Pentagon Overhaul Accelerates
New Boards, Tech Czars, and the $2.6 Trillion Arms Race
Welcome to the latest edition of Defense Tech and Acquisition.
Commercial First Acquisition Will Fail Unless This Changes
USD(R&E) has new leads for critical tech areas and merges board.
The Army wants more HADES and opens its test ranges to industry.
The CNO teases a new Hedge Strategy and Fighting Instructions
Air Force may need to rethink 6th gen while it improves B-21.
Space Force pursuing CSOs, on-orbit exercises and maneuver ops.
Golden Dome needs to even the cost equation - and share w/Congress.
NDS weak on China details but PLA purge presents opportunity.
Pour yourself a fresh cup of hot coffee or cocoa and dive in. Stay warm!
Why Commercial-First Acquisition Keeps Failing in Practice
TL;DR: Cost Analysis Practices Are the Red Tape No One is Talking About
The statutes, regulations, and executive direction are clear: the federal government is expected to prioritize commercial solutions, expand participation from nontraditional firms, and move faster. Yet in practice, commercial companies are still routinely treated like cost-reimbursement primes that are asked to provide cost breakdowns, certified cost data, and accounting artifacts that do not reflect how they operate.
It lives in tactical execution: in how contracts are structured, how prices are evaluated, how files are reviewed, and what contracting professionals are implicitly rewarded for producing.
Cost analysis remains the default not because it is required, but because it is familiar, auditable, and aligned with long-standing expectations about what a “safe” contract file looks like.
The Department continues to default to cost analysis and granular cost breakdowns even where such analysis is not required.
This practice disproportionately excludes venture-backed startups, small business firms, and commercial providers from defense markets and
imposes unnecessary administrative burden and compliance friction on firms that do attempt to participate
lengthens award timelines
reinforces industrial base consolidation
directly conflicts with senior leadership direction to accelerate fielding and broaden market participation.
Cost analysis examines a contractor’s individual cost elements, such as labor hours, indirect rates, materials, and profit, to determine whether each element is reasonable.
Price analysis, by contrast, evaluates whether a proposed price is fair and reasonable without examining individual cost elements.
A common contracting assumption is that lack of price competition, typically associated with traditional FAR-based competitions, automatically requires cost analysis.
All the statutory and regulatory preference for commercial acquisition point toward price analysis (not cost analysis) as the primary mechanism for evaluating commercial pricing in a manner consistent with commercial practices and commercial standards. The gap is not in policy, but in execution.
Recommendations:
Reset the Default.
Set Clear Expectations and Reverse the Burden.
Align Incentives
Our Take: Bonnie is absolutely correct. Commercial Acquisition as required by statute, EOs, the FAR, and the Acquisition Transformation Strategy along with a drive to revive the industrial base will FAIL if the practitioners on the front lines continue to apply legacy thinking to contracting and cost. Read Bonnie’s full post. DAU, DCMA, and the PAEs must expand on this in reinforced training and tools to the workforce ASAP. Leaders must educate and evangelize using price analysis when applicable. Cost vs price analysis could be a metric tracked in the new WAS.
R&E Critical Tech Area Senior Officials
DoD CTO Emil Michael announced senior officials for the six critical technology areas:
Applied Artificial Intelligence (AAI): Mr. Cameron Stanley
Biomanufacturing (BIO): Dr. Gary J. Vora
Contested Logistics Technologies (LOG): Dr. Robert Mantz
Quantum and Battlefield Information Dominance (Q-BID): Dr. Kevin Rudd
Scaled Directed Energy (SCADE): Dr. Christopher Vergien
Scaled Hypersonics (SHY): Dr. James W. Weber
Our Take: We can already see their inboxes are full with industry reaching out to request meetings and sharing pitch decks.
War Department Boards Merge to Form New Science, Technology and Innovation Board (STIB)
Pete Hegseth approved a major overhaul of the War Department’s legacy advisory boards, directing the merger of the Defense Innovation Board (DIB) and the Defense Science Board (DSB) into the new Science and Technology Innovation Board (STIB). The STIB will maintain two permanent subcommittees:
Subcommittee on Strategic Options – Charged with identifying concepts, capabilities, strategies, and courses of action across the S&T enterprise that rebalance cost and benefit, strengthen deterrence, and ensure U.S. operational dominance.
Subcommittee on National Security Innovation – Tasked with examining and advising on innovation pathways, emerging and disruptive technologies, commercial best practices in strategy and management, organizational design, human capital, decision‑making, and scaling — while leveraging America’s broader innovation ecosystem for national security.
Ernst Responds to Markey’s SBIR Compromise, Narrowing the Distance
The negotiations over SBIR are still serious, still incomplete, but shaping where the two sides are drafting in the same direction.
Markey’s draft aims to be an expansive modernization of the statute, while Ernst’s latest offer is slimmer — more targeted, more time‑limited, and in several contested areas, notably more cautious. Yet slim does not mean static.
The result is a negotiating moment that feels, in the best sense of the phrase, more legible. There is progress. There are also, plainly, a few hard questions left to settle.
The headline difference: permanence versus a three‑year bridge.
Where the texts clearly converge: Phase III as the shared destination.
The “strategic breakthrough” center of gravity — and its unsettled parameters
Markey’s approach: narrower allocation, explicit matching structure
Ernst’s approach: larger ceiling on allocation, different match language
The “mills” debate shifts again: benchmarks, caps — and who bears the burden
A quieter but meaningful convergence: technical assistance becomes more flexible.
Source Docs: Innovate Act | Sen Markey Proposal | Sen Ernst Counter
Our Take: As the two sides work through the differences and details, we operate from the first principles of: The SBIR/STTR program is a valuable program to invest in small business innovation for national security and beyond and must continue. While Congress can legislate intent and constraints, the success and failure of the program still lies with those charged with execution within the Department and Services. The debates over too much funding going to the mills, spreading the pot too thin to be effective, and onerous, ineffective SBIR review boards are tactical issues. Come to agreement on the strategic intent of the SBIR/STTR program and what you value, then track and publish a key set of metrics to measure what matters. If the SBIR leaders within the Services can’t execute a system to achieve those goals, find others who can.
Making the Wrong Things Go Faster at the Department of War
The DoW senior leadership is now headed by people from private capital (venture capital and private equity).
The DoWis in the midst of once-in-a-lifetime changes in how it acquires weapons, software and systems. The new Warfighting Acquisition System rewards speed and timely delivery of things that matter to the warfighter.
But this new system is at risk of making the wrong things go faster.
Acquisition in the DoW is being reorganized how a private equity firm would reorganize a large company. They bring in (or empower) a new operating team, swap executives, change incentives, kill things not core to their mission, cut costs, invest for growth, and restructure to find additional financing.
Organizing by PAEs is a great start, but simply consolidating the parts of the defense acquisition system that were broken under one umbrella organization won’t make it better.
For example, many of these new PAEs are managing their programs by holding monthly reviews of proposed investments and current portfolio performance.
A more productive approach would be to build a different process upfront: a rigorous problem identification and validation phase on the front-end of every acquisition program. The goal would be to:
Consolidate problems that may be different descriptions of the same core problem, and/or
Discover if the problems are a symptom of something more complex.
Then each problem would go through an iterative process of problem and technical discovery. This will help define what a minimum deployable product and its minimum constraints (security, policy, reliability) should be, such as how long the solution would take to deploy, the source of funding for scale and who needs to buy-in.
Our Take: As usual, we agree with the wise Steve Blank. As the new PAEs are established and the Services/Department frame their new post JCIDS requirements processes, it is critical to take a fresh look at the existing acquisition programs, their legacy requirements documents, and new capability needs. They should restructure them to deliver a portfolio of integrated capabilities that solve operational problems.
The Ever-Changing, Unchanged Defense Acquisition System
The defense acquisition system has been and continues to be in a period of great change, both in terms of the laws and processes that govern it and the private sector ecosystem that supports it. Yet broad dissatisfaction in both the legislative and executive branches with how the DoD procures weapon systems persists.
Multimillion-dollar decisions to invest in new defense technology are now being made by private individuals and entities, sometimes with very little consultation with the ultimate customers in the DoD.
While developing new weapon systems without government involvement is one way to speed up the process, it remains to be seen whether this approach will yield the kinds of systems that the joint force needs, or in forms that can be integrated into the extant force.
The iron triangle of any capital project remains a reality for defense procurement; tradeoffs must be made among speed, cost, and quality. The reforms of the 2000s were successful as measured by the number of Nunn-McCurdy breaches before and after WSARA of 2009.
The latest slate of reforms appears to prioritize improving speed, though there is little acknowledgment in either the executive or legislative branches that compromises will have to be made on cost and/or quality to achieve that objective.
The last several decades of acquisition reform have been focused primarily on the cup (process) and less on the coffee (content and execution).
There is no replacement for rigorous attention to strong contracting practices, realistic schedules and cost estimates, and more frequent assessment of where it might make sense to trade capability for speed (or vice versa) on a case-by-case basis.
