About a year ago, an editorial in The Wall Street Journal caught my eye with a comment about "the Internet and other great technologies created by the free market." Now I've worked in private industry virtually all my life, and I'm as big a fan of the free market as anyone . . . but the author was wrong.The free market did not create the Internet. It was funded from its inception in 1969 through the early 1990s by a variety of government agencies and grants. Most notable among them was the National Science Foundation, which paid for not only the research and development but also the actual operation of the NSF backbone (to the tune of $10 million per year).For that reason, the Internet was off limits to commercial use: As a particle physics grad student in the 1980s, I remember signing an acceptable-use policy in which I promised not to transmit commercial traffic across the 'Net. Private industries were involved (MCI, Sprint, and Bolt Beranek and Newman, among them), but most individuals who worked on Internet-related technologies until about 1990 were paid with government research dollars.Why does it matter? It matters because I don't see any organization - whether government or private business - pouring that much money into pure research anymore. A few exceptions:\u00a0IBM\u00a0(which continues to heavily fund its\u00a0TJ Watson Labs),\u00a0Microsoft\u00a0and some of the larger service provider research labs, notably\u00a0AT&T\u00a0and\u00a0Verizon. But even in those examples, when you dig into the specifics, you'll find that researchers are encouraged to work on targeted research - solving the immediate problems of this year or next year, rather than building the underpinnings for technology innovation over the next decade.Again, why does it matter?Because the process of developing anything new, such as transformational technology, requires respite from the hurly-burly work-a-day world. You need the freedom to focus on what works, not what will make money. The only entities able to provide this freedom are the government and large, relatively stable companies.Now you're probably thinking, "What about all the\u00a0start-ups\u00a0that keep coming up with great technology?" Think about it: Most start-ups created their great technology somewhere else, then built a company to capitalize on it. That means some other company unwittingly footed the bill for the creation of a potentially competitive firm.That doesn't make sense. It's far better for a company to explicitly fund long-term research then retain a stake in its development and exploitation. IBM does this best right now. In\u00a0my last column\u00a0I mentioned that intellectual property creation was one of the great underutilized strengths of the service providers. Ma Bell could take a cue from Big Blue.On a separate note, kudos to Bruce Tolley at Cisco for reminding me that the Internet Engineering Task Force is not the only standards body driving network technology, as Scott Bradner and I agreed in\u00a0a previous column. The IEEE developed not only the original Ethernet, but also the wireless and Gigabit Ethernet specs that currently drive the market.