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The technologies used for telecommunications have changed greatly over the last 50 years. Empowered by research into semiconductors and digital electronics in the telecommunications industry, analog representations of voice, images, and video have been supplanted by digital representations. The biggest consequence has been that all types of media can be represented in the same basic form (i.e., as a stream of bits) and therefore handled uniformly within a common infrastructure (most commonly as Internet Protocol, or IP, data streams). Subsequently, circuit switching was supplemented by, and will likely ultimately be supplanted by, packet switching. For example, telephony is now routinely carried at various places in the network by the Internet (using VoIP) and cable networks. Just as the PSTN is within the scope of telecommunications, so also is an Internet or cable TV network carrying a direct substitute telephony application.

Even with ATRA, NSF and DARPA will remain important contributors to U.S. telecommunications research efforts. The committee recommends that NSF and DARPA assess their investments in basic telecommunications research and consider increasing both their emphasis on and their level of investment in such research. Both should establish criteria for determining the appropriate level of telecommunications research funding. NSF should continue to strengthen its support for telecommunications research and should consider programs for attracting and developing young research talent. To stay at the forefront, DARPA should continue support of telecommunications research for military applications, even if there is the chance of commercial development of those technologies. In formulating its research programs, DARPA should also consider the telecommunications capabilities of potential adversaries and the risk of dependence on foreign suppliers for key technologies.
How are the new networks different? First, they are integrated, meaning that all media— be they voice, audio, video, or data—are increasingly communicated over a single common network. This integration offers economies of scope and scale in both capital expenditures and operational costs, and also allows different media to be mixed within common applications. As a result, both technology suppliers and service providers are increasingly in the business of providing telecommunications in all media simultaneously rather than specializing in a particular type such as voice, video, or data.

Second, the networks are built in layers, from the physical layer, which is concerned with the mechanical, electrical and optical, and functional and procedural means for managing network connections to the data, network, and transport layers, which are concerned with transferring data, routing data across networks between addresses, and ensuring end-to-end

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