Congress and the DoD should stop “reforming” acquisition processes and reorganizing offices that acquire defense materiel. What exists is an adequate container for the content of good defense acquisition.
Instead, they should focus leadership time and attention on the content of what the DoD is buying (i.e., where is it appropriate to trade speed for capability or vice versa) and how the DoD is buying it (e.g., realistic schedules and cost estimates, strong contracting practices).
Our Take: We respectfully disagree that major industry investments occur with little Department consultation. Companies investing hundreds of millions of their own dollars in defense technologies engage extensively with Combatant Commanders, Pentagon leadership, and numerous other stakeholders. Those who fail to do so proceed at their own risk. The legacy mindset that the Iron Triangle and Nunn-McCurdy breaches measure acquisition system success must be dismantled decisively. The focus on baselines set after years of analyzing legacy systems—when program knowledge is least mature—should shift to assessing what it will cost, how quickly we can deliver at scale, and how effectively it will address priority operational challenges. The increased mission engineering focus is also indicative that this Department is striving to fund those efforts that move the needle on operational gaps and challenges. We do agree that more hedge investments (to accompany the large MDAPs that dominate the budget) must be pursued. However, the fact that reorganization and consolidation is happening concurrently does not mean that one is less of a priority. One can enjoy the cup of coffee while also admiring the cup.
When to Use (and Not Use) As a Service for Government Space Requirements
There is no policy guidance that can be applied across federal agencies to help officials choose between an as-a-service model or a traditional model—where the government owns and operates a system—for carrying out space missions and functions.
Four operating models are used to describe who owns and operates the capabilities the government uses:
Government-owned, Government-operated (GOGO)
Government-owned, Contractor-operated (GOCO)
Contractor-owned, Government-operated (COGO)
Contractor-owned, Contractor-operated (COCO)
Key Considerations for Operating Model Selection
Inherently Governmental Functions and Closely Associated Functions
Scope and Performance Considerations
Schedule Considerations
Cost Considerations
Growing the Economy
Maintaining Control
Buying Commercial and Capturing Innovation
Recommendations
Determine applicability of as-a-service operating model independently of if the service qualifies as a commercial solution.
Recognize how few space functions under consideration for purchase as a service would meet the threshold set in statute for an inherently governmental function.
Operating model selection should be driven by the same factors that shape all government programs and acquisitions: performance, schedule, and cost.
Consider greater use of hybrid as-a-service models, such as COGO and GOCO, which could offer advantages over unadulterated COCO services or government ownership and operation.
Think twice about presuming a nongovernment market will materialize for the same, or even highly similar, space capabilities required by the government.
Our Take: Clayton’s paper offers valuable considerations that should be integrated into acquisition strategies, training, and tools to expand use of as-a-Service models and use them smartly. We also believe Military Capabilities as a Service is a valuable opportunity across DoD applications. The one nit is that the considerations span far beyond the legacy cost/schedule/performance factors, but also fueling competition, rebuilding the industrial base, scaling and resilience in wartime, harnessing commercial investments and talents, and rapid iteration of new capabilities as he discussed in the earlier section of his paper.
Shareholders: The Defense Industry’s Other Partner 2.0
Of the 20 largest publicly traded defense companies, 60-100% of outstanding common stock is held by institutional investors. Their goal is to earn positive returns on invested capital.
Management of public companies is assessed on how their stock performs against peers and broader market indices.
Corporate Boards of major contractors are diverse and largely have non-defense backgrounds.
Proxy statements provide details on what incentives management can earn if they perform. Stock Plays an Important Role in Incentive Compensation.
Share buybacks are one option that companies can use with the cash they’ve earned.
Other forms of investment are not captured by R&D or capital expenditures.
Laying the Cultural Foundation of Reindustrialization
Efforts to rebuild the American industrial base are gaining real momentum. Public and private investment, renewed interest in manufacturing, and a wave of defense-focused entrepreneurs are helping advance a long overdue shift. Yet despite this progress, there is an underlying issue that is often missed. Reindustrialization is not only a technology, finance, and policy problem; it is also a cultural problem.
For decades, the U.S. moved away from a culture of building.
If the U.S is going to rebuild the American industrial base, we must first restore meaning to the act of building.
Fixing the problem requires rebuilding the cultural foundations that connect thinking and making so that manufacturing and the talent it draws are seen as central to the nation’s future.
How young people imagine their futures.
Industrial Work as a Step Down Rather Than a Path to Success
The U.S. Should Design and Others Should Build
Efficiency as Superior to Resilience
Reversing the cultural narratives that have devalued American manufacturing.
From Factory Jobs to Careers as Builders
From Separation to Integration of Design and Production
From Efficiency Culture to Learning and Resilience Culture
Reindustrialization depends on recovering the belief that building matters and that those who build help shape the future. When industrial work regains its place as a source of identity and contribution, the rest of the system can begin to cohere around it.
The Primes Aren’t the Real Bottleneck in U.S. Weapons Production
Major U.S. weapons programs continue to face long delivery backlogs even as defense budgets rise. The president has focused his criticism on stock buybacks, executive compensation, and financial behavior at large defense primes. This pace is governed less by the financial behavior of Northrop Grumman or Raytheon than by the economic realities of the thousands of Tier-2 and Tier-3 manufacturers that supply them.
These firms are often small, specialized, and capital-constrained, yet they produce the components that determine whether primes can meet their schedules at all.
Primes also have a role in shaping this environment. Contract structures, payment terms, demand signals, and information flow all influence whether sub-tier suppliers can afford to maintain or expand capacity.
The primes don’t control the industrial physics that determines how fast components are actually built. Those constraints live downstream in the network of subcontractors that produce the parts primes can’t substitute easily or quickly.
Tier-2 and Tier-3 defense manufacturers operate in a very different economic universe than prime contractors. They tend to be privately held, thinly capitalized, and are heavily dependent on a small number of contracts. Their margins are narrow, and their access to external financing is limited.
A common response to supply constraints is to suggest that primes should simply find alternative suppliers. In theory, competition solves the problem. In practice, it rarely exists.
Supply chains that appear distinct at the program level often rely on the same handful of sub-tier suppliers.
This convergence undermines assumptions about surge capacity. Funding one program more aggressively doesn’t help if the same constrained supplier supports several others.
One underutilized government lever is cash flow. The Department of Defense already has a range of authorities, from the ability to issue multi-year contracts and advance procurement, to Defense Production Act tools and industrial base assessments. These mechanisms have been applied primarily at the prime level.
Another concrete step would be for the DoD to maintain a regularly updated map of sub-tier dependencies for critical programs, building on industrial base assessments already underway in sectors like solid rocket motors.
The U.S. can look to other countries, such as Israel, to evaluate new ways of thinking for how to strengthen the DIB. Israel’s Directorate of Defense Research and Development funds critical capabilities and components early in their R&D and acquisition cycles, before major programs lock in specific designs.
Cost/Pricing Breakdown Requirements in Firm-Fixed-Price Proposals
Understanding When and Why the Government Still Requires Cost Detail for (some) FFP Awards.
There are a few different scenarios when the USG will ask for a bottoms-up proposal (or one that complies with the DoD Proposal Adequacy Checklist).
Under FAR, Certified Cost or Pricing Data is mandatory unless an exception applies. The two most common exceptions for dual-use, small or non-traditional businesses are competition and commerciality.
For every award the USG makes, the Contracting Officer must determine that the award price is fair and reasonable. Under FAR, the KO typically makes that determination using either price analysis or cost analysis. For FFP contracts, the KO can use price analysis, which does not require a bottoms-up proposal. For cost-type contracts, the KO must use cost analysis, which does require a bottoms-up proposal.
Other Than Certified Cost or Pricing Data. If the KO does not believe they have the necessary information to determine that a price is fair and reasonable, but an exception to CCPD applies, they can request the vendor provide additional information similar to CCPD, but without the certification.
Be prepared; tell a story; use historical pricing or commerciality as the cost element and sub levels; and shape the inquiry.
CCPD is not a requirement for OTs. However, it is not uncommon for the USG to use similar processes and methodologies when evaluating price.
Global Defense Spending to Top $2.6 Trillion in 2026
Global defense spending is expected to reach $2.6T by the end of 2026, well on its way to hitting the $2.9T mark by the end of the decade, per analysts at Forecast International. The $2.6T figure is an 8.1% increase over the $2.4T spent in 2025.
The top 10 defense spenders in 2025 were: U.S., $860B; China, $245B; Russia, $157B; United Kingdom, $80.5B; Germany, $72.6B; Saudi Arabia, $72.5B; India, $60B; France, $58.7B; Japan, $58B; and Ukraine, $53B.
AI Completely Failing to Boost Productivity
Mountains of research as well as cases of workplace deployment of AI have suggested that the tech is far from being ready for primetime.
One notable MIT study found that 95% of companies that integrated AI saw zero meaningful growth in revenue.
For coding tasks, one of AI’s widely hyped applications, another study showed that programmers who used AI coding tools actually became slower at their jobs.
