Nouvelles

By Ellen Nakashima The Pentagon has a new goal aimed at protecting its $100 billion supply chain from foreign theft and sabotage: to base its weapons contract awards on security assessments — not just cost and performance — a move that would mark a fundamental shift in department culture. The goal, based on a strategy called Deliver Uncompromised, comes as U.S. defense firms are increasingly vulnerable to data breaches, a risk highlighted earlier this year by China's alleged theft of sensitive information related to undersea warfare, and the Pentagon's decision last year to ban software made by the Russian firm Kaspersky Lab. On Monday, President Trump signed into a law a provision that would bar the federal government from buying equipment from Chinese telecommunications firms Huawei and ZTE Corp., a measure spurred by lawmakers' concerns about Chinese espionage. “The department is examining ways to designate security as a metric within the acquisition process,” Maj. Audricia Harris, a Pentagon spokeswoman, said in a statement. “Determinations [currently] are based on cost, schedule and performance. The department's goal is to elevate security to be on par with cost, schedule and performance.” The strategy was written by Mitre Corp., a nonprofit company that runs federally funded research centers, and the firm released a copy of its reportMonday. “The major goal is to move our suppliers, the defense industrial base and the rest of the private sector who contribute to the supply chain, beyond a posture of compliance — to owning the problem with us,” said Chris Nissen, director of asymmetric-threat response at Mitre. Harris said the Pentagon will review Mitre's recommendations before proceeding. She added that the Department of Defense, working with Congress and industry, “is already advancing to elevate security within the supply chain.” Testifying to Congress in June, Kari Bingen, the Pentagon's deputy undersecretary for intelligence, said: “We must have confidence that industry is delivering capabilities, technologies and weapon systems that are uncompromised by our adversaries, secure from cradle to grave.” Security should be seen not as a “cost burden,” she told the House Armed Services Committee, “but as a major factor in their competitiveness for U.S. government business.” The new strategy is necessary, officials say, because U.S. adversaries can degrade the military's battlefield and technological advantage by using “blended operations” — hacking and stealing valuable data, manipulating software to sabotage command and control systems or cause weapons to fail, and potentially inducing a defense firm employee to insert a faulty component or chip into a system. “A modern aircraft may have more than 10 million lines of code,” Mitre's report said. “Combat systems of all types increasingly employ sensors, actuators and software-activated control devices.” The term “Deliver Uncompromised” grew out of a 2010 meeting of senior counterintelligence policy officials, some of whom lamented that the Defense Department was tolerating contractors repeatedly delivering compromised capabilities to the Pentagon and the intelligence community. Addressing the security issue requires greater participation by counterintelligence agencies, which can detect threats against defense firms, the report said, and ideally, the government should establish a National Supply Chain Intelligence Center to monitor threats and issue warnings to all government agencies. Ultimately, the military's senior leaders bear responsibility for securing the supply chain and must be held accountable for it, the report said. The Defense Department, although one of the world's largest equipment purchasers, cannot control all parts of the supplier base. Nonetheless, it has influence over the companies it contracts with as it is the principal source of business for thousands of companies. It can shape behavior through its contracts to enhance supply-chain security, the report said. Legislation will be needed to provide incentives to defense and other private-sector companies to boost security, Mitre said. Congress should pass laws that shield firms from being sued if they share information about their vulnerabilities that could help protect other firms against cyberattacks; or if they are hacked by a foreign adversary despite using advanced cybersecurity technologies, the report said. Contractors should be given incentives such as tax breaks to embrace supply chain security, the report suggested. The Department of Homeland Security is addressing the security of the information technology supply chain through its newly established National Risk Management Center. “What we're saying is you should be looking at what vendors are doing to shore up their cybersecurity practices to protect the supply chain,” said Christopher Krebs, DHS undersecretary for the National Protection and Programs Directorate. The National Counterintelligence