in the United States.1 Rather than discuss the history of the computing industry, Dr. Flamm said he would focus on current trends in federal funding for R&D in the computer industry. In light of recent changes in funding levels, as well as the growing importance of information technologies in the economy, updating his data may contribute to this conference’s deliberations, as well as the broader policy debate.

Evolution of the Computer

To set the stage for his discussion of data trends, Dr. Flamm touched on a few topics from the computer industry’s history. Unlike the semiconductor industry, nearly all computer development in the immediate postwar era enjoyed significant federal support. It was not only that government served as the market for computers, but the government also provided substantial funding for computer development. From 1955 to 1965, the commercial market for computers grew rapidly, although the government continued to fund most high-performance computing projects and government-funded computer development projects served to push the leading edge of technology. In the 1965 to 1975 period, the growth of the commercial market for computers accelerated even more, and the government role centered primarily on funding the very high end of computer technology development. During the next fifteen years, from 1975 to 1990, commercial markets grew far larger than government markets and pushed the preponderance of technology development. However, government played an important niche role in funding what might be called “the exotic leading edge” of computer technology development. The period from 1990 to 1997 is marked by some surprising, and in some ways disturbing, trends in computer R&D.

Before turning to describing these trends, Dr. Flamm made an observation about the role of cryptography in the invention of the computer. The ENIAC computer at the University of Pennsylvania is generally credited as being the first electronic computer ever built. However, Dr. Flamm said that a case can be made that the first electronic stored-program digital computer was built in England in 1943 and used by the cryptographic community to break German codes.

In fact, the National Security Agency (NSA) in the United States and its antecedents were the chief funders of much of the advanced computer R&D in the 1950s and into the mid-1960s. The reason for NSA’s interest was cryptography, and indeed the cryptographic community continues to drive innovation in high-end computing as a way to make and break codes for national security purposes.


Kenneth Flamm, Targeting the Computer: Government Support and International Competition, Washington, D.C.: The Brookings Institution, 1987; and Kenneth Flamm, Creating the Computer: Government, Industry, and High Technology, Washington, D.C.: The Brookings Institution, 1988.

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