Defense Tech and Acquisition News

What will it take to strengthen our national security and deter war.

Matt MacGregor

and

Pete Modigliani

Nov 23, 2024

Welcome to the latest edition of Defense Tech and Acquisition.

Experts offer ideas for the next administration to strengthen national security.
INDOPACOM discusses munitions inventories, networks, and geopolitics.
New insights on Defense Tech and VC landscapes going forward.
New programs and strategies emerge for AI and Autonomy.
DoD recognizes its top acquisition professionals in annual awards.
China making advancements in quantum and aircraft.

We will be taking next week off to celebrate Thanksgiving with family and friends, but will return the following week with all the latest insights and analysis.

Defense Tech

Drone 3D Printed Through Network Of Manufacturers

A startup that has devised a way to sharply reduce the amount of time it takes to build a small drone can also call on a global network of 3D printers to surge capacity.

San Diego-based startup Firestorm Labs can 3D print the airframe of a Group 2 unmanned aerial vehicle — about 21 to 55 pounds — in around nine hours and finish integrating all its components in a total of 36 hours.
The company brought its Tempest 50 drone to the Technology Readiness Experimentation in Indiana, to assess innovative warfighting capabilities.
The demo was part of the Rapid Defense Experimentation Reserve initiative.
The speed in which it can build a new airframe to three factors: the 3D printing process, design simplicity and the use of commercial-off-the-shelf components.
If there is a large order it can’t handle, Firestorm can lean on a network of 3D printing contractors in other parts of the world to take up the slack.
A finished product would be one-fifth the cost of other Group 2 fixed-wing drones.

Our Take: This is a really important capability for certain land conflicts. I’m sure Ukraine wishes they had this capability prior to the Russia invasion. I could not find range specs on the Tempest disappointingly - the site only said range was dependent on configuration. The range factor is important as it dictates how close manned forces have to be to the action. Curious to learn more here.

STRATCOM Boss: AI Useful, But Don’t Expect War Games

The head of STRATCOM has no interest in replicating the plot of the 1983 film “WarGames” but does want to use AI to more efficiently process vast amounts of data related to America’s nuclear weapons.

AI can play a role for STRATCOM, by helping humans sort through the terabytes of data that would otherwise hit the floor especially for ISR information.
AI can help provide the president with options in a matter of minutes, not hours—something not be possible without AI as more data streams become available.

“WarGames, it has this machine called the WOPR. So the WOPR actually was that AI machine that everyone is scared about. And guess what? We do not have a WOPR in STRATCOM headquarters. Nor would we ever have a WOPR in STRATCOM headquarters.” Gen Anthony Cotton

Our Take: We have to agree that its probably best there is not an AI agent making decisions on nuclear weapons release at STRATCOM HQ. Although we do hope there is at least a “big board.”

Led by Anduril, Defense Tech Funding Sets a New Record This Year

Defense tech funding just reached a new high. Defense tech startups have raised almost $3B so far in 2024, according to Crunchbase. This surpassed the previous record from 2022 of $2.6B.

It’s an impressive feat, especially considering the number of deals has shrunk: in 2022, there were 113 defense tech rounds, outpacing 2024’s 85 rounds.
The record is buoyed by a few monster rounds this year.
Anduril raised a $1.5B Series F in August
Saronic Technologies, an autonomous maritime vehicle company founded by Anduril alumni, which raised a $175M Series B.
Chaos Industries raised a $145M Series B.
German AI weapons startup Helsing raised a whopping $487M this year.
The defense tech boom shows no sign of abating: Defense investors and founders are reportedly expecting the new White House administration to provide even more opportunities for startups offering new technologies in everything from space and aeronautics to weapons and surveillance tech.

How Investors Asses Companies In 2025, Including The Defense Industry

Relative to liquid investments such as stocks or bonds, venture capital offers higher potential returns in exchange for increased investment risk and longer lockups of capital.

With regards to funding innovation, some venture investors may see partial return of capital during the life of the fund, but the average fund takes 6-10 years to return capital provided by the capital markets (through M&A or IPOs).
A venture firm that makes 10 investments, perhaps only generates one winning investment to pay back the entire fund’s invested capital — which could be 20 to 40 times (or more) the original investment.
Business model characteristics contribute to higher returns and favor software relative to hardware: low capital intensity, low startup costs and faster exits.
- Capital intensity is the capital required for product development, equipment for production and inventories to support revenue growth.
- Startup costs are the costs to initiate and develop the business which have dramatically shrunk for software in the past decade given:
  - Widespread access to high-performance computing and networking through cloud services
  - Open-source code components to build software
  - Remote-work contributions from lower-cost engineering locations due to global connectivity.
- Software firms tend to have faster time to liquidity (through M&A or IPOs) which also generates better returns - given it can be developed more rapidly than hardware, product-market fit understood sooner and scaled faster.
There are three basic factors that venture capitalists consider when making an investment to determine the likelihood of outsize returns: the founding team, the market size and technology maturity.
- The capability, experience and success characteristics of the founding team. A team is more likely to be successful than a solo founder and the team needs to have experience in the key functions required to build a business in addition to developing the core technology.
- The total addressable market of the business idea will be a critical determinant of an outsize return. If the market is too small or uncertain to build a large enough business valued at $1B or more, then the business idea will not be appropriate for a venture investment.
- The technology must be developed beyond the basic research stage so that a resulting product or solution can be delivered in a timeframe consistent with the venture investment horizon of 10 years or less.

Q3 2024 State of Venture Update

In 2023, there was an apparent oversupply of venture capitalists in the market but new data suggests that we may be nearing a correction on the staffing front.