Forrester’s research does predict that AI and other automation tech, like physical robots, will see a hefty six percent of jobs replaced by 2030, amounting to some 10.4 million roles.
“This isn’t a statement on how transformative AI might or might not be. It could have massive effects without necessarily translating to economic gains, a phenomenon known as the Solow Paradox, named after the Nobel Prize winning economist Robert Solow who correctly predicted that by 1987 the effects of the PC revolution can be seen everywhere, except in the productivity statistics.”
Our Take: This is not to say that DoW should back off on their AI surge but rather that DoW customers should recognize that benefits may come in subtler ways that don’t see immediate reductions in need for operators and other functions. AI agents are certainly the future, but their introduction and acceptance may take time to stick - and show tangible gains.
AI a Double-Edged Sword for Cyber Defense, Offense
AI holds great potential to enhance both offensive and defensive operations in the cyber domain, but it remains to be seen which side of the coin will benefit most from the technology.
“The cyber domain is undergoing a shift change where offense is going to come AI-enabled. It has total recall. It’s going to work at a scale and speed no human is capable of addressing. It’s going to be able to coordinate these attacks in ways that we have never seen humans be able to do before. The U.S. must start experimenting with new ways to deter and impose costs in cyberspace on adversaries, who could launch an attack without knowing how effective it’s going to be, and the agents that they use will think, learn and adapt to us at.” Kevin Mandia, GP at Ballistic Ventures.
AI startup Anthropic announced that it had disrupted the first reported AI-orchestrated cyber espionage campaign, assessing with high confidence it had originated from a Chinese state-sponsored group.
The attack on Anthropic was the first revelation that, hey, there is a capability here that our adversaries can use, that can get us to a speed and a scale we haven’t seen before, and the question becomes, what are you going to do about it?
Cyber is asymmetrically in the attacker’s favor because the defender has to be right all of the time, and the attacker only has to be right a small number of times … so they’re not really starting off on a level playing field when adopting AI.
Ensuring the U.S. stays ahead of AI-enabled cyberattacks will require a large-scale diffusion of AI tools for defense across the industry including small to medium businesses that need to adopt that technology.
Senior DOD officials back CYBERCOM 2.0, as Cyber Force debate continues to churn
Advocates of creating an independent U.S. military service focused on cyber argue that the Pentagon’s new force generation model isn’t a sufficient solution for fixing the department’s problems.
The new CYBERCOM 2.0 Force Generation model, rolled out in November, aims to modernize the way the DoD builds and develops digital forces and talent, including by more closely linking CYBERCOM with the military departments to recruit, assess, select, train and retain the nation’s digital warriors.
Core attributes of the new model include targeted talent acquisition; incentives for recruiting and retention; tailored and agile training; tailored assignment management; specialized mission sets; integrated headquarters and combat support; and optimized unit phasing to prevent burnout and sustain readiness.
Pentagon’s New Non-Kinetic Effects Cell Bolsters Gen. Caine’s Goal to Better Integrate Cyber into U.S. Military Operations
Gen Caine has highlighted the important role that digital tools played recently in major operations, like Operation Absolute Resolve and last year’s Operation Midnight Hammer in Venezuela and Iran, respectively.
“The word integration does not explain the sheer complexity of such a mission, an extraction so precise it involved more than 150 aircraft launching across the Western Hemisphere in close coordination, all coming together in time and place to layer effects for a single purpose, to get an interdiction force into downtown Caracas while maintaining the element of tactical surprise. Failure of one component of this well-oiled machine would have endangered the entire mission.”
Leading up to the events in Venezuela, over the last six months, we’ve been developing something new on the Joint Staff called a ‘non-kinetic effects cell.’
This is designed to integrate, coordinate and synchronize all of our non-kinetics into the planning and then, of course, the execution of any operation globally.
In the Air Force, there was always a non-kinetic effects cell at an air operation center, but it usually existed back in a backroom. We’ve now pulled cyber operators to the forefront.
JIATF-401 Announces Updated Guidance to Counter Drone Threats in the Homeland
Key updates to the counter-UAS policy include:
Expanded Defensive Perimeters: The previous “fence-line” limitation has been removed, giving commanders a larger defensive area and greater decision space to protect covered facilities and assets.
Streamlined Threat Identification: Unauthorized surveillance of a designated facility now explicitly constitutes a threat. This, combined with the authority for commanders to make threat determinations based on the “totality of circumstances,” grants greater operational flexibility.
Enhanced Interagency Cooperation: Bolstered by the FY26 National Defense Authorization Act, the policy authorizes sharing of UAS track and sensor data among interagency partners, including the Department of Homeland Security (DHS) and the Department of Justice (DOJ). It also allows for the use of trained and certified contractor personnel as C-sUAS operators.
Clear Authority Delegation: Service Secretaries are now authorized to designate “covered facilities or assets” based on risk assessments, an authority that can be delegated to Service Chiefs to ensure protection is applied where it is needed most.
Avenger Drone Achieves Autonomous Air‑to‑Air Intercept in Exercise
A key test for the future of air combat played out in the skies as a General Atomics MQ-20 Avenger autonomous drone intercepted a crewed aggressor aircraft during a live air combat exercise.
The exercise focused on decision-making, flight control, and airspace discipline, all under realistic conditions spanning miles of airspace and thousands of feet of altitude.
The MQ-20 acted as a stand-in for a future Collaborative Combat Aircraft. Its task was to intercept and engage a human-piloted aggressor aircraft.
During the exercise, the MQ-20 relied on a live Anduril Infrared Search and Track sensor. Unlike radar, this system detects heat rather than emitting signals.
That allowed the drone to locate and follow the aggressor aircraft without revealing its own position.
Once the target was detected, the MQ-20 used onboard computers predicted the target’s flight path and calculated an intercept solution.
From there, the system generated a firing solution and executed a simulated weapon shot. Telemetry data confirmed the outcome as a successful kill.
The ability of autonomy to close on a target using its own logic is a vital step toward building a reliable ecosystem of CCA for the modern warfighter.
Pentagon’s Vetted Drone Program Moves to New Agency
The DoD’s list of approved drone providers — a project known as Blue UAS — is under new management, transitioning from the Defense Innovation Unit to the Defense Contract Management Agency and moving the initiative into a new phase.
In December, the list officially transitioned from DIU ownership to the DCMA’s Special Programs Unmanned Systems-Experimental (US-X), with the introduction of the Blue List Unmanned Aircraft Systems website.
The Blue List team is connecting vendors directly with users through a portal that standardizes how the department views, compares and on-boards trusted small UAS and components.
The result is users in the field getting what they need when they need it, bypassing previous red tape and risk of procuring unregulated components.
What the Cruise Industry Teaches Us About Leading Complex Business
Capacity Alone Creates Nothing
Demand Is Engineered, Not Discovered
Scale Is Not the Same as Strength
Trust Is a Balance Sheet Asset
Resilience Is Designed Before It Is Needed
Disruption Is Energy
Lockheed, Pentagon Ink Plan to Boost THAAD Interceptor Production
Lockheed Martin signed an agreement with the Pentagon to quadruple production of Terminal High Altitude Area Defense (THAAD) interceptors over the next seven years, marking the company’s second such deal aimed at ramping up munitions manufacturing since the start of 2026.
Once finalized, the agreement will allow THAAD interceptor production to grow from its current rate of 96 missiles a year to an annual rate of 400 interceptors.
Lockheed Martin intends to make a multi-billion dollar investment to accelerate munition production over the next three years, including building facilities across five states.
In addition to the Camden factory, Lockheed said it would make investments to improve tooling and modernize more 20 manufacturing sites in Alabama, Florida, Massachusetts and Texas.
“I think we’re going to see some partnership with cash flow terms to make sure that we’re well supported as we make these investments,. I think you are going to see an elevated working capital benefit or operational benefit to offset some of these CapEx expenditures.” Evan Scott, CFO.
Career Opportunity
CDAO is seeking highly qualified Reserve and National Guard officers in the grades of O3-O5 to serve as Military Deputies to the CDAO Senior Representative at each Combatant Command and the Joint Staff.
Other Defense Tech News:
Contractors Racking Up Big Fines for Cybersecurity Violations
When Automation Accelerates War, Identity Determines Victory
How Defense Civilian Training Helps Job Seekers In A Tough Job Market
GSA wants answers from resellers about markups, equipment relationships
Quantum computing is coming fast. The time to secure the supply chains is now
Army Eyes More HADES Jets, But Program Isn’t Full Steam Ahead
A recent Army RFI for up to 11 business jets to be used for the service’s High Altitude Detection and Exploitation System (HADES) program is a good signal, but doesn’t necessarily mean the program’s full steam ahead.
The jet must operate between 41,000 and 51,000 feet above sea level and be able to carry a payload of at least 14,000 pounds while flying 12 hours or more without refueling. The Army has a future objective of up to 14 aircraft.
Eight months ago, the Army was considering cutting the HADES fleet from 12 to six as part of the Army Transformation Initiative.
