Start your day with intelligence. Get The OODA Daily Pulse.

Home > Analysis > Is the Capability-as-a-Service Business Model the Future of the [Defense] Industrial Base?

Featured Image Source:  Border Security Report

Background

Paul Hollingshead, Head of Europe & Africa at Anduril Industries, recently defined the Capability-as-a-Service [CaaS] business model as “an alternative to traditional government capital expenditure, which can be frustrated by almost immediate obsolescence in the Information Age. When paired with open architecture software solutions…[CaaS] offers outstanding value for the money.” 

“The objective is to generate continuous improvement, increasing value or reducing costs per mission. Most of our products can be delivered ‘as a service’, which reflects subscription services in a commercial setting,” according to Hollingshead, “The value is in the service, not in the hardware. Customers will benefit from new features and capabilities in both software and hardware during the subscription period.  As a result of subscribing, the government encourages the supplier to develop or risk losing the contract.” (1)

Virtual Borders – Are they really a thing?

A recent border security CaaS case study by Tony Kingham (Editor of the Border Security Report), Hollingshead notes, is “an interesting article for how…border security practitioners can benefit from the latest tech, while also integrating national sensor manufacturers or software component suppliers”:

“Whilst the ‘wall or no wall’ border argument continues, developments in smart border technology grow a pace, primarily driven by the potential of Artificial Intelligence (AI) and Machine Learning.

Governments and border agencies across the world, but particularly in the US and Europe have been quick to recognize the potential of AI to dramatically increase the effectiveness of their existing and future surveillance systems.

The so-called ‘smart wall’ linking ground systems such as radar, seismic sensors, fibre optics, cameras, aerostats and drones, with communications and databases promises much, but where are we in terms of delivery?

The main problem for many border agencies worldwide is that they already operate a wide variety of legacy surveillance systems which may have their own operating systems that do not necessarily talk to other systems in their surveillance environment.

So, it is entirely possible, if not usual, to have a situation in which one team operates the ground-based radar, another team, the electro-optics, others the airborne assets (if they are lucky enough to have them) and yet more on-ground sensors like seismic sensors and microwave fences. This creates a problem of cooperation and coordination (that may be familiar to many of our readers.) Each team may even be on separate communications systems, which is especially true of airborne assets.

The trouble is, that these legacy systems represent a considerable investment and governments are reluctant, especially in the current financial environment, to bin perfectly good systems and start afresh.

In the past, major projects like a nation’s border were the domain of the big integrators, many of them from the defence sector. These manufacturers would create a bespoke command and control system which necessarily gave them a lot of influence over the project and what systems could or couldn’t be included.
The promise of open architecture and AI is that it puts the customer back in charge and allows them to choose the what, when and where, of systems and equipment they include…

…fundamental to this approach is the communications system along with all the necessary infrastructure that it requires, without which it is simply not possible, especially on extended borders like the US/Mexico border or Europe’s external borders. But the infrastructure for new systems is expensive, requiring hundreds if not thousands of miles of power and communications lines, substations, maintenance, etc.

To solve this particular problem the U.S. Customs and Border Protection (US CBP) Agency has gone for the obvious and most cost-effective solution in that sun-baked environment, which is solar.  Having reliable sunshine makes use of self-sustained surveillance towers powered by solar, a practical and economic way of increasing security on the southern border.

So, into this domain stepped US tech company Anduril, which developed its Lattice open architecture operating system. The system is designed to integrate sensors from third-party vendors into a single digital environment where AI/ML techniques can be applied to ease the burden on multiple operators. But a software-only approach didn’t make sense to address all of the issues in austere environments. The lack of civil infrastructure, poor connectivity, and a general topology prevented border forces from maximizing the benefits of traditional sensors.

Anduril’s software-first, hardware-enabled approach addressed this by using low-cost third-party sensors that delivered enough data to be passed through and retrieved for users to interrogate.

Consequently, they developed the Sentry Tower, which, like products on the consumer market – has undergone several generations of development, continuously improving its capabilities. As a robotic observation post, it uses affordable radar, cameras, and sensors, combining and analyzing the data locally. It is solar-powered and has more local computer power than most military systems. CBP combines them via radio and other communication carriers to create a hive mind of robots that cover its southern border’s undulating terrain. Anduril subsequently was deployed to other borders and sites to ingest legacy surveillance systems and develop a mission engine that provides border officials with an effective and efficient means of orchestrating resources by serving as a panopticon.

Anduril Industries’ Hollingshead…said…”The government has no sunk costs in developing the system but subscribes to its capabilities. It is delivered via hardware, much like the routers you get from a broadband service provider. The value is in the service, not in the hardware. Customers will benefit from new features and capabilities in both software and hardware during the subscription period. As a result of subscribing, the government encourages the supplier to develop or risk losing the contract continually.”

Anduril has already successfully integrated other OEM systems such as the Echodyne radar widely deployed on the US border, and electro-optics like those of FLIR.

Other systems that can be integrated are fibre optics like the Sintela ONYX™, Linear Ground Detection System currently deployed on the US border, as well as C-UAS systems like Anduril’s own cUAS system and Blighter’s AUDS.

In Europe, Monaco-based MARSS Group produces the NiDAR C2 system, which again uses an open architecture and is ‘sensor agnostic’ meaning it can integrate existing and new equipment. MARSS has won a number of significant contracts to protect critical infrastructure, especially in Saudi Arabia, but [Kingham] was unable at this point to confirm whether it is currently deployed on any border.

This sort of approach means that not only can border agencies integrate their legacy systems but they are also able to plug in new systems as and when budgets allow. This gives them the opportunity to use best-in-class systems where necessary or budget systems where the tactical circumstances allow, thus saving money.

The use of AI allows agencies to better utilize their most valuable and most expensive assets to the best advantage, i.e. their personnel.  Smart systems will allow personnel to be transferred from operations rooms to field operations. And, once in the field, instead of spending hours in often fruitless routine patrolling and manning observation posts, they can be accurately directed to border interdictions, making them more efficient and saving that most valuable of resources, time.” (1)

What Next? 

“The value is in the service, not in the hardware. Customers will benefit from new features and capabilities in both software and hardware…”

This article exploring the future of border security – along with the [CaaS] business model insights – is the textbook definition of a “jagged transition”  – with the challenges inherent in the adoption of disruptive technologies while still entrenched in low-entropy old systems and in the face of systemic global community threats and the risks of personal displacement.  It is also a formative case study of value proposition and value creation design potentials within a CaaS business model  – so as to design, quantify, and measure exponential innovation.

CaaS-based ecosystems and platforms should be designed with exponential growth signals and metrics in mind, which will act as best-in-class indicators of where, when and how best to deploy customer-centric benefits from new CaaS-based features and capabilities in both software and hardware

https://oodaloop.com/archive/2023/01/20/ooda-almanac-2023-jagged-transitions/

https://oodaloop.com/archive/2023/02/13/the-disintermediation-of-the-defense-industrial-base/

 

About the OODA Loop Exponential Innovation Series

https://oodaloop.com/archive/2023/02/06/designing-quantifying-and-measuring-exponential-innovation/

Featured Image Source:  Border Security Report

Daniel Pereira

About the Author

Daniel Pereira

Daniel Pereira is research director at OODA. He is a foresight strategist, creative technologist, and an information communication technology (ICT) and digital media researcher with 20+ years of experience directing public/private partnerships and strategic innovation initiatives.