This reflects the state of the market: while the number of investors may have peaked, dry-powder remains high!
The core industry challenge is the lack of exits while grappling with the rise of ever-larger funds at the high end of the market.
Apparently, its a conundrum to have these concurrent factors: shrinking number of investors, dwindling opportunities, stalled exits and yet more dry powder than ever - increasingly concentrated among the top firms.

How AI Can Enhance The IC's Ability To Provide Strategic Warning

Admittedly, right now AI tools currently on the market cannot reliably predict a geopolitical event significantly earlier than a human; however, this is likely to change as AI systems mature and become more powerful over the next couple of years. Areas of focus should include:

AI “agents” to monitor the open-source.
- The IC is spread thin, which means it cannot always allocate resources, particularly humans, to carefully monitor every country and situation.
- The next generation of AI tools—following in the footsteps of Open AI’s just-released o1 model and Anthropics’s 3.5 Sonnet—will be capable of orchestrating a series of actions in pursuit of broader goals.
- AI agents that monitor the open-source information space of countries where strategic events are currently not expected would allow the IC to deploy human analysts where they are most needed and reallocate analysts as needed if the agent provides a warning of anomalous activity.
Scenario generation.
- Often when providing strategic warnings, all-source analysts at agencies like CIA or MI6 are not predicting a singular event but rather assessing a range of possible events and outcomes.
- When analysts manually generate these scenarios, they are limited by time and to what they already believe to be likely outcomes.
- Instead, scenario generation could help analysts quickly identify new scenarios they had not yet considered and weigh those scenarios against one another to determine the most likely outcomes.
Data fusion and synthesization.
- A system that could more effectively and efficiently process various types of intelligence would be highly valuable.
- One possible use case would be a system that would better fuse crucial SIGINT from NSA with OSINT like public commentary and speeches made by political leaders to detect patterns and attempts to obfuscate.
- A better data fusion system would help analysts more comprehensively “get into the heads” of these leaders.
Improvements in human-machine teaming.
- Tools like crowdsourced human forecasts and automatic human feedback would bring together the rigor and breadth of expertise of human analysts and the speed of these AI tools by positioning humans to be in key positions within the process, including in the development of assessments where human-based explainability is considered imperative.

Our Take: It seems like a no-brainer to begin integrating the capabilities of AI into intelligence collection and analysis processes given the increasing amount of data being generated. The utility of this has already been demonstrated with the fielding of the Maven Smart System as one example.

New Rocket Startup Debuts with Supersonic Flight

A still from an engine test for the Dawn Aerospace Mk-II Aurora

Dawn Hypersonics revealed it has achieved supersonic flight with their prototype Mk-II Aurora craft off the coast of New Zealand.

On November 7, the Mk-II Aurora completed a 66,000 foot ascent in just 118.6 seconds, beating the previous decades-old record by more than 4 seconds.
The Mk-II builds off aircraft design and is intended to be rapidly reusable, with a turnaround time of four hours or less.
The U.S. military is racing to deploy a wide variety of high-speed, highly maneuverable missiles capable of hypersonic speeds, Mach 5 and above.
Reaching supersonic speeds while maintaining maneuverability and control is a bigger barrier - once you overcome that obstacle, the transition from supersonic to near hypersonic speed is much easier.
The ultimate goal is to get the Aurora up to about Mach 3.5, or about 2,685 mph.

“With flight test 57, Aurora became the highest climb rate aircraft ever built. The door is now wide open for Aurora to become the world's highest and fastest flying aircraft too. We really want it to act like a jet engine, but you want to have the thrust-to-weight ratio of a rocket engine, which is about 20 times better than a jet and that means you don't end up building the whole aircraft around the engine. Most of the aircraft is actually just propellant and you got a tiny little engine at the back that really just kicks ass and gets you up to these hypersonic speeds,” Stefan Powell, CTO

AeroVironment to Acquire BlueHalo Establishing Next-Generation Defense Technology Company

AeroVironment and BlueHalo announced the execution of a definitive agreement under which AV will acquire BlueHalo.

The Formula to Create Iron Men and Women

Greg Little and Akshay Krishnaswamy

The fictional character Tony Stark’s superpower is in his remarkable vision to blend human ingenuity and cutting-edge technology. And contrary to the moniker Iron Man, the secret to his success is not the metal flying suit—it is the operating system companion coaching him through every battle with superhuman computations, simulations, data analytics, and strategic support.

For DoD, the lessons from Stark’s approach are profound. The future of national security depends on harnessing a dual-tier AI system:
- a J.A.R.V.I.S. that empowers the individual warfighter and weapon system and
- a F.R.I.D.A.Y. that manages and optimizes operations at scale.
The challenge lies in building an AI and data architecture for AI and human teaming that can integrate these capabilities effectively and securely.
Here would be Tony Stark’s plan for modernizing DoD:
- Pre-Built AI Products. Tony Stark would start with pre-built AI workflows and products that are available to the entire organization. In simple terms, workflows are sequences of automated processes that handle tasks or data, making operations more efficient and effective.
- Custom AI Products. Operators would develop mission-specific algorithms and workflows that adapt in real-time, anticipating enemy tactics, calculating tactical maneuvers, and guiding the warfighter toward safer and more effective outcomes.
- The Ontology Layer. This represents the nouns and verbs or digital twin of an organization and provides a structured framework that helps an AI system understand and connect pieces of information in a common and meaningful way, turning raw data into actionable insights.
- Data Services. These would serve as the vital circulatory system of these AI systems, encompassing the robust infrastructure needed to move, process, and store data in a way that ensures rapid access and usability by AI.
- AI Services. These would enable continuous learning and advanced capabilities. These services refer to the computational tools that allow an AI to learn from experience, run complex models, and adapt to new information.
- Workflow Services. This would bridge the gap between human operators and these advanced AIs to facilitate the automation and management of tasks, making collaboration between humans and AI smoother.
- Security and Governance. This would be built into the core of these systems with protocols and policies that protect data and ensure compliance.
- Software Delivery. This layer would ensure that J.A.R.V.I.S. and F.R.I.D.A.Y. stay at the cutting edge of capability. This layer refers to the infrastructure that supports the deployment and updating of software without interruptions.

