By Paul Reynolds
World affairs correspondent BBC News website
Some experts have doubts about the missile shield concept
The decision by the Obama administration to drop plans to base an anti-ballistic missile defence system in Poland and the Czech Republic is a huge shift in American foreign and defence policy.
There are several immediate implications.
First, it is a major signal, which has followed a number of others, that the United States is adopting a far more cautious and flexible foreign policy under President Obama than it did under President Bush.
President Bush was determined on the European-based system and agreements had been reached with Poland to base 10 anti-missile interceptors there and with the Czechs for them to house the system's radar.
President Obama ordered a review when he came into office. He has now been told that Iran is concentrating less on long-range ballistic missiles that might one day reach the United States and more on shorter range one that could reach parts of Europe.
This has given him a technological reason to change and he will use this to fend off criticism that he has given in to Moscow. He was careful to say that his military chiefs agreed with him.
Relations with Moscow
The second effect will be on US relations with Russia. Here the picture will be mixed. The Russians will be pleased and therefore relations will be eased. The Russians had claimed the system might be a threat to them, though the US said it would not. The US felt that the Russians were simply making an excuse to meddle in the affairs of their near neighbours.
But the Russians might also feel triumphant and conclude that their tough approach is one that brings respect and results.
The US might hope for spin-offs from more relaxed relations - in that the Russians might be more willing to agree to increased sanctions against Iran and might show greater flexibility in nuclear weapons and anti missile talks. But neither is certain.
The decision has drawn both praise and blame. Ted Galen Carpenter, head of defence and foreign policy studies at the Cato Institute in Washington said: "Not only was that system an over-reaction to a hypothetical Iranian nuclear and missile threat to Europe, but it had poisoned relations with Russia. This move is the first tangible manifestation of President Obama's stated objective to 'hit the re-set' button regarding US-Russian relations.
However Republican Senator Trent Franks said: "The president has disgraced this nation by breaking his word to loyal and courageous allies... "
Third, this indicates that the Obama team is looking closely at the claims for technology. The experts have been having some doubts about the whole shield system.
Shorter range anti-missiles have proved promising. Perhaps this means he will also be looking sceptically at claims that Iran is developing an actual nuclear weapon. That could mean a reluctance to attack Iranian nuclear plants without rock-solid information, though this would not necessarily stop the Israelis from doing so.
Not that the president wishes to be seen as soft on Iran. He states that his new proposals will be smarter and better in countering any threat from Iranian missiles.
Supporters 'let down'
Fourth, the Polish and Czech governments might have mixed feelings. They had invested considerable capital in agreeing to the system. Some US supporters in Eastern Europe might feel let down.
Others might be relieved. There will be debates about the long-term US commitment to Europe. That is why the president mentioned Nato's article 5 in his announcement - an attack on one will still be an attack on all.
Fifth, on the military side, this heralds a shift of emphasis in the whole US anti-missile defence strategy. It is not an end to it but it is a change to it.
The emphasis will now be on regional and shorter-range defence. The Israeli example might be a good one. The US is co-operating with the Israelis on the Arrow anti-missile missile and on a shorter range missile interceptor known as David's Sling.
Such methods will now come to the fore. And the existing Aegis ship-based defence, already deployed near Japan, will also have renewed importance.
Some US experts have been calling for this decision since President Obama took office. Dr Sean Kay of the Mershon Center for International Security Studies at Ohio State University wrote in a paper back in February: "These systems are not tested or proven and many European NATO allies are skeptical of the benefits. Even if these systems did eventually work they would not address the spectrum of related threats. Furthermore, they have damaged the NATO-Russia relationship in ways that risk undermining the existing balance of power in the European area."