The current plan is for the service to acquire six production aircraft and three prototypes for the HADES program. The DoD provided three Bombardier Global 6500 jets to SNC for HADES prototypes and SNC purchased another which it aims to turn into a non-prototype.
ATEC Announces Availability of Premier National Test Ranges
ATEC's national test ranges, which are national assets, are available for use by external organizations to support your internal RDT&E activities. To support Army transformation, ATEC is streamlining access for industry partners to rapidly leverage these one-of-a-kind facilities and expertise, speeding capability maturation and delivery outside of traditional T&E programs and channels.
Available Premier Test Facilities include:
Aberdeen Test Center (ATC), Maryland
Electronic Proving Ground (EPG), Fort Huachuca, Arizona
Redstone Test Center (RTC), Alabama
White Sands Missile Range (WSMR), New Mexico
Yuma Proving Ground (YPG), Arizona
Arctic Regions Test Center – Fort Greely, Alaska
Tropic Regions Test Center – Panama and Suriname
Army Looks Beyond Defilade for Precision Grenadier Weapon
Approximately eight years after the cancellation of the Army’s XM25 Counter Defilade Target Engagement system, the service is working toward a new weapon program that provides the ability to engage targets behind obstacles.
A new vision calls for the weapon’s effectiveness in providing organic, close-quarters combat, counter-defilade, and counter-UAS capabilities through a family of ammunition to ranges in concert with the rest of the squad’s battlespace.
Recent program developments have served to support and potentially accelerate the eventual fielding of the weapon. The Army’s xTech Soldier Lethality competition, launched in July 2023, was one such effort.
That program led to two industry finalist teams, one led by FN America and one a partnership between MARS Inc. and Barrett Firearms, with both teams demonstrating their xTech Soldier Lethality solutions between February and April 2025.
In May, the Army announced that the MARS-Barrett team’s 30mm “Squad Support Rifle System” had been selected as the winner of the competition.
The rounds will include: programmable airbursting high explosives; proximity fuzed and point detonating high explosives; and a close quarter battle round.
Meanwhile, multiple industry teams have been conducting and refining their own development activities, resulting in potential precision grenadier solutions that have surfaced across a spectrum from 25mm to 40mm.
Rough schedule identifies the release of the requirements around the 2Q FY26, with the issuing of an OT Authority award late in the fiscal year.
Army to Award Hanwha Defense USA Lease at Pine Bluff Arsenal
The Army has selected Hanwha Defense USA for an enhanced use lease at Pine Bluff Arsenal in Arkansas as part of a broader effort to modernize the munitions supply chain and strengthen domestic production of critical energetics.
Hanwha plans to invest about $1.3B in the project, which is expected to generate roughly 200 skilled jobs. The lease would support the construction and operation of a new facility focused on producing key ingredients used in explosives and propellants, materials that underpin munitions such as 155mm artillery rounds.
The partnership reflects a model the Army intends to use to reinforce both commercial and organic industrial base capacity.
MAPS Industry Day Insights
The MAPS Industry Day confirmed something big: the government is creating a new category called "Commercial Sector Vendors" — companies with zero federal contract experience in the last four years.
Our Take: We have some thoughts about this contract and some others like it that we will write about later.
Other Army News:
Army’s CamoGPT won’t be phased out as Pentagon embraces more commercial genAI products
Army and AMTEC unveil new production line and testing range in Wisconsin
Army Engineers Find Faster Way to Keep Patriot Air Defenses Online
Theater Army Planning Questions for Joint All-Domain and Multi-Domain Operations
CNO’s APEX Defense Keynote
Over the next few weeks, I will be unveiling the U.S. Navy Fighting Instructions – the Navy’s newest strategic guidance to the Fleet.
Underpinned by my priorities of Foundry, Fleet, and Fight the Fighting Instructions are designed to deliver homeland defense, sustain our global network of deterrence, and preserve our national prosperity.
The Fighting Instructions is our Navy’s answer to a simple but daunting question, which is: “How do we ensure we can fight and win across the spectrum of conflict, under conditions we cannot entirely predict against adversaries who are increasingly capable, innovative, and aggressive?”
Implementation of a full-spectrum Hedge Strategy.
Hedge Strategy accepts fiscal, industrial, and operational realities—and still demands a Navy that is lethal, agile, responsive, and flexible. It balances cost-effective, scalable, risk-worthy mass with the most advanced multi-mission platforms we can build and sustain while taking stock in the likelihood of pacing scenarios and the severity of risk that’s attached.
The only way to achieve this end state is by creating a repeatable process that is built around our standard model while leveraging modular, scalable, and adaptable units of high and lower-grade capabilities that can be tailored and respond decisively to any number of scenarios.
What Hedge Strategy avoids is a brittle, single-purpose force that is either over-built for the high-end fight and under-used day-to-day or optimized for low end crisis and overmatched when it counts.
Initiatives: Global Maritime Response Plan and Combat Surge Ready defining a level of readiness for our battle force throughout the various stages of our force generation cycle.
The Navy Warfighting Concept and new Navy Deterrence Concept codifying not only what and how we fight but importantly, who and how we deter.
The concept of Tailored Forces and Tailored Offsets – groupings of manned and unmanned platforms, robotic and autonomous systems, and logistic nodes – will be fundamental to operationalizing the Hedge Strategy.
Related: Top Navy Official Details New Hedge Strategy and CNO Outlines Vision for Unmanned Systems in Navy’s new Hedge Strategy
Hat Tip to Mike Brown and RADM (Ret) Loren Selby for championing the Hedge strategy for years. Read: Revisiting the Hedge Strategy with Renewed Urgency
Navy’s Second Ford-Class Aircraft Carrier Kicks Off Sea Trials
CNO Caudle: Navy Must Launch F/A-XX Program Now to Penetrate Iranian Airspace in 10 years
The Navy needs to jumpstart its F/A-XX stealth fighter program, CNO ADM Daryl Caudle said, because the rapid spread of advanced anti-aircraft systems means adversaries like Iran are increasingly able to shoot down the Navy’s current F-18s.
Only an aircraft with the full package of capabilities envisioned for F/A-XX — stealth, range, EW, and the ability to control flocks of unmanned loyal wingmen — can reliably penetrate future air defenses.
Of the additional money, $897M is dedicated to F/A-XX. That plus-up came with a congressional mandate that the Pentagon use the money to award a development contract aimed at accelerated Initial Operational Capability.
I know these things are expensive and the defense industrial base is compressed, but we have got to figure out how to walk and chew gum here with aircraft.
If I don’t start building that immediately, you’re not going to get it for some time.
The Navy wants the F/A-XX to bring a complex package of new capabilities to the carrier deck, including more advanced stealth than the service’s current F-35s, which are replacing the oldest F-18 Hornets. It’s expected to have 25% more range than than the F-35C variant. It’s also expected to have more sophisticated jammers than the current EA-18G Growler, and the built-in capability to control multiple unmanned loyal wingmen
A New Challenger Emerges in F/A-XX Race With Mach 4 Fighter Concept
Stavatti Aerospace has put forward an alternative vision for the Navy’s Next Generation Air Dominance (NGAD) program, presenting a new aircraft concept aimed at replacing the F/A-18E/F Super Hornet in the 2030s.
Dubbed SM-39 Razor, the aircraft features a low-observable triple-fuselage layout, a configuration intended to help limit wave drag during sustained supersonic flight.
The SM-39 will be offered in three versions: single-seat, tandem seat, and fully autonomous, all built around a modular cockpit that supports manned and unmanned operations.
Ships or Munitions? Clarifying the Discussion on USVs
Many strategists, myself included, believe that unmanned surface vessels could be part of an approach to help the Navy maintain an edge over its competitors. Unfortunately, there is little agreement on exactly what they should do.
The discussion over how the Navy should employ unmanned surface vessels would benefit from drawing a distinction between munitions-like surface platforms that behave like mobile mines and ship-like unmanned surface platforms that serve as low-end fleet combatants.
Delineating between the two types of vessels would help point out the pros and cons of each, which would then help strategists understand the best ways to employ them against particular threats.
When many people refer to USVs, they are describing ship-like surface combatants the size of a patrol vessel, a corvette, or a small frigate. To date, a significant portion of the Navy’s USV development efforts have been on these types of platforms.
Many who favor building ship-sized unmanned surface vessels believe that they would be an economical solution to growing the fleet, with the idea of “deconstructing” expensive units.
The mine-like nature of unmanned surface munitions gives them several unique advantages. Among these are the greater range at which they can be employed, their extreme expendability, the prospect of their mass production, and their survivability against missiles.
Unmanned surface munitions are an example of precise mass, and as such, they have a lower barrier to mass production than unmanned ships.
In the Western Pacific, given the mission and the threat environment, unmanned surface munitions are better suited for this theater than missile-shooting unmanned ships.
Unmanned surface munitions are better suited for a sea denial mission against an adversary with a missile firepower advantage.
The first step to unlocking their potential asymmetric advantage is to make the distinction between the two types of systems. A more precise taxonomy could clarify the functions that each type of USV is meant to perform and help identify the roles that each should play in the sea denial mission.