Acquiring AI Companies: Tracking U.S. AI Mergers and Acquisitions

Jack Corrigan, Ngor Luong, and Christian Schoeberl

The commercial AI industry is evolving rapidly, and the competition dynamics in this burgeoning sector will impact the rate, diversity, and direction of AI innovation in the years ahead. Maintaining U.S. technological leadership in the years ahead will require policymakers to promote competition in the AI sector and prevent incumbent firms from wielding their market power in harmful ways. We found:

Annual M&A transactions involving AI companies more than doubled over the last decade, from 225 in 2014 to 494 in 2023.
The proportion of total M&A transactions in which non-AI companies acquired AI companies grew from 10% in 2014 to 45% in 2023.
Large incumbent tech companies rank among the top acquirers of AI companies, including Apple (28 transactions), Alphabet (23), Microsoft (18), and Meta (16).
In U.S. cross-border AI acquisitions, American firms have purchased 503 foreign AI companies, while foreign firms have bought 271 American AI companies.

DOD Preparing for Hypersonics 2.0 and 3.0 to Understand Operational Concepts

As several of the U.S. military services continue to develop and test hypersonic missiles, the DoD at large is concurrently working to understand how the weapons will fit into joint warfighting operations once they are fielded.

Over the next couple of years, the JROC plans to move into the next phases of hypersonic weapons development known as hypersonics 2.0 and 3.0.
The effort will focus on analyzing exactly how the technology will contribute to closing future kill webs — that is, the multi-layered and multi-directional structure of attack leveraging assets from all domains. Where do hypersonics fit into how we are going to fight?
We know that hypersonics allow us to get after time-critical, heavily defended targets. We know that hypersonics allow us to defeat adversary hypersonics.
We also know that hypersonics allow us to leverage hypersonic aircraft and spacecraft missions in those two domains.
The Army is working alongside the Navy to co-develop a common hypersonic glide body, which the Army will integrate into ground launchers for its version — known as the Long-Range Hypersonic Weapon (LRHW) or Dark Eagle — while the Navy plans to use a ship-launched capability called Conventional Prompt Strike (CPS).
ADM Grady also emphasized the importance of working with Congress on getting flexible funding.

Pentagon's Software Approval Process Is Crushing Innovation

Aiden Buzzetti

The DoD is actively undermining our national security, and most Americans don't even know it's happening. It isn’t happening because of any nefarious plot or external threat, but through a bureaucratic approval process that's choking competition while holding technological innovation within our military.

The current Authority to Operate (ATO) process – the system for certifying new software for military use – is one of the most antiquated in government.
It's too slow, too expensive, and ultimately serves to create a monopoly that benefits a handful of large defense contractors while shutting out new and innovative solutions from startups our warfighters desperately need.
The Pentagon increasingly relies on a small handful of giant contractors who can afford to wait out the bureaucracy. We're creating the same kind of dangerous dependency with software that we already have with hardware, where only a few companies can build our ships and aircraft.
This isn't just inefficient – it's dangerous.
Congress must pass the proposed ATO reforms in the current NDAA.
Establish clear pathways for small businesses and startups to enter the defense market.
In our effort to ensure impenetrable security, we cannot tolerate an approval process so onerous that it prevents us from deploying new tools and capabilities.

Army

Make Army Futures Command Great Again

Michael McInerney

The next Army Secretary will need to refocus and re-energize the Army while eliminating bureaucratic waste. Among the many complex tasks ahead, one move is simple and clear: Return Army Futures Command (AFC) to the purpose it was created for. Restore its authority, restore its power, and let AFC do what it does best—modernize the U.S. Army for the battlefields of tomorrow.

AFC was envisioned as the spearhead of Army modernization. Backed with budget authority, AFC wielded real influence over investment decisions.
The goal was to create a streamlined, fast-moving command able to dodge bureaucratic bottlenecks, cut through “analysis paralysis” and deliver next-generation capabilities.
An empowered AFC began immediately to eliminate unnecessary programs and deliver the Army that we need—one equipped with state-of-the-art technology and ready to deter future adversaries.
But in 2021 two memos that stripped the command of its budget authority and effectively neutered its mission. Without budgetary control, AFC became a figurehead, forced to provide unwanted advice from the sidelines while Army modernization returned to the same slow, bloated, and ineffective Pentagon bureaucracy it was meant to disrupt.
AFC was designed to deliver the weapons, technology, and capabilities needed for future conflicts. But without real authority, AFC remains little more than an advisory body—a high-level think tank when what we need is a lean, capable, and empowered modernization engine.
Reinstating AFC’s budget authority would re-arm it in the battle against bureaucratic inertia and give it the tools needed to shape the Army of the future.

Army taps ‘Ghost Fleet’ Authors to Write Novel on Multi-Domain Warfare

Task Force Talon: A Novel of the Army’s Next Fight, written by “Ghost Fleet” authors August Cole and P.W. Singer, will share the real-world lessons from Field Manual 3.0, as well as lessons learned from both contemporary conflicts and recent Army exercises and training.

Warfighting tech described in the excerpt includes tactical augmented reality glasses; persistent hostile drone surveillance; micro-targeted disinformation targeting military families, including AI-generated video and audio; and next-gen dashboard screens fusing satellite data and ground networks.
Singer and Cole ultimately launched Useful Fiction, a partnership through which they hold writing workshops for U.S. and allied military entities including SOCOM and the Air Force’s Air University, among others.