and Security Center, an agency of the Office of the Director of National Intelligence that coordinates the government's counterintelligence strategy, said in a report last month that software-supply-chain infiltration has already threatened critical infrastructure and is poised to endanger other sectors. According to the NCSC, last year “represented a watershed in the reporting of software supply chain” attacks. There were “numerous events involving hackers targeting software supply chains with back doors for cyber espionage, organizational disruption or demonstrable financial impact,” the agency found. https://www.washingtonpost.com/world/national-security/the-pentagon-is-rethinking-its-multibillion-dollar-relationship-with-us-defense-contractors-to-stress-supply-chain-security/2018/08/12/31d63a06-9a79-11e8-b60b-1c897f17e185_story.html?noredirect=on&utm_term=.265ce85b6eb1

By: Jessie Bur The Department of Defense kicked off its sixth bug bounty program Aug.12 with Hack the Marine Corps, a challenge focusing on the Corps' public-facing websites and services. “Hack the Marine Corps allows us to leverage the talents of the global ethical hacker community to take an honest, hard look at our current cybersecurity posture," said Maj.Gen. Matthew Glavy, the head of the U.S. Marine Corps Forces Cyberspace Command, in a news release. “Our Marines need to operate against the best. What we learn from this program will assist the Marine Corps in improving our war-fighting platform, the Marine Corps Enterprise Network. Working with the ethical hacker community provides us with a large return on investment to identify and mitigate current critical vulnerabilities, reduce attack surfaces and minimize future vulnerabilities. It will make us more combat ready.” The DoD launched its first bug bounty, Hack the Pentagon, in May 2016, which was considered one of the first major successes for the then-newly minted Defense Digital Service. Since then the DoD has held bug bounties for the Army, the Air Force, the Air Force again and the Defense Travel System. The combined programs resulted in over 600 resolved vulnerabilities with approximately $500,000 awarded to the ethical hackers participating in the program. “Information security is a challenge unlike any other for our military. Our adversaries are working to exploit networks and cripple our operations without ever firing a weapon," said Chris Lynch, the director of the Defense Digital Service. "Sometimes, the best line of defense is a skilled hacker working together with our men and women in uniform to better secure our systems. We're excited to see Hack the Pentagon continue to build momentum and bring together nerds who want to make a difference and help protect our nation.” Hack the Marine Corps was launched with HackerOne, which partners with the hacker community to help businesses and government conduct bug bounties, and kicked off with a live hacking event coinciding with the Black Hat USA, DefCon and BSides conferences in Las Vegas. The live hack resulted in 75 unique vulnerability reports and more than $80,000 in awards. “Success in cybersecurity is about harnessing human ingenuity,” said Marten Mickos, CEO at HackerOne. “There is no tool, scanner or software that detects critical security vulnerabilities faster or more completely than hackers. The Marine Corps, one of the most secure organizations in the world, is the latest government agency to benefit from diverse hacker perspectives to protect Americans on and off the battlefield.” The bug bounty program ends Aug. 26. https://www.fifthdomain.com/dod/marine-corps/2018/08/13/pentagon-invites-researchers-to-hack-the-marine-corps/

Airbus's Zephyr solar-powered drone flew for 25 days straight during a test-flight over Yuma, Arizona beginning on July 11, 2018. The flight represented a record for aircraft endurance, breaking the previous 14-day record also set by a Zephyr back in 2015. The long flight has big implications for military surveillance. Drones like Zephyr could loiter over a low-intensity battlefield far longer than current drones can do. The latest high-endurance Reaper drone maxes out at 40 hours in the air. The propeller-driven Zephyr belongs to a class of aircraft known as “high-altitude pseudo-satellites,” or HAPs. Flying as high as 70,000 feet for weeks or even months at a time, HAPs perform many of the same missions that low-orbiting satellites do. “The main HAP applications are in telecommunications and remote sensing, both civilian and military,” Flavio Araripe d'Oliveira, Francisco Cristovão Lourenço de Melo and Tessaleno Campos Devezas wrote in a 2016 paper. Compared to comms satellites, HAPs have the advantages of lower latency and the ability to land for maintenance or reconfiguration, d'Oliveira, de Melo and Devezas explained. For surveillance missions, HAPs unlike satellites can linger over a particular area and could produce images with better resolution, since