According to an ARPA-sponsored history of the organization, IPTO grew from a distinctly unpromising beginning: the Air Force had a large, expensive computer (AN/FSQ 321A) which was intended as a backup for the SAGE air defense program, but no longer needed; and it also had too few required tasks to maintain the desired staffing level at its main software contractor, the System Development Corporation (SDC).
It was accordingly begun in June 1961 with an initial budget of $5.8 million, to include shipping, installation, and checking out the computer at SDC facilities.
Licklider started work in October 1962, and until his term ended in 1964, he "...initiated three of the most important developments in information technology: the creation of computer science departments at several major universities, time-sharing, and networking".
Licklider quickly set about detaching the program from its sole reliance on a surplus Air Force computer and single industrial contractor.
As he recalled:[6] Essentially what I did on the command and control thing was to try to figure out where the best academic computer centers were, and then go systematically about trying to get research contracts set up with them, aiming for three or four major ones and then a lot of little ones.