L3Harris Wins Navy Deal for Marine Corps Precision‑Strike Program
L3Harris secured a Navy deal to develop Red Wolf vehicles for the Marine Corps’ precision-strike program.
The Red Wolf is a long-range, precision-strike missile capable of hitting moving targets including ships at distances beyond 200 nautical miles.
Last July, L3Harris unveiled two new long-range missiles, Red Wolf and Green Wolf, aimed at providing lower-cost strike options as the DoW replenishes weapons stockpiles and strengthens its deterrence posture toward China in the Pacific.
Our Take: Props to L3Harris for this win. This contract may be the culmination of a longer-term development program with the Navy (NAVAIR) under its Precision Attack Strike Missile (PASM) program. The details aren’t clear on how much IR&D L3H invested in this missile to get it to maturity, but what is clear is that it has undergone multiple iterations since its key November 2024 test - showing that has some level of modularity and hopefully scalability. The Navy needs more cost-effective multi-role missiles (this weapon does both anti-ship and ground missions).
Washington’s Misplaced Shipbuilding Obsession
In a year dominated by sharp partisanship, numerous lawmakers improbably united around the revival of America’s commercial shipbuilding industry. Congressional legislation that would channel billions into shipyard subsidies and new trade restrictions attracted scores of cosponsors.
Expectations of a genuine American shipbuilding renaissance should be kept in check.
The U.S. is ill-suited to quickly transform from a virtual non-participant in commercial shipbuilding to a competitive producer of large cargo vessels. More likely is another round of costly subsidies, continued shipbuilding dysfunction, and little progress toward addressing the country’s key maritime challenges.
No major U.S. industrial sector has underperformed as consistently and predictably as commercial shipbuilding.
Constructed almost entirely for a captive domestic market, U.S.-built commercial vessels feature prices that bear no semblance to world levels. And prices are spiraling ever higher.
Construction timelines are similarly uncompetitive. The last U.S.-built containership delivered required approximately 40 months from the laying of its keel until its delivery in 2023. South Korea can do that in < 6 months.
The centerpiece of today’s shipbuilding revival effort is the proposed SHIPS for America Act, which relies on new subsidies and protectionist measures as its key pillars. The act would undoubtedly stimulate the construction of some new ships.
American shipyards struggle to find sufficient labor to meet their current output.
U.S. shipbuilding facilities are antiquated.
U.S. shipyards face inflated input costs.
A More Purposeful Approach is Needed
Ensure continuous production.
Leverage allied shipyards.
Reform or repeal U.S. coastwise laws.
The U.S. is nowhere close to becoming a competitive builder of large oceangoing cargo vessels, either under current conditions or under any plausible combination of subsidies or mandates.
The structural barriers are overwhelming, including outdated shipyards, exceptionally high input and labor costs, and a workforce too small to sustain such an industry.
What U.S. maritime policy needs instead is a clear-eyed assessment of its discrete problems and targeted strategies to address each one.
Other Navy News:
F-35 Quarterbacks and CCAs: The Behavioral Path to Sixth-Generation Airpower
The concept of fifth-generation air warfare was clearly articulated by former Secretary of the Air Force Michael Wynne which emphasized a fundamental shift from platform-centric thinking to network-centric operations, where stealth, sensor fusion, and information dominance would define a new era of air combat.
In contrast, the sixth-generation concept remains frustratingly opaque.
Various characteristics have been proposed, adaptive cycle engines, enhanced range, advanced materials, open architecture, but these represent incremental improvements rather than a transformative operational concept.
One element has emerged with increasing clarity: the crewed fighter operating in a “wolfpack” configuration with Collaborative Combat Aircraft (CCAs).
This human-machine teaming approach represents a genuinely revolutionary shift in how air power is generated and applied.
Yet here is the critical insight that defense planners are beginning to recognize: the F-35 can be reworked to quarterback such wolfpack formations.
Rather than waiting for an entirely new airframe to deliver sixth-generation capabilities, we can evolve existing fifth-generation platforms.
The aircraft’s sensor fusion capabilities, integrating data from its AN/APG-81 AESA radar, electro-optical targeting system, distributed aperture system, and electronic warfare suite, create a comprehensive battlespace picture that exceeds what any single pilot can fully exploit.
This information richness, initially designed to enhance situational awareness for the pilot, becomes the foundation for commanding autonomous loyal wingmen.
The F-35 already processes and distributes more information than a single human can utilize; extending that processing to coordinate unmanned systems represents an expansion of existing capability rather than a fundamental redesign.
The CCA concept emerged from recognition that exquisite manned platforms, operating alone, cannot achieve the mass necessary for high-intensity conflict against peer adversaries.
The economics are straightforward: a single F-35 costs approximately $85M; a CCA cost between $20-30M. This cost differential enables force multiplication.
Instead of four F-35s operating independently
Imagine four F-35s each commanding two to four CCAs, creating a force of 12-20 platforms with substantially greater capability than the original four.
They enable entirely new tactical approaches by accepting risk that cannot be imposed on crewed aircraft.
CCAs can penetrate dense air defense networks to serve as forward sensors, suppress enemy air defenses through saturation attacks, or provide deceptive electronic warfare signatures.
Bottom Line: This realization forces a reconceptualization of generational transitions in air warfare. Previous generations were defined primarily by platform characteristics: fourth-generation fighters introduced fly-by-wire controls and beyond-visual-range missiles; fifth-generation platforms added stealth and sensor fusion. The leap to sixth generation, however, is better understood as behavioral or capability enhanced rather than platform-based transition. It’s defined by how forces operate, not what individual platforms can do.
Our Take: While most acknowledged the value of CCAs as a force multiplier, the logic espoused here calls into question the real utility of 6th gen aircraft programs. While range is certainly one platform characteristic that is key (adaptive engines are more than evolutionary in our view) and survivability to operate closer is another (for key kill chains), one must question this from a value perspective and how far we could get to execute 6th gen capabilities fully utilizing an F-35 + Low Cost CCA mix at scale. This equation could get even more interesting if you add in new space capabilities like GMTI and AMTI (which are still on a journey) as well as pervasive ISR to augment this force mix and no longer justify two new incredibly expensive fighter programs.
B-21 Raider Future Insights from Global Strike Command’s Top General
The B-21 Raider bomber is one of the Air Force’s most ambitious weapons programs, designed to carry out deep-penetrating nuclear and conventional strikes over heavily defended skies and other missions the B-2, was never envisioned as doing.
One of Gen. Stephen L. Davis’s main tasks is guiding the development of the Raider of which 100+ are currently slated for procurement.
The program remains a benchmark of acquisition and has validated the value of the digital engineering that went into it from the beginning.
I can tell you that the penetrating global strike platform we are building and will get with the Raider is amazing.
What I can say is that it will continue to build on the capabilities of the B-2. As you know, in the environment and the places where it might operate, those people are improving their defenses, and likewise, we have to improve our capabilities.
It will be more connected than the B-2 in order to do its penetrating global strike mission - so one thing you could add to the B-21 family systems is the F-47 6th-generation fighter which it will be paired with under certain circumstances.
It’s certainly possible in the future that CCAs might become part of that family of systems - the long-range strike nature of the B-21 would limit the ability to use some of those platforms as they don’t have the extended flight envelopes.
Long-range strike contributes to every important mission set including maritime.
Our Take: Not a very revealing interview. B-21 will be better, that’s the hot take.
Air Force Eyes Improved Comms with Bombers After Midnight Hammer
To ensure future missions such as last summer’s strikes on Iranian nuclear facilities can succeed, the U.S. Air Force must improve the way it securely transmits critical information with bombers and other aircraft.
Midnight Hammer was a success but if the Air Force is going to maintain that kind of advantage, it has to ensure its command-and-control networks and communications architectures are able to securely transmit critical instructions and status updates to and from bombers and other aircraft.
One caution is the Air Force needs to take care that giving combatant commanders a direct pipeline to the cockpits does not lead to them making operational decisions and eroding the authority of air crew commanders.
New Air Force Sustainment Center 2025 Strategic Plan
The Art of the Possible (AoP) is the fundamental basis of how we operate across the Air Force Sustainment Center (AFSC) . Our success is the foundation of the warfighters’ success, whether it is ensuring our nation’s nuclear deterrent, maintaining air supremacy, fueling the fight, or delivering hope and saving lives .
Our Take: While this is a fine standard Air Force Strategic Plan in the grand tradition, one day I’d love to see one written in normal language and not by a hired consultancy who overloads the buzz words and frameworks. That being said, there are some nuggets in here particularly the breakdown of the different processes and their current priorities.
DAF PAE C3BM Leader Confirmed for Third Star
The U.S. Senate recently confirmed the nomination of Maj. Gen. Luke Cropsey, the DAF’s Portfolio Acquisition Executive for Command, Control, Communications and Battle Management, for his third star as the Military Deputy, Office of the Assistant Secretary of the Air Force (Acquisition, Technology, and Logistics) at the Pentagon.
