1 million times more powerful than those of 1980. The software capabilities have similar jumps, although these jumps are less apparent and not easy to measure.

Second, leadership in the market, as a producer or consumer, requires an active organizational role in defining the architecture of systems, and doing so as a first mover or fast follower. Software economics are focused on externalities—where the technical manifestation of the system structure is the software architecture and internal framework and component interfaces. This requires sustained technological leadership and clear thinking about the significance of architectural control. This is particularly significant in the definition and leadership of the design of the major ecosystems. Some of these are wholly controlled by commercial vendors, but others involve complex community processes.

Third, software technical challenges are broadening. These include, for example, software assurance, ultra-scale architecture, concurrency (multi-core and distributed), framework design, programming language improvements for assurance and scale, concepts for “big data” systems, and so on. These challenges are addressed in Chapters 2, 3, and 4 of this report.

Fourth, risk management models need to be continually adjusted to accommodate the new realities of software and of IT-enabled business practices, as noted above. This is the subject primarily of Chapters 2 and 4.

Finally, the role of software leadership in the global economy is growing, and this is increasingly recognized, with the result that global competition is becoming more intense at every level of capability. Overseas competition is greatly facilitated by the low barrier to entry—costly physical facilities are not needed in the software economy, but education and technical currency are fundamental and ongoing challenges. This is significant for the DoD, which has counted on U.S. industry, including defense contractors and their supply-chain participants, to sustain technological leadership in software as a key driver of capability leadership in systems. Such leadership must be maintained through constant investment in innovation and in people. At the highest level of technical sophistication, this requires investment in university research to produce a sufficient pipeline of technical leaders.46


U.S. PhD students in computer science and IT-related areas are almost universally supported with tuition and stipends covered by sponsored research. Universities rarely have funds to provide direct fellowships to PhD students in these areas, and few students have the resources or capacity to self-fund or to take on (often additional) loans to cover their costs.

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