Highly recommend reading Ghost Fleet by P.W. Singer and August Cole.

Navy

Should the Navy Lean on Private Repair Shipyards to Build Subs Faster?

As the Navy battles ongoing schedule delays, supply chain problems, and workforce challenges in its effort to produce more submarines, the service may need to turn to private repair shipyards to rebuild capacity.

“I would argue that there is some additional capability at existing yards. But one of the untapped potentials there are the ship maintenance yards. Ship maintenance yards have a whole bow wave of work that comes in, they get the work done, and then the work drops off. These private repair yards have a lot of capacity to do work in new construction while they are managing the repair work there—much of it is exactly the same. In fact, what we're seeing right now is the big yards using smaller contractors to build parts of those ships.” Rep. Rob Wittman, R-VA

We need incentives to encourage shipyards to complete work on time, as well as penalties for missing strict timeframes.
Earlier this year, the Navy set up a program office to focus on converting submarine industrial base efforts—including workforce and manufacturing technology—to submarine sustainment, surface shipbuilding, and repair.
The sustainment goals are getting nuclear-powered submarines to 80%, getting the Ohio to even past the end of its life in serving the nation.
But every bit as important are the manufacturing technology efforts and the workforce efforts that submarine industrial base is doing…those are a rising tide that floats all boats
U.S. shipyards are up to three years behind on submarine orders for the Navy’s Columbia and Virginia class submarines, and the AUKUS deal to provide Australia with submarines has added even more pressure.
The lack of skilled workers is also causing sub-building delays. The DoD is putting billions of dollars into rebuilding the submarine workforce.

Other Navy News:

Air Force

USAF To Fully Staff Modernization Command To Build ’27 Budget

The Air Force expects to have its new modernization-focused command fully staffed by early next year to begin informing the service’s FY27 spending plan. The service last year announced the creation of the Integrated Capabilities Command (ICC).

The Air Force Is Redesigning Itself

Bill Sweetman

The Resolute Force Pacific (REFORPAC) exercise will be the largest Air Force non-combat deployment in many years, with more than 300 aircraft involved. The two-week exercise in mid-2025 will coincide with the multinational, biennial, all-domain Talisman Sabre training event. It is an important step in a radical force redesign.

REFORPAC will draw large forces from fewer units, to provide more intensive and realistic training.
As Air Force leadership and the new Integrated Capabilities Command carry forward a process called Force Design, REFORPAC is designed generate real-world experience.
The U.S. Air Force may not be able to afford to structure itself entirely around high-end (read: stealthy) aircraft and systems—and it may not need to.
If there are systems there that are less lethal, they are there so that we don’t grind the others down facing a cost-imposition strategy.
Mass may be about having assets that must be addressed, to deplete the adversary’s inventory.
Speed is imperative. The adversary will put effects in immediately. There will not be an iron mountain and we need to disrupt and deny early.
Solve for agility. We’ve shown too much hubris about our ability to predict the future, even in our own technology base.
Mission Area 1 (MA1) capabilities can live within and generate combat power from the dense threat area which will be under constant attack from missiles or drones.
MA2 capabilities operate from the defendable area of relative sanctuary beyond the umbrella of most adversary ballistic and cruise missiles … and project fires into highly contested environments.
MA3 capabilities create the flexibility and mass to span a range of potential future crises … with positions resilient to limited adversary attack.

For air superiority, the Air Force must pursue effective, rather than ‘affordable,’ mass

Lt Col Shane Praiswater and Maj Matthew Guertin

Constrained for funds and facing rapidly improving potential adversaries, the Air Force (USAF) is grappling with how to ensure control of the air in the 2030s.

One proposal — leaning heavily on standoff forces to provide “affordable” mass without traditional air superiority — has a problem: even with long-range kill chains, exquisite smart weapons, and low-cost swarms, no one has specifically described how such novel ideas would lead to victory.
As the USAF considers difficult standoff versus stand-in decisions and what future control of the air might entail, the debate must return to a critical focus: how to produce effective mass.
The terms “stand-in” and “standoff” forces are popular among USAF planners but do not exist in USAF or DoD doctrine.
Five Issues with Standoff-centric Theories of Victory
- A standoff-centric approach might play into adversary capabilities and potential plans, as an opponent must only dodge or defeat a finite number of cruise missiles and drones.
- If the USAF depends on standoff-centric tactics and abandons air superiority, it is taking an ambitious leap away from historical lessons learned.
- Creating an effective deterrent, always a tenuous concept at best, is much more difficult when you’re relying primarily on stand-off systems.
- A standoff-centered force reduces the political means available to leaders attempting to manage escalation.
- A force designed primarily to prevent losses will be brittle and unthreatening to anti-access and area-denial defenses, as stand-in effects are a critical part of attrition when fighting adversaries capable of producing overwhelming mass on their home turf.
A balanced force that prioritizes effective mass over affordable mass and always pursues some version of control of the air via stand-in capabilities is key.

Other Air Force News:

Air Force, Boeing Agree on $2.4B Deal for 15 New KC-46 Tankers

Space Force

Pentagon Sends Mixed Signals on Space Innovation

The Pentagon is putting $13B behind its talk of embracing commercial space, committing serious money to LEO satellite services.

This marks a dramatic increase in spending on commercial satellite services, with the so-called PLEO contract jumping from $900M to $13B over a decade.
Unlike the military’s typical procurement approach, the PLEO contract gives vendors greater flexibility to tailor services to customer needs rather than following rigid government specifications.
Companies across the industry are eager to see this model expand to other military space programs.
But entrenched procurement habits die hard, and while integration of commercial space capabilities is progressing, practical challenges remain.
DoD requests customized satellite configurations even for fixed-price contracts.
Constant requirements creep that undermines the very efficiencies DoD seeks.
While DoD and the Space Force have published high-level strategy documents for commercial space integration, they lack the specific guidance companies need to confidently align their development roadmaps.
DIU is stepping up efforts to push commercial solutions in defense programs.