Our Take: Bravo!
Boeing Reports $565M Loss on KC-46 & Looks Forward to Repricing
In an earnings call with investors, Boeing chief executive Kelly Ortberg acknowledged the loss is “disappointing,” but said the company is seeing encouraging signs in the aircraft’s operational performance that bode well for the program’s future.
Jay Malave pointed to the Air Force’s recent order of 15 more KC-46s as a positive development that contributed to Boeing’s $15B in orders during the quarter.
Boeing said the KC-46 charges were driven by higher supply chain costs and production support expenses at its facility in Everett, Washington.
Most of the KC-46’s loss was due to higher costs on the 767 airframe that provides the basis for the tanker, which does not reflect on other Boeing defense programs.
Boeing is pushing for higher quality levels and engineering support at its Everett factory, where KC-46s are made, and saw the amount of work that needed to be redone drop by 20% in the latter half of 2025.
“This has been a bad contract for the last decade. As we enter into a new opportunity where we get to reprice, we want to make sure that we … ensure it’s a fair contract and we can make money.” Kelly Ortberg, Boeing CEO
Our Take: It’s good to see that some of the improvements being made on the KC-46 will potentially have beneficial crossover effects on other lines. This is a good reminder to acquisition executives why fixed-price contracts are the way to go in most cases, preferably with multiple phases and milestones to avoid this debacle. 100% though if this had been a cost contract, the government would have eaten all these costs and Boeing may not have been quite as thorough in its corrective actions.
Air Force Patent Holiday Offers Businesses Inventions for Free
The Air Force Research Laboratory is offering free licenses for dozens of its patents, including some for secure microchips, 3D-printable “energetic compounds” for use as propellants or explosives, and powerful magnets that are less reliant on rare earth metals. Among the available patents for license are:
A patent family in secure logic devices, or microchips, guarded against hardware Trojans… malicious modifications made to the hardware circuit during the manufacturing process that can get triggered remotely.
A family of advanced materials patents for energetic composites—alloys that can be used as propellent or explosives. Uniquely, the ARFL-developed alloy is stable enough to be 3D printed, meaning shaped or other special explosive charges can be made easily and safely.
The third patent is for powerful permanent magnets for use in converting electricity into mechanical movement, or vice versa, for motors and related applications. AFRL developed a method for making these magnets that requires much less of the scarce minerals known as rare earth metals.
Readiness Is ACC Commander’s Top Priority, But Not His Sole Focus
Readiness and sustainment are clear priorities for ACC boss Gen. Adrian “Elmo” Spain, but he has three other focuses too: Adapting to the strategic environment, modernizing for the future, and empowering leaders at the operational level.
Spain said the results of decisions made over the past decade mortgaged future readiness to pay for near-term and modernization bills.
The increased risk to the force must now be paid down, he said, to ensure today’s force is ready to fight tomorrow.
There is even a clear willingness to apply resources against the problem, he added. But that still leaves one critical ingredient: time.
The No. 1 shortfall is spare parts, but the problem is that most of those parts aren’t sitting on a shelf waiting to be paid for - they have to be ordered, manufactured, and delivered.
In some cases, the supply chain backups are complex enough that it will take years to solve.
Three Main Focus Area Details
Adapt to the strategic environment. Air Force operators cannot expect to operate with impunity from bases that rarely come under attack. Deployed units must also be able to execute Agile Combat Employment, a concept for dispersing to smaller, remote operating locations.
Bring the future forward. When new capabilities are provided to Air Combat Command, Spain said, “I have to be able to catch it normally, get an operational capability very quickly. … Are the people prepared to receive it? Is the infrastructure in place to support [it] at the base?”
Empowered leadership. “I want to push down authority to the lowest possible accountable level of expertise. I want to push down authority to the right person who needs it at the right time and who can own the risk of using it. And that’s different than where we’ve been for the last 30 years. We’ve pulled a lot of that stuff up. We have to have leaders that are comfortable taking risks without looking over their shoulder.
Our Take: Fantastic focus areas. One point that is not noted is that when supply chains are this fragile, one great risk mitigation is to move quickly to a new similar capability that is not as stressed. The Air Force is not good at this and has a lot resting on legacy systems.
AFRL Multiple Award Contract (MAC) IDIQ
The AFRL AMAC is designed to streamline the acquisition process for a wide range of science and technology (S&T) needs across various domains, including air, space, cyberspace, and electronic warfare - and support both basic and applied research, data science, technology development, and integration of military capabilities.
Related Article: AFRL Seeks Offers for $10B S&T Research Multiple Award Contract
Our Take: We have some thoughts about this contract and some others like it that we will write about later.
SpaceX Launches GPS III-9 Satellite for Space Force
Our Take: Hats off to Col Barnas and the Deltas for a successful launch of the 9th GPS III satellite. We need more of these - and the FY26 approps bill adds two more.
The New Combat Forces Command (CFC)
The newly established CFC rebranded from the aptly and perfectly named Space Operations Command. Mission Delta and Squadron logos below.
Space Force Program Office Turns to New Acquisition Tools to Leverage Commercial
Space Force leaders have been saying for months that they are uniquely prepared among the services to embrace the Trump administration’s acquisition reforms.
Now, officials from PEO BMC3I, are implementing some of those reforms through a Commercial Solutions Opening—a contract vehicle that can be used to buy a wide range of innovative off-the-shelf technologies.
At a Jan. 23 industry day, those officials said they would reopen a Commercial Solutions Opening called KRONOS focused on three “areas of interest:” battle management, regional global command and control, and space intelligence.
Some of the changes entailed by a CSO “might make people uncomfortable” as the in the current system, for example, there are lengthy “blackout periods” when contracting officials cannot talk to vendors, designed to ensure buyers aren’t being influenced or suborned.
By the time the proposals are evaluated, an award is made, and the post-award possible challenge period is over, “it’s been about 18 months where I’m not talking to industry, and in software, that’s three generations.”
The CSO allows the program to never, ever have a blackout period with industry.
The CSO was designed to be “the on-ramp for full stack solutions to integrate into the operational baseline.”
The government is also not going to be the integrator. We’re looking for full stack solutions, and what that means is we want to be the Integration Manager, but we want to allow industry to bring that full stack solution to bear.
“The KRONOS CSO is jumping off the software pathway cliff. We are all in. The program will show the full power of the software pathway. I don’t want to buy code in this model.” A static codebase is useless, because it quickly becomes outdated. Actually, a static codebase quickly became worse than useless because maintaining it is a burden, and I don’t want to have to bear that burden.”
Our Take: BRAVO! This is the mindset that is needed.
SPACECOM Chief Cites Army, Marines as Models for Expanding On-Orbit Warfighting Exercises
Gen. Whiting, commander of US Space Command (SPACECOM), called for a foundational pivot to maneuver-based space operations to echo how the rest of the Joint Force fights — including increased investment in enabling technologies such as refueling, repair and on-orbit logistics, as well as new scaled-up exercises.
He cited the core Marine Corps doctrine (MCDP 1) of “shattering enemy cohesion through rapid, focused, and unexpected actions” as a model for where space warfighting needs to go.
He added that because size of SPACECOM’s area of operations is huge, making a maneuver warfare a reality requires “sustained” logistics based on-orbit.
Whiting said he has seen forward movement in demonstrating the value of maneuver capabilities such as rendezvous and proximity operations, refueling and responsive launch, including to the Space Force.
The Victus series of activities that the Space Forces has demonstrated to show the rapid launch capability, the ability to put things on orbit quickly,” he said. “That’s a part of this story, because we want to be able to replenish capability.”
Whiting also used his Space Mobility speech to introduce SPACECOM’s nascent “Apollo Maneuvers” exercise concept, based on the Army’s 1941 Louisiana Maneuvers in preparation for World War II.
These exercises would involve Guardians undertaking large-scale satellite movements, responsive launch activities, and “spectrum maneuvering” operations.
He said it will take “a few more months” to hone a SPACECOM concept for such an exercise campaign, but that the Apollo Maneuvers series could launch in 2027.
Our Take: Yes! This is what we have been preaching and why we’ve been so concerned at the slow pace the Space Force has been embracing ISAM concepts. The Space Force builds satellites today whose lifespan is almost entirely driven by fuel (many of the sensors and systems live well beyond their design life). In a conflict where adversary assets are lasing, jamming and possibly using kinetic systems to degrade our capabilities - they will need to move. Moving cannot equate to suicide when those assets are needed to support an array of air, ground and maritime operations where lives are on the line. Maneuver-Based Space Operations has to be the future and every SV launched needs to have the ability to be refueled and serviced in orbit - unless they are deemed truly attritable and are proliferated.
Space Force Set to Choose Contractors for Next-Gen GEO Spy Satellites
The U.S. Space Force is closing in on its first contractor selections for a next-generation geostationary surveillance program that could reshape how the Pentagon buys some of its most sensitive satellites.
Officials said last week that the service plans to select satellite manufacturers as soon as March for the Geosynchronous Reconnaissance & Surveillance (RG-XX) program, an effort to build a new constellation of reconnaissance satellites using commercial offerings rather than bespoke military designs.