they fly lower than satellites do. HAPs could be more vulnerable to enemy defenses, however. Where satellites orbit many hundreds of miles over Earth, beyond the reach of most conventional weaponry, Zephyr — so far the only HAP undergoing realistic testing — attained a maximum altitude of 70,000 feet, well under the ceiling for modern air-defense missile systems such as the Russian S-300. Also, the drone is slow, with a cruising speed of just 20 miles per hour. Zephyr and similar pseudo-satellite drones could be best-suited for operations over lightly-defended territory. In 2016, the U.K. ministry of defense bought three Zephyrs for around $6 million apiece in order to evaluate them for potential use by the military and other government agencies. “Zephyr is a cutting edge, record-breaking piece of kit that will be capable of gathering constant, reliable information over vast geographical areas at a much greater level of detail than ever before,” then-defense secretary Michael Fallon said in a statement. Airbus is still refining Zephyr, in particular its power-consumption. During daytime, the lightly-built solar-powered drone — which features an 82-foot wingspan and yet weighs just 165 pounds — can fly as high as 70,000 feet while also charging its batteries. After the sun goes down, Zephyr runs on batteries ... and slowly loses altitude. During the record-setting Yuma flight, the drone dipped as low as 50,000 feet at night. The challenge for Airbus is to balance weight and power-consumption to produce the optimal flight profile for a particular task. “You have to find the right equation between flying altitude plus battery life, maintaining this or that power,” said Alain Dupiech, an Airbus spokesperson. It's unclear just how long Zephyr could stay aloft under the right conditions. The drone's lithium-ion battery eventually dies, forcing it to land for maintenance. But battery technology is advancing rapidly, driven in part by consumer demand for electric cars, d'Oliveira, de Melo and Devezas wrote. In the short term, a maximum endurance of several months is not inconceivable. But longer flights might not be particularly useful for surveillance and comms missions, Dupiech said. “At this stage, most of those missions are not calling for a year and half up there.” Airbus has scheduled Zephyr's next test flight for October in western Australia. http://warisboring.com/new-spy-drone-flies-non-stop-for-a-month/

By: Seth J. Frantzman JERUSALEM — For the first time, the National Defense Authorization Act includes a section on U.S.-Israel cooperation in countering unmanned aerial systems, in the fiscal 2019 version. The cooperation will identify “capability gaps” of the U.S. and Israel in countering UAVs and seek out projects to address those gaps to strengthen U.S. and Israeli security. The new cooperation envisions funding for research and development efforts and identifying costs that foresee close cooperation modeled on previous successful programs that Israel and the U.S. have collaborated on, including missile defense and anti-tunneling initiatives. Israel and the U.S. have been at the forefront of air defense cooperation for decades. U.S. Reps. Charlie Crist and Mike Johnson introduced in February a bill titled “United States-Israel Joint Drone Detection Cooperation Act.” Parts of the bill were included in the NDAA passed in both houses of Congress in July. “I am honored to have our bill included in the NDAA and to see it signed into law by President [Donald] Trump. This is an important step not only for our strongest ally in the Middle East but for the United States as well,” Johnson said in July. The president signed the NDAA into law on the afternoon of Aug. 13. The initiative foresees “joint research and development to counter unmanned aerial vehicles [which] will serve the national security interests of the United States and Israel.” Included as Section 1272 of the final NDAA presented to the president on Aug. 3, the cooperation contains five parts, including identification of the capability gaps that exist, identifying cooperative projects that would address the gaps, assessing the costs of the research and development, and assessing the costs of procuring and fielding the capabilities developed. Reports on the cooperation will be submitted to the congressional defense committees, the Senate Foreign Relations Committee and the House Foreign Affairs Committee. The threat of drones has increased in recent years. On Feb. 10 an Iranian-made drone entered Israeli airspace near the northern town of Beit Shean. It had flown from the T4 air base in Syria. Israel identified and tracked the drone from Syria and sent an Apache helicopter to shoot it down. The drone was revealed to be armed with explosives. Former Mossad chief Danny Yatom said in an interview in April that the drone was sophisticated and “an exact replica of the U.S. drone that fell in their territory,” referring to the American