The Future With Hypersonics

Rep Vince Fong

With oppressive regimes racing ahead in hypersonic technology, the United States can no longer approach hypersonics as “business as usual.”

To stay competitive, NASA must bring the private sector into its hypersonic development plans, expanding on successful public-private partnerships like those that DoD has fostered with companies such as Stratolaunch.
A similar approach to hypersonics must be taken within NASA to complement the DoD’s work with the industry, creating a whole-of-government strategy that leverages NASA’s research and exploration goals alongside DoD’s priorities.
That is why I introduced authorization for the Making Advancements in Commercial Hypersonics (MACH) program in an amendment to the NASA Reauthorization Act of 2024.
If it becomes law, this bill could build a bridge to connect NASA and the booming commercial hypersonics industry, unlocking this bold vision for the future.
NASA, through the MACH program, must capitalize on existing government infrastructure to amplify an existing, robust private sector that is already fostering rapid advancements in hypersonic technology.
NASA can focus on what it does best—pushing the boundaries of science and exploration — while private industry continues to develop the systems and technologies that make hypersonic flight a reality.

Space Force Taps OpTech for $4.5M Optical Sensor Payload

The Space Force awarded firm Optimum Technologies (OpTech) a contract to develop an optical imaging payload for a mission scheduled to fly in 2026.

The mission known as Victus Surgo is part of the Space Force’s Tactically Responsive Space (TacRS) program, an initiative aimed at leveraging commercial technologies to respond to potential threats in orbit.
A core objective of the program is to deploy a sensor payload to inspect and characterize threats like anti-satellite weapons, reflecting growing concerns over adversarial actions in geosynchronous orbit, a critical zone for military and commercial satellites.
This payload will be transported on Impulse Space’s Helios transfer vehicle that will transport a smaller Mira vehicle carrying the OpTech payload from low Earth orbit to geostationary transfer orbit - it will be its first flight.
The Helios vehicle will fly to orbit on a SpaceX Falcon 9 rocket.

Lockheed Martin’s New Mid-Size Satellite Platform Closer to Launch

Lockheed Martin announced that its new mid-size satellite platform will make its orbital debut next year aboard a Firefly Aerospace rocket.

The LM 400 satellite bus — roughly the size of a household refrigerator — represents Lockheed’s bid to capture a sweet spot in the satellite market: missions requiring more power and payload capacity than small satellites can provide, but not demanding the complexity of traditional large satellites.
The planned demonstration mission in low Earth orbit, carrying a communications payload, comes after a three-year development period marked by supply chain disruptions that delayed the platform’s original 2023 launch target.
The program also faced a setback when its initial launch provider, ABL Space, struggled to get its launch vehicle operational, prompting Lockheed to pivot to Firefly’s Alpha rocket under a new multi-launch agreement.

SDA Will Be 6 Months Late Launching Next Satellites, But May Up the Pace After That

SDA will start launching its next batch of satellites in March or April 2025, six months later than originally planned, but agency director Derek Tournear suggested he may try to increase the pace of launches after that to get back on schedule.

Tournear said all of Tranche 1 will launch over 10 months at a “maximum.” That timeline would have launches extending into 2026—the same year Tranche 2 satellites are supposed to start going up.
While Tranche 1 satellite production is ramping up and design reviews for Tranche 2 have finished, SDA is already moving forward on Tranche 3, with plans to officially ask industry for proposals starting in January 2025.
Among the 150 or so data transport satellites, a “fraction” will include a new “lightweight” position, navigation, and timing signal.

“We know SpaceX can launch faster than once a month, so we can bring this in. The space vehicles will be ready faster than that once we start the initial launching, but it’s just a matter of how fast will it take us to get through launch and early operations and pull that in.” Derek Tournear

ROTC-Like Recruitment Program Helping Space Force Find Civilian Guardians

Like its sister services, the Space Force has officer, enlisted and civilian members — all called guardians. But the Space Force is looking for new ways to recruit civilian employees, which right now make up about 50% of the service.

On college campuses, the Space Force is part of a congressionally mandated pilot program, the Defense Civilian Training Corps, or DCTC, which has similarities to ROTC, but which instead aims to bring university graduates into the military as civilian employees rather than uniformed officers.
Kelley said students participating in the program have expressed interest in Space Force's research and development work, problem-solving technologies for space and how weather conditions impact satellite architectures.

Other Space Force News

Acquisition Workforce

2024 Defense Acquisition Award Winners

Individual Achievement Award

Acquisition Security: Israel Reyes, SOCOM
Business Cost Estimating Katherine Jeffery, Air Force
Business Financial Management Tracy Showman, DHMS
Contracting Christie Orlando, SOCOM
ETM (Engineering/Technical) David Clifton, Air Force
ETM (Production/Sustainment) Cheryl Redmon, Air Force
Flexibility in Acquisition William "Greg" Davis, Air Force, LtCol Raquel Salim, Space Force, Christopher Wilson, SOCOM
International Security Cooperation Maj Jacob Singleton, Space Force
Life Cycle Logistics Dyan Hooper, Navy
Program Management Col Timothy Hough, Marine Corps
Requirements Management LCDR Grant Strickland, Navy
Services Acquisition Claudia Evans, Air Force
Small Business Luz Maria Vasquez, DCMA
Software Development Ricardo Ferra, NRO
Software Management Noelle Marchbanks, SOCOM
Test and Evaluation Lindsay Underwood, Navy
Value Engineering Christopher Cerjan, SOCOM

