And would it have grown into more than that? Into something that everyone, and not just military and scientists can use?
It did though? I don’t know what point you think you’re making but the internet did in fact grow from a technology limited to universities and the armed forces to a publicly accessible network, mostly off the back of publicly funded researchers and various techies that started their own neighborhood ISPs.
Why not?
Sorry I just don’t buy into the ideology that the free market has this kind of “magic sauce” that makes everything innovative and better.
The early Internet was filled of people doing all kinds of cool things for free just because it was interesting to do, the only thing the private sector did is provide the base infrastructure, this is something the state can easily do too. All kinds of communities, FOSS software and media popped up and none of them had VC funding or expected any money out of it.
It was only in mid-late 2000 that capital really sank its teeth into the Internet properly.