RQ-170 Sentinel, which was downed in Iran in 2011. Iran developed two drones based on the Sentinel, one called Shahed 171 and an armed version dubbed Saeqeh, which debuted in 2016. In 2012, Hezbollah used a drone to try to carry out surveillance of the Dimona nuclear reactor in southern Israel. “It's not the first time and it will not be the last,” warned Hezbollah leader Hassan Nasrallah. Conflict Armament Research reported in March 2017 that kamikaze drones using Iranian technology were being used by Houthi rebels in Yemen against Saudi Arabia and the United Arab Emirates. The UAE has sought to bring attention to this threat during the conflict in Yemen, in which a Riyadh-led coalition is fighting the Houthis. Drones were also used by the Islamic State group to attack U.S.-led coalition forces in Syria and Iraq. And Afghan officials reported an Iranian drone entered their airspace in August 2017. In September 2017, Israel used a Patriot missile to down a Hezbollah drone. Israel used Patriotmissiles twice to down Syrian UAVs near the Golan Heights demilitarized zone in July 2018. The U.S. reportedly used an F-15E Eagle to shoot down an Iranian-made Shahed 129 drone in June 2017 in Syria. The drone was heading for the U.S. base at Tanf, which is located in Syria near the Jordanian border. A systematic examination of the emerging drone threat is in the works. The U.S. Defense Department has been allocating resources to counter UAVs, with U.S. Central Command requesting up to $332 million over the next five years for efforts to counter drones. The U.S. Army has been looking for new missiles to defend against a variety of threats, including drones. This will include the Expanded Mission Area Missile and may include other Israel missiles such as the Tamir interceptor for use with a multimission launcher. https://www.defensenews.com/unmanned/2018/08/13/new-defense-budget-bill-foresees-us-israel-counter-drone-cooperation/

Bill Carey General Atomics Aeronautical Systems (GA-ASI) will nearly quadruple the space it occupies at the Grand Sky research and development park in Grand Forks, North Dakota, the park announced Aug. ... http://aviationweek.com/air-dominance/general-atomics-expands-presence-north-dakota-rd-park

Key Points The USAF sought to decrease the time of pilot training without sacrificing learning Pilot Training Next relied heavily on simulators and other existing and emerging technologies The US Air Force (USAF) sought to decrease the time and cost of pilot training without sacrificing the depth of learning through its Pilot Training Next (PTN) initiative. PTN, which ran from February to 3 August 2018, included blended learning and data-centric facets by using existing and emerging technologies such as virtual and augmented reality, advanced biometrics, artificial intelligence (AI), and data analytics, according to a service statement. The knowledge gained was to be used to refine scientific measuring capabilities and teaching techniques. https://www.janes.com/article/82339/us-air-force-seeks-to-improve-student-pilot-learning-through-new-initiative

By: Tom Kington and Pierre Tran ROME and PARIS — Italian shipyard Fincantieri has bought a key Italian technologyfirm to gain extra clout ahead of a planned team-up with France's Naval Group. State-controlled Fincantieri said Aug. 7 it was jointly taking control of Vitrociset, which employs 800 people and posted 2017 sales of €187 million (U.S. $211 million) from its training and support work in the defense, security, transport and space sectors. The shipyard will take over Vitrociset's defense work, while its partner in the purchase, Italian firm Mer Mec, will assume control of its civil work. That leaves Fincantieri, which builds warships, submarines and cruise ships, in charge of Vitrociset's aerospace work, including ground support work on the F-35 Joint Strike Fighter. The move triggered speculation in Italy that Fincantieri was bulking up to gain a stronger hand as it proceeds with cooperation talks with French shipyard Naval Group, given that Vitrociset is involved in automation, command and control, simulation, and testing work.
 A company source played down the timing of the deal, saying: “Vitrociset simply makes us more complete.” The announcement followed a visit to Rome on Aug. 1 by French Economy and Finance Minister Bruno Le Maire to discuss the Fincantieri-Naval Group talks, which started last year but slowed during the creation of a new, populist government in Italy in June. The new government in Rome has had a series of spats with Paris, starting with France's reluctance to take in migrants who sail from Libya to Italy. The Italian government is also reluctant to move ahead on a new rail link between Italy and France, even though millions of euros have been spent on the program. And France and Italy are at loggerheads over lawless Libya, where the European nations back opposing sides in the slow-burning conflict.