Leaders framed RG-XX as a test case for the Space Force’s push toward a “commercial first” acquisition strategy.
The program is widely viewed as the likely successor to the Geosynchronous Space Situational Awareness Program (GSSAP).
GSSAP satellites perform some of the military’s most demanding space domain awareness missions, tracking and characterizing objects operating near the geostationary orbit (GEO) belt roughly 22,000 miles above Earth.
Those spacecraft are often described by officials as “exquisite” systems: highly capable, custom-built, and expensive, with only a small number on orbit.
The program office plans to tap more than one company and expects the constellation to be significantly larger than GSSAP.
“The number of satellites in the first RG-XX order will depend on available funding and vendor cost proposals. GSSAP has provided us with a phenomenal capability. It is very much a high demand asset doing a lot of exquisite and capable work. What we’re trying to do with RG-XX is look at the opportunity to harness a lot of change in the defense industry since we started the GSSAP program. Long term strategy, it is possible that RG-XX can really take on most of the majority of that mission, but it’s not going to be the exact same thing in the exact same way.” Col. Bryon McClain, PEO for Space Combat Power
What ‘Commercial Space’ Really Means Depends on Who’s Buying — and Why
Governments on both sides of the Atlantic routinely say they are “going commercial” in space, but a new study argues that the phrase has become so elastic it risks obscuring what public agencies are actually buying, and why.
A report published Jan. 28 by the European Space Policy Institute and Aerospace Corporation’s Center for Space Policy and Strategy examines how the United States and Europe define and use commercial space procurement in practice.
Its conclusion is that “commercial” has become a catch-all term applied to everything from open-market data purchases to government-anchored development programs where the state remains the only customer.
Both the US and Europe are expanding their reliance on private space companies, and the report finds that they are doing so for different reasons and through different procurement cultures.
U.S. agencies have increasingly used fixed-price contracts and competition to push cost and technical risk onto industry.
European governments more often pair commercial language with strong public control, motivated by industrial policy, sovereignty and strategic autonomy.
The report divides commercial procurement into three categories.
“Commercial-Lite” programs leave the government bearing most of the cost and risk, even if industry plays a larger role than in past bespoke developments.
“Commercial-Led” programs shift more design authority and risk to companies but rely on government support such as milestone payments, infrastructure access, or guaranteed demand — to de-risk development.
“Purely Commercial” efforts, which the authors note are still relatively rare in space, involve governments buying off-the-shelf services that companies already sell to other customers.
Without clearer definitions and better alignment between policy goals and contract structures, the authors warn, governments risk misjudging outcomes and overstating how market-driven their space programs really are.
Our Take: Well sure there is some nuance about the level of involvement that can be expected depending on the commercial market for that capability. Certain high-end sensors may be overkill and too expensive for broad commercial use even if they have a correlated capability that can support mining exploration or farming etc. We’re not sure that anyone needs to lose sleep over these distinctions. This is a dynamic space that will change. Sensors will become both more sophisticated and cheaper making dual-use more probable. Launch costs with greater competition are likely to make it cheaper and cheaper to launch. The key is involving the commercial sector heavily to maximize their contributions that can support the government timeline.
Space Command to Bring Commercial Firms into Classified Wargame on Nuclear Threats in Space
Space Command will, for the first time, invite representatives from commercial space companies to take part in classified wargames focused on sensitive national security scenarios, underscoring the increased integration between military and commercial space infrastructure.
The initial exercise will examine how the United States would respond to the potential deployment of weapons of mass destruction in space, a scenario he described as “a future that none of us want to happen.”
Gen Whiting said the idea for a commercially integrated tabletop exercise was driven by reports that Russia intends to field a nuclear weapon in orbit.
Space Command already works closely with commercial operators because much of today’s space activity, and much of the infrastructure the military depends on, is owned and operated by private companies.
Whiting said bringing those firms directly into classified planning discussions is a logical next step.
The exercises are set to begin in March and will be held quarterly with a select group of commercial partners.
Our Take: This is a great step forward. Improved integration between cleared commercial companies and the Space Force is a mutual win.
GAO Flags Risks in Space Development Agency’s Missile-Tracking Satellite Program
GAO is warning that the Pentagon’s ambitious effort to overhaul missile warning and tracking from space is moving faster than its underlying technology and management practices can support.
In a report published Jan. 28, they called on the Space Development Agency to be more “realistic and transparent” about the risks facing its plan to deploy a large constellation of satellites in low Earth orbit to detect and track missile threats.
GAO said the program faces considerable risk because SDA is pressing ahead with successive satellite procurements while overestimating the maturity of critical technologies needed to deliver operational capability on schedule.
The report focuses on the portion of the constellation known as the Tracking Layer, which uses infrared sensors to detect missile launches and follow missiles through flight.
GAO has issues with the tranche-based approach saying that SDA continues to award new tranche contracts on a fixed cadence without maintaining an overarching, architecture-level schedule that shows how delays in one tranche could affect the constellation as a whole.
At the same time, GAO said the Pentagon lacks a reliable estimate of what the full missile warning and tracking architecture will cost over its lifetime.
GAO also raised concerns about how SDA defines and validates requirements for the Tracking Layer - not having sufficient collaboration with the combatant commands that would rely on the satellites for missile warning and tracking, leaving warfighters with limited insight into what capabilities will be delivered.
GAO said SDA justified its technology readiness assessments by pointing to the availability of commercial products used in Tranche 1 and Tranche 2. But GAO found that many of those systems required significant modification.
GAO also found problems in the ground segment, which is responsible for processing and distributing missile tracking data saying the ground contract underestimated the scope of work and was “plagued from the start by confusion and misunderstandings about project scope and technical requirements.”
The Tracking Layer is expected to play a central role in the Pentagon’s planned Golden Dome missile defense system, which aims to protect the continental United States against ballistic, hypersonic, and cruise missile threats, as well as certain aerial threats.
Related Article: SDA must be ‘more realistic’ about real risks in pricey satellite Tracking Layer effort: GAO
Our Take: Having read the entire report, there are some concerning practices that need to be addressed. We are less concerned about the long-term cost estimate that details every requirement but there should be estimates to understand the long-term maintenance costs, especially for the ground segment.
Below are some of the more concerning snippets:
One contractor told us that if it had not won a T2 contract, it would not have bid again because it would be too far behind the learning curve to successfully field the number of satellites required for T3 and beyond.
Another contractor told us it did not intend to bid on any further work because the contractor could not reuse enough of its own designs to satisfy internal profitability.
SDA told us it relies on informal contractor technology readiness assessments to determine maturity. In SDA’s T1 and T2 Tracking Layer documentation from August 2024, SDA asserted that prior to T1 and T2 initiation, tracking satellites had demonstrated TRL 6 and 7, respectively. However, this was not accurate.
SDA awarded a contract to Raytheon for the additional orbital plane to enhance the ability of the system to cover the Indo-Pacific, in February 2023, but by the end of the year, Raytheon submitted a request to terminate the contract because the company had underestimated the complexity of the system development.
Despite the Warfighter Council charter indicating the council’s collaborative process, combatant commands said that council meetings are comprised of an SDA presentation rather than an interactive dialogue among council members, leaving members relegated to listening.
Space Force Probably Needs Twice as Many Guardians, Vice Chief Says
The number of operational U.S. military satellites has nearly doubled since the Space Force was created in 2019. Now its leaders want to double the size of the service itself.
The Space Force, which consists of about 10,000 guardians and 5,000 civilians, is adding about 500 troops a year—but that’s not enough according to leaders.
That’s because the newest branch of the service has seen the number of satellites under its control grow from 225 at its founding to 515 today.
Some of the new personnel are working with the Pentagon’s combatant commands, where the Space Force has been catching up with its elder siblings in establishing service components to help the warfighting commanders.
This week, the service and U.S. Southern Command held a ceremony designating the new Space Forces-Southern, which followed the creation of components in Indo-Pacific Command, Central Command, Africa Command, and European Command.
It also established subordinate units focused on Japan and Korea.
Service officials also have aspirations to stand up a Space Force Special Operations component command.
Our Take: The Space Force has sadly lost its way. In 2022, Gen Raymond set a great vision for a military service that would be lean and mean - with a heavy focus on being a digital service that minimized the legacy structures of the Air Force and kept a light management footprint. Throw all that out the window: The Space Force is in empire building mode now where more is better, and technology is talked about way less than modeling the org structures of other services. If Space Force was less worried about having a service component at every combatant command and geographical location, it wouldn’t need to surge its workforce. If it was adopting digital tech at scale, it would be able to lean how many operators it needs - and maybe be able to staff its growing empire without additional help.
SpaceX is the example here. They manage ~10,000 satellites (way more than the SF) and execute roughly 275 daily maneuvers using a staff of less than 800 employees. They do it leveraging advanced AI and automation for both prediction and execution. The Space Force is way behind in this area and had seemingly little focus on it. One reason could be that in “empire mode” reduction of personnel is the opposite of what leadership wants.
