Despite shifts in its research and funding focus, the Defense Advanced Research Projects Agency (DARPA) still plays a key role in U.S. IT innovation, said Erica Fuchs, assistant professor in the Department of Engineering and Public Policy at Carnegie Mellon University. Once, DARPA emphasized high- risk, high-reward and open-ended funding of universities, but after a decade of technological change it now aims its funds at vendors, Fuchs told a Tuesday Information Technology and Innovation Foundation forum. During 2001-2004, funding of universities shrank to 21 percent from 39 percent of DARPA’s total program, according to the Senate Armed Services Committee. Similarly, U.S. research and development funding has moved from large corporate labs to venture-funded small and mid-sized enterprises, she said. ITIF President Robert Atkinson said the U.S. innovation system has moved away from vertically integrated firms with big labs to networked firms linking interdependent technologies. A 50-year-old Department of Defense entity responsible for bringing the military new tools, DARPA adopted new methods to seed and encourage “new technology trajectories,” Fuchs said. The recast DARPA has a key role in coordinating “commercialization of research” across universities, start- ups and contractors, she said.

Free Press asked the FCC to make universal, affordable broadband “a priority” as it revamps Universal Service Fund and Intercarrier compensation rules, most likely at the Nov. 4 meeting. “The current systems of intercarrier compensation and universal service subsidies are inefficient and tied to yesterday’s technology. Reform is inevitable, but it must be done properly,” said Ben Scott, Free Press policy director. “We need bold FCC action to cut through the self-interested rhetoric of industry proposals from both sides to find the right solution for consumers.” Free Press said in a Monday letter to the FCC that consumers inevitably will pay more for phone service -- rates that the FCC must justify. “Having made this case, the Commission must treat this need to reform ICC as an opportunity to modernize the outdated universal service system,” the group said. “The Commission must ensure that as a result of the changes to ICC, that the short-term ‘pain’ of reform will be followed by long-term consumer benefits in the form of universal affordable broadband.”

Despite shifts in its research and funding focus, the Defense Advanced Research Projects Agency (DARPA) still plays a key role in U.S. IT innovation, said Erica Fuchs, assistant professor in the Department of Engineering and Public Policy at Carnegie Mellon University. Once, DARPA emphasized high- risk, high-reward and open-ended funding of universities, but after a decade of technological change it now aims its funds at vendors, Fuchs told a Tuesday Information Technology and Innovation Foundation forum. During 2001-2004, funding of universities shrank to 21 percent from 39 percent of DARPA’s total program, according to the Senate Armed Services Committee. Similarly, U.S. research and development funding has moved from large corporate labs to venture-funded small and mid-sized enterprises, she said. ITIF President Robert Atkinson said the U.S. innovation system has moved away from vertically integrated firms with big labs to networked firms linking interdependent technologies. A 50-year-old Department of Defense entity responsible for bringing the military new tools, DARPA adopted new methods to seed and encourage “new technology trajectories,” Fuchs said. The recast DARPA has a key role in coordinating “commercialization of research” across universities, start- ups and contractors, she said.

The FCC’s October meeting has been changed for at least a third time as Chairman Kevin Martin failed to get any other commissioner to support a DTV-related notice that drew internal controversy (CD Oct 8 p6). No items will be voted on Wednesday, at what was to have been a regular monthly meeting in Nashville, agency officials said. Instead, four FCC members will gather at Vanderbilt University’s medical center Wednesday morning for an en banc hearing on obesity, while Commissioner Michael Copps will participate by phone, agency officials said.

Californians commenting on the future of the state’s Lifeline program urged the Public Utilities Commission to think carefully before allowing a Lifeline rate increase as of Jan. 1, and to take care in making any other changes to the Lifeline program. As part of a September order approving basic exchange rate increases for the state’s largest incumbent telcos, the PUC approved a Lifeline rate increase of 81 cents monthly, effective Jan. 1, seeking comment on whether it should minimize rate shock for Lifeline customers and on how the rise might affect Lifeline service affordability (Case R-06-05-028). Large incumbents supported the increase while consumer advocates urged freezing Lifeline rates at present levels. AT&T said record evidence indicated Lifeline rates could rise more than 81 cents without undue harm to low-income households. It also said the Lifeline program should become a fixed benefit program in which eligible customers get the same amount of subsidy regardless of a carrier’s local rates. It said this approach would ensure competitive neutrality. Verizon backed larger Lifeline increases, provided they were phased in over two years. Verizon suggested an affordability study and that the PUC address program expansion issues. AT&T and SureWest urged disconnecting existing ties between Lifeline rates and AT&T’s basic local rates since AT&T faces competition that drives its pricing. Sprint Nextel and T-Mobile said the PUC should allow wireless carriers to receive state Lifeline subsidies to expand consumer choice and be technologically neutral. But consumer group TURN opposed expanding the Lifeline carrier roster until the PUC studies the effects on the Lifeline program and its surcharges. TURN urged the PUC to be “extremely careful” in revamping Lifeline in light of how it says telecom deregulation has turned out in the state. The state Division of Ratepayer Advocate also called for caution in making changes. It urged a Lifeline rate freeze until the PUC gauges how changes affect fund size, fund surcharges and overall universal service policy.