 Tensions reached a peak last month when Italian Deputy Prime Minister Matteo Salvini openly said he did not want France to win the soccer World Cup, which it did. In June, Naval Group and Fincantieri handed their respective governments plans for possible industrial cooperation, a move seen by Fincantieri Chairman Giuseppe Bono as leading to an“Airbus of the sea,” seen as kick-starting a wider integration of the fractured European naval industry. Addressing Italy's Parliament this month, Bono said he was also backing moves by the European Union to encourage joint spending among partners, effectively leading to pooled EU defense procurement from transnational European defense giants. “Europe spends little and spends badly,” he said. “Everyone acts in the interest of their own nation; but if we concentrated, we could spend less but be more capable and more efficient.” Fincantieri is already set to take over French civil shipyard STX, and at the start of the year, Bono said a French-Italian merger of naval work could occur within five to 10 years. However, Le Maire was cautious during his Rome visit, claiming “it would not be wise” to talk of a naval merger. Current plans go no further than a 10 percent share cross-holding, combined with pooling research, acquisition of material and teaming on export work to reduce competition. Naval Group avoids the use of the Airbus tag, which signals a high degree of industrial consolidation, and prefers to refer to closer cooperation. The cooperation plan is creating uncertainty over the role to be played by Italian and French firms Leonardo and Thales, which rely on selling their systems for their nations' warships. Speculation that Leonardo would be sidelined in future joint ships built by Fincantieri and Naval Group increased with news of the Italian yard's purchase of Vitrociset, although Bono promised that Leonardo's involvement in the tie-up was “on the cards,” pointing out how it was an integral part of two offers of corvettes that Fincantieri was making to Romania and Brazil. Thales, which holds a 35 percent stake in Naval Group, also reportedly expressed caution about linking up Naval Group and Fincantieri, an Italian source told Defense News. This year, a leaked 36-page report from ADIT, a partially French state-owned company working in economic intelligence, painted a “highly negative” picture of the compliance and ethics of Fincantieri, a depiction which was challenged by Fincantieri. “There is a lack of communication, a lack of figures,” according to Fabrice Wolf, a defense economics analyst. “This leads many to be concerned that this project is ideologically driven and that the realities of the industrial base are not fully taken into account.” The main interest for Naval Group is to find work for its research office, which is the real reason for the FTI intermediate frigate program, he said. 
There is a “concern” elsewhere in French industry, notably at Thales, which sees its sale of radars and electronic systems under risk from Italian archrival Leonardo, Wolf added.
 “Naval Group is a great partner for Thales and I hope that lasts,” said Thales CEO Patrice Caine, business daily Les Echos reported May 27. Thales is more than just a shareholder in Naval Group, as the former transferred its combat systems business to the latter in 2007 in exchange for a shareholding, he added. 
“When we build the FTI frigate with Naval Group, it's like building the Rafale with Dassault — it's a link up for life,” he said, pondering the intentions of an Italian government that pursues nationalism and a protectionist trade policy. Naval Group and Thales were unavailable for comment.
 The Italian pursuit of anti-immigration and anti-free trade seems to have struck a chord with U.S. President Donald Trump, who met Italian Prime Minister Giuseppe Conte at the White House on July 30. 
“Italy is becoming a reference country in Europe and a privileged partner of the United States,” Trump said. 
