Increased Spending on the Horizon in 2019 for Defense Department

By Mark Wisinger, Senior Analyst,immixGroup, An Arrow Company

FY2019 is shaping up to be an exciting year for the DOD. Looking back to this year- there’s been lot of changes to the Department, including new major organizations: Space Command, the Joint Artificial Intelligence Center, and the Army Futures Command. We’ve also got some name changes- PACOM is now Indo-Pacific Command; DIUX dropped the X from its name to show it’s here to stay.

The JEDI cloud competition has dominated headlines throughout this past year – the winner-take-all nature of the contract has been quite controversial. Amazon and Microsoft are the frontrunners, with IBM and Oracle nipping at their heels and filing protests. It was no secret that Amazon had a big advantage when the RFP was released, but Microsoft announced just a few days before the RFP deadline on October 12 that Azure will have a secret-capable cloud enclave ready to go in first quarter of 2019, with top secret following later. This is a key capability for JEDI that puts Azure on par with AWS. It’s still unclear even to those in the DOD, exactly how JEDI will fit into the DOD cloud landscape, so that’s something to keep a very close eye on when the contract is awarded.

To cap off this year’s happenings– U.S. Cyber Command became a full-fledged command in May and the buzz around AI and machine learning has never been greater.

With AI, machine learning and automation becoming the in-vogue lexicon in the IT industry, Congress has charged DOD with developing a plan to incorporate AI into its enterprise.DOD CIO Dana Deasy is taking a page out of the Intelligence Community’s playbook by creating the Joint Artificial Intelligence Center, the DOD’s counterpart to the IC’s Automating Intelligence using Machines initiative, known as AIM. Deasy has described the Joint AI Center or “JAKE” as “embryonic” at this stage – but it’s intended to become the central hub of AI expertise focused on operationalizing AI. It is based within the Pentagon, with a plan for regionalized hubs down the road. With $70M worth of funds dedicated to standing it up, JAIC is dedicated to developing standards for AI tools and data sharing, and repeatable technologies that operationalize AI.

The DOD FY 2019 features good budget news. DOD has $46.4 billion in IT funding for FY19, which is a 3 percent increase over last year. DOD received appropriations before the deadline, which is very unusual given that many recent years saw a lot of budget uncertainty and continuing resolutions well into the fiscal year. That should result in overall increased spending over last year as new funding levels are approved from the get-go.

Cybersecurity, as always, continues to be one of the places where DOD is making needed changes to modernize to ensure we’re protecting our networks, and in effect, our troops and personnel. DOD has $8.6 billion dedicated to cyber investments overall at DOD in the government fiscal year 2019; that’s about a 7 percent increase from FY18.

One huge cyber item to hit the news was the release of a new, formal cyber strategy—the first new one in three years. This is aimed at aligning cyber priorities to the National Defense Strategy. DOD agencies will be looking to leverage off-the-shelf solutions to reduce costs associated with custom built applications—as well as looking for flexibility that can help them keep pace with commercial solutions. They definitely want to operate in an environment that accepts more risk than in the past, in order to operate with more agility. It’s no longer about a “100 percent” solution, it’s about helping DOD defend its cyber posture in an agile way.

Cyber is another area that will affected by increased adoption of AI and automation—specifically to analyze large data sets related to cyber to detect malicious activity. Most of the strategy is aimed at cyber defense, so another place they are looking to improve their defensive posture is for critical infrastructure. The NDAA actually creates a new position that will oversee cybersecurity for industrial control systems. DOD will also be piloting a program to simulate cyber attacks on critical infrastructure to develop a better cyber posture and perform risk analysis.

FY19 is shaping up to be a great year for industry and the DOD. The cloud is firmly front-and-center for DOD with JEDI, and IoT is appearing on the horizon, as AI and machine learning remain critical focus areas. These emerging efforts and technologies will help the DOD quickly evolve to ensure future success.

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