Transforming? You guys do know where google got it's start right? SV has been DOD funded from the start.
Microprocessors as a whole were a result of the US military industrial complex. The first large scale use of integrated circuits was the Minuteman II ballistic missile guidance system. The lineage that leads to the modern smartphone starts with Texas Instruments winning the contract for that military guidance system (first as a subcontractor to North American, then fully on their own).
Similarly, the first production use of a charge-coupled device for digital camera technology was the KH-11 spy satellite.
There isn't a shred of reality to support the notion that software is materially different than any other industry, and 'The Silicon Valley' starts with 'Silicon' - and then went through 'Hardware' - it wasn't software dominated until the 1990s.
I would go so far to say as Software is less involved than hardware.
Defence has almost always been a 'physical' industry and most defence contracts are for gadgets, not software.
Obviously - there's a ton of 'intelligence' going on that is software oriented, but they're generally not massive contracts, but bespoke stuff.
The NSA is not spending $100B on single procurement. They're relatively small.
(FYI - one middle sized defence program is bigger than CIA/FBI/NSA budgets)
Or what drove the demand for silicon in the first place.
As for "transforming", that happened some time during the Vietnam war when the laser-guided bomb was introduced. Been a smooth sailing ever since.
- google founders’ research was funded from federal grants.
- federal grant was administered by National Science Foundation (not DoD) with funding from DARPA (yes DoD) and NASA (not DoD?).
Google itself was fully funded by private investors, only the research was *partially DoD funded.
Funding some key technologies is not the same as 'funding the valley'.
Military related funding is probably less than a few % of the financing behind startups.
There are a few strategic foundations, but it's not a defence industry.
In 2015, I told my son I would disown him if he went to work for Facebook. Several years later, he told me he was doing a contracting gig for Meta, on a project that would "definitely never see the light of day". Given the amount of engineering time that was squandered in the early 2020's, I chose to believe him.