Team Award

Software Innovation Team Award
- NGAD Software Factory, Air Force, Wright-Patterson AFB, OH
Flexibility in Acquisition Team Award
- Product Manager Robotic Combat Vehicle, Army, Detroit Arsenal, MI
- Multi-Domain Combat Systems Division/Enhanced Combat Systems Team, Air Force, Washington DC
- Satellite Communications Team, Space Force, Washington DC
- SOF AT&L Innovation Cycle-International, SOCOM, MacDill AFB, FL
Workforce Development Innovation Award Winner
- Large Organization: NAVSUP WSS N972 Support Division, Navy, Mechanicsburg, Pennsylvania
- Small Organization: SOF AT&L, SOCOM, MacDill AFB, FL
David Packard Excellence in Acquisition Award
- Integrated Fires Mission Command Project Office, Army, Huntsville, AL
- PMA-201 Emergent Requirements Team, Navy, Patuxent River, MD
- Collaborative Combat Aircraft Team, Air Force, Wright-Patterson AFB, OH
- EUCOM Support Team, Air Force, Wright-Patterson AFB, OH
- SOF Counter Unmanned Systems, SOCOM, MacDill AFB, FL

Our Take: A huge kudos to all the award winners. It is so great to see this mix of organizations and awards that value flexibility, software, and workforce innovation. We need to understand the special sauce of these winners and mass produce it. DoD acquisition is a complex operation that requires top talent to navigate the bureaucracy to rapidly deliver capabilities to the warfighters. It looks like SOCOM is leading the way this year.

GAO Bid Protest Annual Report to Congress for FY24

During FY24, we received 1,803 cases: 1,740 protests, 33 cost claims, and 30 requests for reconsideration. We closed 1,706 cases during the FY: 1,635 protests--23.7% of which were issued merit decisions (sustain or deny), 39 cost claims, and 32 requests for reconsideration. Of the 1,706 cases closed, 346 were attributable to GAO’s bid protest jurisdiction over task orders.

Most Prevalent Grounds for Sustaining Protests Of the protests resolved on the merits during FY24, our Office sustained 16% of those protests. Our review shows that the most prevalent reasons for sustaining protests during FY24 were:

Unreasonable technical evaluation
Flawed selection decision
Unreasonable cost or price evaluation.

International

China’s Quantum Gamble: Investment Controls Are Here, But Does China’s Quantum Industry Really Need US Dollars?

On October 28, 2024, the Treasury Dept. implemented the USA’s first-ever outbound investment control regime either requiring notification or banning any investments in AI, semiconductors/microelectronics, and quantum technologies in “countries of concern” (China incl. Hong Kong and Macau).

For semiconductors and AI, the restrictions are confined to certain technical specifications and capability thresholds. The restrictions on quantum technologies, however, are far more expansive forbidding investment in: .
1. Quantum computers and their critical components,
2. Quantum sensing platforms for military, intel or mass-surveillance end use,
3. Quantum communication systems for secure communication, for scaling up quantum computing, and any other application with military, intel, or mass-surveillance end use.
In the short term, these prohibitions aren’t going to devastate China’s prowess in quantum research. The practical implications for the future, however, are:
1. The restrictions could systematically push the sector to further rely on state-led “patient capital.”
2. The rules could inadvertently reduce the transparency of China’s commercial quantum efforts.
3. If quantum technologies become foundational for information infrastructure in the future, the rules will ultimately restrict a much wider variety of economic activity than they do today.
Reports have noted that despite large numbers of Chinese quantum companies, there are only 14 private-sector firms that are making significant contributions to quantum technology, including nine start-ups and five major tech companies.
China’s equity investment market is in deep trouble, which brings headwinds for quantum startups - in a survey of 50 leading VC and PE institutions by ChinaVenture, less than 5 were optimistic.
Besides just bad sentiment, investment activity is down — science parks visited by the Financial Times stand empty as fewer start-ups are founded and successful exits through IPOs are increasingly difficult.
With foreign investors fleeing and a dying venture capital market, is it all doom and gloom for China’s quantum start-ups?
There are at least two reasons why this might be an overeager conclusion — one is our lack of knowledge, and the other is the support of the state.

Mission Driven Entrepreneurship: Shaping a Generation for Defense- and Dual-Use Tech

Ali Hawks and Pete Newell

A troubling truth exists throughout Europe today: Defense tech companies cannot find the right talent to fill the growing demand in their industry to satisfy the increasing interest in dual-use investment.

The search for talent has been described as a “knife fight” to win high-quality, trained people to the defense sphere, due in part to:
- A lack of interest and awareness in defense-related work,
- There being too few capable professionals trained and specialized in solving defense-specific problems.
The talent shortage is especially distressing in critical areas like deep tech and artificial intelligence.
Solving this shortfall requires a paradigm shift in the way countries foster defense-minded ingenuity and passion since the best defenses against our enemies are strong partnerships and unbreakable networks.
This means we must not only foster talent among those with a natural proclivity for defense and national security, but spark a potential latent interest in defense and security in our talent overall.
Hacking 4 Defense® (H4D) pairs university student teams with defense-agency sponsors, sparking national support among future generations while delivering innovative solutions that address both national security and commercial challenges.
Since 2016, the course has grown from a single school in the U.S. to a growing global program hosted by 60 U.S. universities, 24 UK universities, and two Australian universities.
More than 4,000 students have taken Hacking 4 Defense, addressing over 1,000 problems from across the U.S. DoD and IC, UK MoD, and Australian DoD.
Our program has sparked untapped entrepreneurship in this talent, spinning out 63 companies that have raised more than $380M in private capital funding.