The Indiana Utility Regulatory Commission refused to reconsider an August order requiring Cincinnati Bell to recover its payments to the state universal service fund through a line-item surcharge on customer phone bills. The telco sought a waiver of the pass-through billing rule on ground that its costs to alter its billing system for Indiana accounts would significantly exceed its annual liability to the state fund. It offered to pay its universal service liability from general revenue. The URC (Case 43476) reaffirmed its earlier order that a statewide agreement settling state universal service fund disputes, binding on all local exchange providers, required that fund contributions be passed along to customers in bills and provided for no exceptions. It said Cincinnati Bell was merely rehashing unsuccessful arguments it made in the original hearings.

Odds are increasingly slim of comprehensive overhaul of FCC intercarrier compensation rules or the Universal Service Fund this year or before Kevin Martin’s chairmanship ends, officials said. Intercarrier compensation issues are teed up for the Nov. 4 meeting, but FCC officials said they have seen nothing from the chairman’s office or the Wireline Bureau about what the chairman may envision. And most commissioners will be on travel the week of Oct. 20, complicating any discussions leading up to the meeting. An FCC official didn’t comment.

The FCC should test a broadband Lifeline and Link Up universal service program to bring broadband to low-income communities, TracFone Wireless said. In a petition filed Thursday, the carrier said broadband remains financially “beyond the reach of all too many low income households.” The fund would help bridge the digital divide, it said, citing Pew data showing that though 67 percent of homes with $50,000 to $75,000 annual incomes have broadband, only 25 percent of households making less than $20,000 do. TracFone recommended a limited trial in Florida, Virginia, Tennessee and Washington, D.C. “Based upon how the program is implemented in those jurisdictions and what is learned during the trial, the Broadband Lifeline/Link Up program could be introduced on a national basis,” it said. Under Link Up, which supplies gear, providers would get a subsidy of $250 a PC or wireless handheld device, TracFone said. From the Lifeline side, each household would get $30 monthly toward Internet service, it said. The money “would be separate from and in addition to their monthly Lifeline support for voice telephone service,” it added. Wireline providers would have to provide broadband speeds at least equivalent to DSL’s, and wireless would have to provide 3G speeds, it said.

The FCC should test a broadband Lifeline and Link Up universal service program to bring broadband to low-income communities, TracFone Wireless said. In a petition filed Thursday, the carrier said broadband remains financially “beyond the reach of all too many low income households.” The fund would help bridge the digital divide, it said, citing Pew data showing that though 67 percent of homes with $50,000 to $75,000 annual incomes have broadband, only 25 percent of households making less than $20,000 do. TracFone recommended a limited trial in Florida, Virginia, Tennessee and Washington, D.C. “Based upon how the program is implemented in those jurisdictions and what is learned during the trial, the Broadband Lifeline/Link Up program could be introduced on a national basis,” it said. Under Link Up, which supplies gear, providers would get a subsidy of $250 a PC or wireless handheld device, TracFone said. From the Lifeline side, each household would get $30 monthly toward Internet service, it said. The money “would be separate from and in addition to their monthly Lifeline support for voice telephone service,” it added. Wireline providers would have to provide broadband speeds at least equivalent to DSL’s, and wireless would have to provide 3G speeds, it said.

Developer MindFuse secured $1 million in convertible note funding from Keiretsu Forum angel investors for the creation of massively multiplayer online games and virtual worlds, MindFuse said Tuesday. The money will be used for working capital, “expanding the core” development team based in Berkeley, Calif., and development of a strong customer service and marketing organization, it said. The company has raised a total of $1.75 million since inception in 2006, it said. MindFuse is out to combine elements of massively multiplayer universes and casual games, said CEO Joseph Walters. He noted MMOs traditionally have been “violent fantasy worlds,” while casual games tend to “feel more like a snack than a feast.” MindFuse’s goal is to “bring the two types of gameplay and players together” to create “simple, compelling games embedded” in a 3-D world, Walters said. The first game developed by MindFuse will be announced “shortly, with a public beta” planned for spring, it said.