s role would be complementary to that of NSF and the proposed ATRA. Compared to NSF, for example, DARPA has a culture of focused programs with more active management and significant industry participation.

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Renewing U.S. Telecommunications Research Recommendation 3. All segments of the U.S. telecommunications industry should increase their support for additional fundamental research. One avenue would be through participation in joint, cooperative research activities organized by the proposed ATRA. As described above, the emphasis of industry research in recent years has shifted toward short-term product opportunities within the context of existing overall network architectures and away from the more fundamental and high-risk opportunities and major advances in cross-cutting end-to-end applications and services and supporting architectures that are essential to the long-term health of the U.S. telecommunications sector. Both equipment vendors and service providers (including providers of wireline telephony, wireless, broadband, Internet, satellite, and cable) should consider identifying and using mechanisms through which they could provide more support for fundamental research. ATRA, proposed in Recommendation 1, is intended to provide a way for the telecommunications industry to pool funds, spread risk, and share beneficial results through cooperative efforts between industry and academia that are jointly funded by industry and government.