Key Achievements in the UK

Identification of Critical Vulnerabilities.
- In the Autumn of 2023, when the UK’s military forces needed to effectively communicate in a high-tech environment without compromising their safety and security, they brought their challenge to a team of BSc Physics students at the University of Leicester enrolled in H4MOD.
- After conducting over 90 interviews with problem-knowledgeable people both inside and outside Defence, the student team proposed an innovative three-part solution including drone-based deception to confuse adversaries on military unit location, directional antennas to control and enhance signal transmission, and strategic uses of hardware components.
Development of New Tools.
- Participants in H4MoD have developed innovative tools and techniques that have been adopted by the UK Ministry of Defence, enhancing the country's ability to detect and respond to multiple threats.
- One team, collaborating with the Royal Navy and international partners, developed a low-data platform allowing navigators to share observational data and glean insights from others'
Talent Development
- H4MoD has helped to cultivate a pool of talented innovation startup professionals in the UK.
- Former students now play a crucial role in protecting the country's national security, solving broad challenges in the commercial sector as well as supporting the local and national economies.

Bottom Line: Hacking for Defense can bridge the defense tech talent gap, foster allied cooperation across NATO countries.

AUKUS Nations Ink New Hypersonic Tech Sharing Agreement

The U.S., U.K., and Australia today signed a new agreement under the AUKUS trilateral security pact that will allow the three countries to use one another’s hypersonic weapons testing facilities as well as share technical information needed to develop and manufacture the technology.

The new agreement has been dubbed the Hypersonic Flight Test and Experimentation (HyFliTE) Project Arrangement, and will include up to six trilateral test flight campaigns by 2028 using a $252M funding pool.

AUKUS will ‘cannibalize’ other programs with no budget boost: Former top Aussie general

Sounding the alarm that the AUKUS nuclear submarine deal will eat into non-naval priorities, the former head of the Australian Defense Force today called for a significant boost in defense spending, up to 3% of GDP.

The recent Defense Strategic Review and its Integrated Investment Plan projects a $55.5B AUD budget rising to $67.9B in 2027-28 — roughly 2.2% of GDP.
The current government in Canberra has pledged to increase defense spending by $50.3B over the next decade, with the plan being to hit $100B by 2033. That would put the country at 2.4%.
Sir Angus Houston said the AUKUS submarine deal must be a net addition to Australia’s military capability which can only be accomplished with an increase to defense spending by 3% plus of GDP moving into the 2030s.
There may be signs of budget pressure emerging already as earlier this month, Australia killed a $5.3B AUD satellite contract with Lockheed Martin, and more cuts likely to happen as the true cost of AUKUS emerges.

Classified-Info Pact Sets Stage for Closer US-Philippines Cooperation

U.S. and Philippine leaders broke ground on a new coordination center—and a new era of military cooperation as the country shifts its security focus from internal rebellion to Chinese incursion.

Secretary Lloyd Austin signed a classified-information agreement which sets out rules for sharing classified intelligence and other data, including how to handle it, safeguard it, and report breaches
The two countries—treaty allies since 1951—have long shared information on various occasions and in various ways, but the agreement will greatly streamline the process.
Formally called the General Security of Military Information Agreement (GSOMIA), the pact follows a more-or-less standard template used with at least 10 other U.S. security partners.
It was more than two years in the making because of the necessary negotiations, planning, training, infrastructure improvements, and more.
The pact also lays the groundwork for the nascent Combined Coordination Center at Camp Aguinaldo.
The building, to be erected in a vacant lot at the camp, will essentially give U.S. personnel—military as well as diplomatic—a purpose-built space where they can meet, plan, and operate with their Philippine counterparts.

Blueprints for China’s New Fighter Similar to F-35, Air Force Chief Says

The Air Force’s top officer said China’s new stealth fighter has one distinctive feature: It appears to draw its inspiration from the U.S.’s F-35.

China’s J-35A was recently unveiled at the Zhuhai Air Show by China’s PLA.
China has a long history of copying U.S. aircraft designs, though that doesn’t mean their aircraft are as capable as their U.S. counterparts in other respects.
China also operates another stealth fighter, the J-20 air superiority aircraft, and is working on the H-20 flying wing stealth bomber.
China has over 3,100 aircraft in the PLA Air Force and PLA Navy of which about 2,400 are combat aircraft.

“It’s still fairly new, but, yes, it’s pretty clear; you could put it side-by-side and see, at least, where we believe they got their blueprints from, if you will.” Gen. David Allvin, CSAF

US, Australia, Japan Deepen Defense Cooperation

Japan, Australia, and the United States are strengthening their three-way defense cooperation—vowing, among other things, to consult with each other in military planning and regional crises.

The increased coordination will take place under a new structure called the Trilateral Defense Consultations.
Some key announcements included:
- Japan’s new Amphibious Rapid Deployment Brigade will join annual U.S.-Australian exercises held by the Marine Rotational Force–Darwin, starting with Talisman Sabre 2025 and building toward the countries’ first air- and missile-defense live-fire training event in the exercise’s 2027 edition.
- Australian forces will join U.S.-Japanese exercises, beginning with Orient Shield 2025, and increase its participation in others, including Yama Sakura, Keen Edge, and Keen Sword.
- The three nations will look for ways to increase Australian participation in the U.S.-Japanese Bilateral Information Analysis Cell.
The three nations will also deepen their cooperation with the Indian military in the realm of maritime domain awareness.

INDOPACOM is Replacing a Pile of Partner-Nation Networks With Just One

After years of building bespoke networks to connect with individual allied and partner militaries, INDOPACOM is preparing to bring nearly two dozen countries into a single network in 2025.