That U.S. preference for Italy effectively puts Rome ahead of Paris, French media have reported. https://www.defensenews.com/top-100/2018/08/10/fincantieri-bulks-up-with-acquisition-ahead-of-naval-group-partnership/

By: David B. Larter WASHINGTON — The U.S. Navy intends to get much bigger, and that has meant new openings for European companies in the U.S. defense market. The Navy's new over-the-horizon missile destined for the littoral combat ship and the future frigate was recently awarded to the Norwegian firm Kongsberg, in partnership with U.S. company Raytheon, for its Naval Strike Missile. The future frigate program itself has awarded contracts to Spain's Navantia and Italy's Fincantieri for design work before the Navy selects a design later this year, meaning the service's next surface combatant may be a European design. And for the Navy's future training helicopter, both Franco-Dutch company Airbus and Italian firm Leonardo are top competitors for that program. Analysts say the Navy's recent surge in interest has been spurred by a confluence of circumstances that could mean even more opportunities for foreign companies looking to break into the U.S. market. Increased defense budgets are one reason the European companies have been seeing more business from the Navy and other American military branches. But a shift in the way the Defense Department tries to fill capabilities gaps has made the space more competitive for overseas firms, said Dan Gouré, a defense analyst with the Lexington Institute think tank. As the Navy and other services have shifted toward great power competition, it has found a number of capabilities that were not hugely important in a unipolar world have again become requirements with the reemergence of Russia and the rise of China as security threats. One such area is the small surface combatant, or FFG(X) program, which would be needed to escort supply convoys and work as a survivable sensor node in a larger surface combatant network. “With the frigate, for example, we hadn't built one of those in 40 years, but the Europeans have been building them for decades,” Gouré noted. “And if we needed a diesel-electric sub, they'd of course be the first in line.” This emphasis on speed of acquisition has also helped because the Navy and the rest of the Department of Defense are reluctant to get tied down by a yearslong, inevitably over-budget development process unless necessary, Gouré said. “The trend has been toward [other transaction authority] contracts, and that has made the European companies credible competitors,” he said. Another factor is that the Navy has been more willing to make trades on capabilities, said Bryan Clark, an analyst with the Center for Strategic and Budgetary Assessments. “I think what's new is that the Navy is openly seeking foreign proposals for some of these major new programs,” Clark said. “Foreign companies have always been able to submit proposals in response to RFPs, but usually they don't offer the high-end capability the U.S. is usually seeking. “The big change is that the Navy is willing to get a less-sophisticated capability in to get a design that is more mature.” In the case of the Navy's trainer helicopter competition, past success with European companies inside the DoD could be a driving factor in Airbus' and Leonardo's competitive bids. Airbus' North American division has been successful with the U.S. Army's Lakota program, built by Airbus Helicopters in Columbus, Mississippi, which is where the company would build its H135 helicopter if selected for the program. The Army has been happy with Lakota, so much so that it has been pushing to buy more of the airframes despite legal battles over the contracts. But the success of Airbus Helicopters with the Army is possible for much the same reason that, for example, Australian-owned Austal USA has been successful building both the trimaran version of the littoral combat ship and the expeditionary fast transport: a major manufacturing infrastructure investment in the United States. And that kind of cash outlay for a program can scare away European competitors. Getting around “Buy American” provisions would literally take an act of Congress. Despite having already developed, tested and fielded the capability the Navy wants, Kongsberg had to team with American defense giant Raytheon to sell its missile to the DoD. The “Buy American” provisions laid down and regularly upheld by Congress for defense procurement does have protectionist overtones, but there is a national security argument as well. In the event of a major, protracted conflict with Russia or China, it wouldn't be advantageous to have major suppliers located an ocean away or in occupied territory. And maintaining the industrial base has long been a concern of the U.S. Navy because of the limited the number of trained workers with experience who are building ships and nuclear reactors. Navy officials have testified that the shrinking industrial base, including the shipbuilders and the litany of subcontractors and vendors, is a significant concern. In 2015, then-head of the Navy's research, development and acquisition office Sean Stackley testified before Congress that some of the shipyards were just a contract away from going under. “We have eight shipyards currently building U.S. Navy ships. And of those eight shipyards, about half of them are a single contract away from being what I would call ‘not viable,' ” Stackley told the Senate Armed Services Committee. “In other words, the workload drops below the point at which the shipyard can sustain the investment that it needs to be competitive and the loss of skilled labor that comes with the breakage of a contract.” https://www.defensenews.com/top-100/2018/08/09/us-navys-focus-on-rapid-acquisition-is-opening-up-opportunities-for-europe/