Other Space Force News:
Where’s All That Golden Dome Money Going? Lawmakers Want to Know
Lawmakers are done asking how the Pentagon is spending $23 billion allocated for the Golden Dome missile-defense program. Now they’re writing their queries into law.
In the annual defense appropriations bill, House and Senate appropriators wrote a mandatory provision to provide complete budgetary details and justification of the $23B in mandatory funding” provided by the reconciliation bill.
Lawmakers said they haven’t received a master deployment schedule, cost schedule, performance metrics, or a finalized system architecture for the project.
Starting in 2028, the OSW Comptroller would be required to submit a separate budget justification volume annually detailing program descriptions, justifications, and requested funding for the initiative.
The provision would also require Gen Guetlein to provide quarterly updates to congressional defense committees “detailing budget execution and the status of ongoing Golden Dome activities to achieve initial operational capability by 2028.
Trump’s Golden Dome Missile Shield Marks One Year with Little Progress
One year after its launch, Golden Dome has made little visible progress, bogged down by technical disputes and concerns over space‑based components that have delayed the release of billions of dollars.
According to two U.S. officials, work to finalize the architecture of the missile defense shield is still underway, and large‑scale execution of funds has not begun.
The money is available, the officials said, and significant amounts could be released in the coming days once key decisions are made.
One source of delay has been internal debate over classified space‑based equipment, one of the officials said.
A defense industry executive said the systems under discussion likely involve communications standards.
Another executive said they could be anti‑satellite capabilities, raising questions about how such weapons would align with a defensive missile shield.
Much of the past year had been consumed by security reviews, staffing decisions and the approval of complex plans.
Golden Dome Is the Roadmap to the Future of Defense Contracting
The Department of War sees Golden Dome as a high-stakes testing ground for a radical ecosystem model of collaboration between the defense industry, Silicon Valley and the federal government.
Speed, interoperability and sovereignty are the new measures by which success will be measured.
Leaders who continue to rely on ‘process-as-a-product’ will find themselves being left behind. Thriving in this new era requires a fundamental shift in strategy.
CEO’s need to prepare their organizations for working within a mission-based portfolio environment, rather than a program office.
Executives will need to provide a clear focus on how their company is contributing to the health of the entire portfolio’s performance, rather than checking off on a narrow set of requirements.
Leaders of companies involved with Golden Dome need to realize that commercial solutions are now the default, which radically alters the calculus for innovation and compliance.
The days of cost-plus models, where the government would subsidize research and development, are fading.
The burden has shifted to contractors, with the expectation that tech is relatively mature and developed through internal R&D before it reaches the government.
Technologically, products must be “plug and play” to adhere to the Modular Open Systems Architecture (MOSA).
Closed technology and walled gardens are relics of the past; the competitive advantage of proprietary technology has been replaced by the ability to integrate seamlessly with others.
Golden Dome is Forcing the Pentagon to Confront Missile Defense Economics
Gen. Michael Guetlein, head of the Golden Dome missile defense program, said the success of this effort depends on the ability to field defenses that are both scalable and affordable, including new directed-energy and other non-kinetic technologies aimed at lowering the cost of intercepting missiles.
Guetlein said the program’s central challenge is the economics of missile defense, specifically how the cost of each intercept limits how many interceptor shots the United States can afford to keep on hand.
He described this as an issue of “magazine depth,” a term that refers to the number of interceptors available to respond to an attack.
Missile defense systems with limited magazines can be exhausted quickly if an adversary launches multiple weapons or employs decoys.
The thinking is that a system that can only handle a small number of intercepts does not provide credible deterrence.
The “cost per kill” has to come down as current U.S. missile defense interceptors, which were designed for regional or limited homeland defense missions, cost millions of dollars apiece and are used to defeat much lower-cost weapons.
Directed energy systems, including lasers and neutral particle beams, are among the concepts Guetlein has highlighted as potential ways to drive down the cost per shot while increasing magazine depth.
Guetlein also pointed to “left of launch” defenses, a phrase used to describe efforts to stop missile threats before a launch occurs.
He noted that they are taking private equities’ view of the defense industrial base, adding that he regularly meets with investment bankers to help stabilize demand signals as companies seek capital to expand capacity.
One of the most demanding pieces of the program, he said, is the command-and-control layer that connects sensors, decision-makers and interceptors across services and classification levels.
That software “glue layer” must be demonstrated this summer, integrated with interceptors in 2027, and shown operating against credible threats in 2028.
Beyond technology, Guetlein said entrenched culture and organizational behavior pose daily obstacles. He criticized what he described as a compliance-driven mindset that prioritizes risk elimination over speed and integration.
Our Take: Magazine depth is one of the most pressing problems and why we were encouraged by one of the early GD4A RFPs out of MDA for a Low-Cost Interceptor. As we articulated in a blog post from 2024, outspending an adversary on defensive weapons that are higher than the offensive ones is a reverse cost imposition strategy (Defense vs Offense). GD4A defensive inventories also need to be balanced against the non-nuclear offensive inventories. It will be a losing proposition if key munitions for power projection are overridden by ones for defense. Recall, that counter-strike is also an option for GD4A. For reference to the constituent pieces of GD4A, check out our Iron Dome for America post last year.
New Defense Strategy Prioritizes Western Hemisphere. Where Does that Leave the Pacific?
The Pentagon released its new National Defense Strategy late Jan. 23, emphasizing a new commitment to the Western Hemisphere. But while that focus garnered most of the headlines, the strategy’s subtle shifts on China raise questions about how the Trump administration aims to leverage U.S. military power in the Indo-Pacific.
It says the U.S. will practice “realistic diplomacy,” emphasizing “deconfliction and de-escalation” in its relations with China so that the two economic rivals and their trading partners in the Pacific can “enjoy a decent peace.”
The United States will erect “a strong denial defense” along the First Island Chain, the strategy explains, referring to the Pacific islands that include Japan, Taiwan, portions of the Philippines and Indonesia.
It will ensure the U.S. military can conduct “devastating strikes and operations against targets anywhere in the world, including directly from the U.S. homeland.”
By giving up the “pacing challenge” language from the 2022 document, a former Air Force official argued, the new document “will be read as a weaker position that the United States is taking in terms of deterrence and resolve.”
Others say that references to “denial defense” inside the first island chain are critical inclusions and indicate no real change to U.S. policy.
The denial defense portion of the strategy will lean on the Air Force’s agile combat employment concept, pushing it from an “operational concept to an operating system” according to LtGen Deptula.
Some of these details will be in classified documents and budgets and could be the real determinants for how the U.S. is postured against China.
How China’s Military Purge Could Help the Pentagon
Chinese leader Xi Xinping’s removal of two of China’s most senior military leaders last week could boost Pentagon efforts to counter China’s growing military muscle in the Indo-Pacific.
Chinese authorities detained Zhang Youzia and Liu Zhenli, members of China’s powerful Central Military Commission, for what state media reported were “suspected serious discipline and law violations” — shorthand for corruption.
The uncertainty that breeds in the upper ranks could make leadership less effective and Beijing’s demonization of Zhang and Liu could also sour the fighting spirit of soldiers shellshocked by their downfall.
There’s potential for the Pentagon to exploit the tumult within the Chinese military by accelerating moves to bolster the network of alliances and defenses in the Indo-Pacific in case of a future conflict with China.
“Right now Zhang and Liu are in hotel rooms being sweated to write their confessions and to include a list of their ‘network,’ so there’s a lot more purging that’s going to go on.” Dennis Wilder, former National Security Council director for China under the George W. Bush administration.
Other International News:
Taiwan completes first undersea trial for domestically made submarine
Invisible defender? Opportunities and challenges for integrating DEWs into Ukraine’s C-UAS framework
China builds 35.6 tesla magnet 700,000 times stronger than Earth’s magnetic field
Yet another partial government shutdown. Yet it appears they’re on a path to reopen next week. There is agreement on the defense appropriation details.
Podcasts, Books, and Videos
Rep. Rob Wittman on the 2026 NDAA, Atlantic Council
Building the AI Plumbing for Defense w/Ben Van Roo, Crossing the Valley
Translating SOF Skills Far Beyond the Battlefield w/Bill Wall, Second Front
America’s Technology Long Game for Competing with China, CSIS
How Digital Twins Can Change Military Testing w/Joe Ditchett, Fed Gov Today
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Do we actually believe that a new board made up of folks who for the most part either talked about fixing the bureaucracy but never made measurable improvements or never bad-mouthed the system at all will somehow make meaningful change? This is the part I truly don't understand -- we bring in folks (most of whom I bet have homes within commuting distance of DC) to "fix" and/or "change" and/or "modernize" who have little or no real world experience with any of that.
The board should in my opinion be composed of really smart folks who spend a lot of their initial period asking "why do we do that?" and when presented with bureaucratic answers then recommending feasible solutions to not do that regardless the bureaucratic cost.
Another banger compilation of the increasingly dynamic era of military acquisition. Keep it up guys!