This INDOPACOM Mission Network (IMN) is meant to replace the current unwieldy situation with a single seamless and secure platform that provides a common operating picture, file transfer, voice and chat tools.
While the IMN itself is meant for high-level information-sharing, it is intended to eventually enable new tactical networks as well.
As INDOPACOM expanded its exercises with regional militaries over the years, it often tailored a new network for each new partner or ally, ultimately creating some 20 of these bespoke networks.
This made adding partners to multilateral wargames increasingly complicated.
Exercise Bold Quest 24 will serve as proof of concept for the new Indo-Pacific Mission Network Tactical Data Center. By 2025, the mission network is expected to reach full operational capability during Exercise Pacific Sentry.
By the end of next year, INDOPACOM aims to connect 23 nations with key applications like phone and video calls, chat tools, file sharing, email, and a common operational picture.

“Most of our operations are not just joint, they are combined, they're multilateral, and this network of alliances and partnerships are, in fact, our key strategic asymmetric advantage,” so that we're operating off the same picture at all times, we're able to pass mission orders at all times, so that we're able to achieve unity of effort at all times.” ADM Sam Paparo

INDOPACOM Boss Not Worried About China ‘Playing Chicken’ in Pacific

The head of INDOPACOM doesn’t see 2027 as a definitive date for China to invade Taiwan, nor is he concerned that the increasing frequency of provocative Chinese naval maneuvers will lead to war with the U.S.

However, there is concern about U.S. readiness in the region, especially after supplying Ukraine and Israel with billions of dollars in munitions.
China’s 2005 anti-secession law, aimed at Taiwan, says it will invade only if:
- Taiwan declares its independence from China.
- A third power intervenes in the dispute.
- Beijing determines that “unification was irrevocably beyond its reach by any other means.”
Paparo argued China prefers to achieve its goals through coercion by other means instead of military conquest.
Paparo is also worried about general readiness due to low weapon stocks.
Weapons can be moved to any theater—none are reserved for any theater but inherently it imposes costs on readiness to respond in the Indo-Pacific region, which is the most stressing theater for the quantity and quality of munitions.

“Now with some of the Patriots that have been employed, some of the air-to-air missiles that have been employed, it’s now eating into stocks. To say otherwise would be dishonest. We should replenish those stocks and then some. I was already dissatisfied with the magazine depth before the two conflicts erupted, and I’m a little more dissatisfied with the magazine depth. You know, it’s a time for straight talk.”
“The way one controls for unintended escalation is by enhancing one’s understanding of the strategic environment or of the tactical environment. There is concern about a scenario where there are two vessels in close proximity to one another. They’re playing chicken on the high seas, and there is a collision. That collision results in some bravado … passions are inflamed, and this results in a conflagration with a big war.. That scenario does not keep me up at night because U.S. units are trained to be safe, to be within the rules.” ADM Paparo

Top Pentagon Weapons Buyer Says Houthis Have "Scary" Anti-Ship Missiles

The Pentagon's most senior acquisition official, Bill LaPlante warned that Yemen's Houthi rebels have developed "amazing" ballistic missile capabilities over the course of the past year - capabilities that are only shared by a few advanced nation-states.

Houthis have achieved a level of missile technology and a rate of production that are astonishing for a regional militant group of their size.
The terrorist organization has transitioned away from UAVs and towards ballistic missiles for attempting strikes on U.S. Navy assets, and this is because of the missiles' heavier punch.

"The Houthis are getting scary. They now have anti-ship ballistic missile capabilities that are long range and can do things that are just amazing," he said. "You have this group producing thousands of ballistic missiles that . . . I'll just say, can do technical things that only the advanced countries could do. And they're producing them at at some degree of scale. It's just remarkable." Dr. William LaPlante

Congress

As new leadership and committee membership take shape, Congress must still pass the FY25 NDAA and the FY25 defense appropriations bill. The word on the Hill is one will get done in December and one will be punted until early next year.

The #1 thing Congress can do to support national security is to pass a defense budget on time. As we’re two months into FY25, the costs and risks to the DoD and industry continue to increase.

Podcasts, Books, and Videos

Transcript

Why Smart GovCon Bidders are Turning to AI w/Alex Cohen, Defense Mavericks
Space Force Personnel Management w/Katharine Kelley, Aerospace Nation

Upcoming Events and Webinars

Defense Manufacturing Conference, JDMTP, Dec 2-5, Austin, TX
Counter UAS Technology, SAE Media Group, Dec 2-4, Arlington, VA
Defense TechConnect Innovation Summit and Expo, Dec 3-5, Austin, TX
I/ITSEC Training/Simulation Conf, NTSA, Dec 2-6, Orlando, FL
Space Resiliency Summit, DSI Group, Dec 4-5, National Harbor, MD
Reagan National Defense Forum, Dec 6-7, Sumi Valley, CA
Army IT Day, AFCEA Nova, Jan 8, VA
WEST 2025, AFCEA, Jan 28-30, San Diego, CA
See our Events Page for all the other events over the next year.
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pioneerlion

Many good suggestions, but fixed price contracting is not one of them; especially for design and development of new platforms, weapons, and systems. There are other ways to for enhancing awards to commercial and non-traditional primes, but knee-jerk FP (and especially FFP) methods stifle innovation and problem solving when the cost rises to the target price. And besides, requests for equitable adjustment and claims are always a way out for contractors even in FFP contract types, and the adjudication is often in the contractor’s favor…I mean companies have to make money for shareholders and they employ “millions of registered voters” that members of Congress do not want to see laid off when defense contractors lose money (80’s pop culture reference intended).

I like the idea of a Navy innovation acquisition unit similar to the AF; just make sure that unit has priority within Navy POM and BES formulation.

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Ahmed’s Stack of Subs

“Houthis have achieved a level of missile technology and a rate of production that are astonishing for a regional militant group of their size.”

would seem more likely that they would be getting tech rather than producing it. 🧐🤔