By: Jill Aitoro WASHINGTON — The secret to tackling the defense information technology market may be scale. Looking specifically at the pure-play IT companies that landed on the 2018 Defense News Top 100 list, many of those that have doubled down in some capacity saw defense revenue increase during fiscal 2017. That came on the tail end of another trend among the largest defense primes, to get out of the IT business. “The evolution started a couple years ago, where the large defense primes who had boned up on IT service work during the war [on terror] started to realize that for a variety of reasons they might not be able to compete as effectively, or extract the returns they want out of a business like that,” said Jon Raviv, senior analyst and vice president for aerospace and defense at Citi Research. Divestitures followed, and pure-play IT companies were able to quickly scale up not just in size and their ability to support massive contracts, but also in capability set. The acquisition of Lockheed Martin's IT business transformed Leidos from a $5 billion company to a $10 billion company. That deal closed in late 2016, explaining how the company saw double-digit growth in defense revenue in both 2016 and 2017 — despite the buy actually making the company less defense heavy overall. Similarly, CACI closed on the acquisition of L3 Technology's National Security Solutions for $550 million in February 2016 — three months before the end of its fiscal year. The associated revenue contributed to the 16 percent increase in defense revenue during 2017. Leidos CEO Roger Krone, in an interview with Defense News in 2016 soon after the acquisition closed, pointed to “scale, but not scale for scale's sake” as a big factor in the buy — noting, too, the importance of balancing the portfolio and geographic distribution. He also pointed to sheer numbers — 15,000 employees specifically — many with security clearances. The trend does seem to be continuing. CSRA chose to not participate in the 2018 Top 100 because its $9.7 billion acquisition by General Dynamics closed by the time data collection for the list kicked off. While General Dynamics is a top defense prime, its IT business functions as a largely separate entity, similar to the pure-play IT companies. The acquisition of CSRA, which reported $2.25 billion in defense revenue for fiscal 2016 — will add significant scale to GDIT. It is also likely to influence the company's Top 100 rank next year. The future promises more cyber and IT-related merger and acquisition activity in the vein of that deal, according to Daniel Gouré, a vice president with the Lexington Institute think tank. “Raytheon is still in acquisition mode with cyber, so it's an area that's still kind of churning,” he said. “I wouldn't be surprised to see some of these big players acquire some of the more defense-oriented cyber players.” Unclear is what the sweet spot may be for those exclusively IT-focused firms. “Where we sit right now, it's not clear what the right size is,” Raviv said. “GDIT and Leidos are about $10 billion in sales; SAIC and CACI and ManTech are lower tier. All of those companies say they are happy with scale but could do a deal. Whether they call it scale, or marrying capability sets — it's all marketing, I suppose.” And there are other tactics that achieve scale without acquisition. Perspecta emerged on the 2018 Top 100, having launched June 1, 2018 through the combination of DXC Technology's U.S. public sector business, Vencore, and KeyPoint Government Solutions. As one entity, Perspecta reported $2.73 billion in defense revenue and ranked 37. To put that in perspective, Vencore ranked 67 in last year's list, with $886.59 million in defense revenue. And all of these pure-play companies are increasingly marketing themselves as conduits to the “nontraditional players” that the Pentagon is so keen to attract. Amazon Web Services, for example, will often partner with government IT companies on defense contracts to hand off some of the contracting morass. That said, for all the potential, the bulk of the defense IT market is notoriously fickle. Services often set aside IT projects in an effort to preserve platform buys, and margins can be low. Agencies also struggle to balance upkeep of existing systems versus modernization efforts versus research and development into the next great technological marvel. But as Raviv noted, it's all IT. “Yes, there are companies working on high-end cyber, the ability to launch attacks through cyberspace or to harden the communication node on a new missile so it can't be hacked by, say, China. And while the word cyber came up a lot three or four years ago, now you hear a lot about AI, autonomy and machine learning. But it's all technology. And it's a lot of smart people working on a lot of advanced things many of us don't understand.” https://www.defensenews.com/top-100/2018/08/09/for-it-companies-the-secret-to-success-in-defense-is-all-about-big-growth/