Obama/Gates plan to Change the US Military Takes its First Steps

Gates Budget Plan Reshapes Pentagon’s Priorities - NYTimes.com

This really represents a continuation of some of Donald Rumsfeld's policies. In recent years several other largish military systems have been canceled when their outlandish costs have exceeded their likely modest benefits. The XM-2001 Crusader self-propelled howitzer (11 billion $) was cancelled in 2002, the RAH-66 Comanche (~24 billion $) was cancelled in 2004, and the DDG-1000 Zumwalt (6 billion per ship x 30+ ships) appears to be dead in the water as well.
The writing appeared to be on the wall for the FCS years ago and Gates' budget plan seems to formalize what most of us (who care to know about such things) already knew. FCS was a bloated program which would have given the US Army under-armored combat vehicles which were over-reliant upon not-yet invented technology at a seriously high cost without adding capabilities to offset the negatives.
If nothing else, the Iran/Iraq adventures have shown what military weapons systems work well in combat and which don't. That is, in a war against an enemy with vastly inferior firepower, horrible training, nonexistent air power, and poor logistical support. How American doctrine and equipment would fare against Chinese, Russian, or North Korean forces is another question entirely that I can't answer conclusively.
Hopefully what this means is that DOD procurement procedures will become somewhat more rooted in the reality-based world the rest of us live in.