but also to develop solutions to the problems posed by large-scale systems and social applications of IT. The committee views components, systems, and applications as three equally important areas for research, noting that they play roles in IT analogous to the roles of biomedical research, physiology, and medicine in the health sciences. Each area informs work in the others, and fundamental scientific understanding is needed in all three areas to ensure a properly functioning system.

As noted above, the government is the primary vehicle for support of fundamental IT research. Although industry funds a considerable amount of research (some of which is fundamental research) in its own laboratories and in universities, intense competitive pressures and the need to generate positive returns for investors force companies to direct more of their R&D funding to projects with more certain results and more obvious applicability to market needs. The potential social return on investments in research is enormous, but these investments will not be made without the government's lead.

It is not feasible to specify a precise dollar amount by which IT research funding should increase, but the increases recommended by the President's Information Technology Advisory Committee (PITAC) and requested by the Clinton Administration for fiscal years 2000 and 2001 are representative of the magnitude of the annual increases needed for some time to come (PITAC, 1999). Government program managers report that they receive far more high-quality research proposals than they can fund (a situation that is common in other fields, too). How the money is spent is at least as important as the amount. Researchers in the field observed, in testimony to the committee and in other contexts, that the allocation of federal funding shows less vision and more emphasis on process than it did in the middle of the twentieth century. The historic comparison is important, because there is a correlation between the approach to funding management and the yield. Today's circumstances demand a more visionary, less process-bound approach, as will be discussed below, because the needs of large-scale systems and social applications can be met only with innovative, revolutionary work. The Defense Advanced Research Projects Agency (DARPA), in particular, has a history of supporting revolutionary work, and this orientation should be reinforced and encouraged.

Recommendation 2. The National Science Foundation and the Defense Advanced Research Projects Agency should establish significant programs of fundamental research in large-scale information technology systems.

Large-scale IT systems pose difficult technical (and nontechnical) problems that are manifested in a variety of ways: delays in designing



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