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May 14 2016

May 20, 2016




14 May 2016


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Twitter Bars Intelligence Agencies From Using Analytics Service

Social media firm cuts access to Dataminr, a service used to identify unfolding terror attacks, political unrest

By Christopher S. Stewart and

May 8, 2016 7:54 p.m. ET


Twitter Inc. cut off U.S. intelligence agencies from access to a service that sifts through the entire output of its social-media postings, the latest example of tension between Silicon Valley and the federal government over terrorism and privacy.

The move, which hasn’t been publicly announced, was confirmed by a senior U.S. intelligence official and other people familiar with the matter. The service—which sends out alerts of unfolding terror attacks, political unrest and other potentially important events—isn’t directly provided by Twitter, but instead by Dataminr Inc., a private company that mines public Twitter feeds for clients.

Twitter owns about a 5% stake in Dataminr, the only company it authorizes both to access its entire real-time stream of public tweets and sell it to clients.

Dataminr executives recently told intelligence agencies that Twitter didn’t want the company to continue providing the service to them, according to a person familiar with the matter. The senior intelligence official said Twitter appeared to be worried about the “optics” of seeming too close to American intelligence services.

Twitter said it has a long-standing policy barring third parties, including Dataminr, from selling its data to a government agency for surveillance purposes. The company wouldn’t comment on how Dataminr—a close business partner—was able to provide its service to the government for two years, or why that arrangement came to an end.

In a statement, Twitter said its “data is largely public and the U.S. government may review public accounts on its own, like any user could.”

The move doesn’t affect Dataminr’s service to financial industry, news media or other clients outside the intelligence community. The Wall Street Journal is involved in a trial of Dataminr’s news product.

Dataminr’s software detects patterns in hundreds of millions of daily tweets, traffic data, news wires and other sources. It matches the data with market information and geographic data, among other things, to determine what information is credible or potentially actionable.

For instance, Dataminr gave the U.S. intelligence community an alert about the Paris terror attacks shortly after they began to unfold last November. That type of information makes it “an extremely valuable tool” to detect events in real time, the intelligence official said.

In March, the company says it first notified clients about the Brussels attacks 10 minutes ahead of news media, and has provided alerts on ISIS attacks on the Libya oil sector, the Brazilian political crisis, and other sudden upheaval in the world.

U.S. government agencies that used the Dataminr service are unhappy about the decision and are hoping the companies will reconsider, according to the intelligence official.

“If Twitter continues to sell this [data] to the private sector, but denies the government, that’s hypocritical,” said John C. Inglis, a former deputy director of the National Security Agency who left in 2014. “I think it’s a bad sign of a lack of appropriate cooperation between a private-sector organization and the government.”

Analysis of Twitter and other social-media services has become increasingly important to intelligence and law-enforcement agencies tracking terror groups. Islamic State posts everything from battlefield positions to propaganda and threats over Twitter. San Francisco-based Twitter deletes thousands of accounts a month for violating its antiterror policies, but Islamic State supporters create new accounts almost as quickly.

“The volume of the group’s activity on Twitter yields a vast amount of data that is a crucial tool for counterterrorism practitioners working to manage threats,” said Michael S. Smith II, chief operating officer of the security consulting firm Kronos Advisory. “Twitter’s decision could have grave consequences.”

In a speech last September, David S. Cohen, a deputy director of the Central Intelligence Agency, discussed the importance of “open source” social-media data gathered by the CIA, saying Islamic State’s “tweets and other social-media messages publicizing their activities often produce information that, especially in the aggregate, provides real intelligence value.”

Silicon Valley and the U.S. government have been locked in intensifying conflicts over cooperation since the revelations by former National Security contractor Edward Snowden about government surveillance of electronic communication.

Most recently, Apple Inc. and the Justice Department were embroiled in a legal showdown over demands by the Federal Bureau of Investigation to unlock an iPhone used by one of the killers in the San Bernardino, Calif., attack in December. That fight—which unlike the Dataminr product involved the release of private data—ended in March when the FBI found another way to access the phone.

In-Q-Tel, a venture-capital arm of the U.S. intelligence community, has been investing in data-mining companies to beef up the government’s ability to sort through massive amounts of information. In-Q-Tel, for example, has invested in data-mining firms Palantir Technologies Inc. and Recorded Future Inc.

U.S. intelligence agencies gained access to Dataminr’s service after an In-Q-Tel investment in the firm, according to a person familiar with the matter.

When a pilot program arranged by In-Q-Tel ended recently, Twitter told Dataminr it didn’t want to continue the relationship with intelligence agencies, this person said.

“Post-Snowden, American-based information technology companies don’t want to be seen as an arm of the U.S. intelligence community,” said Peter Swire, a Georgia Institute of Technology law professor and expert on data privacy.

Dataminr, based in New York, was launched seven years ago by three former Yale University roommates. A financing round early last year valued it at $700 million, according to Dow Jones VentureSource.

Its product goes beyond what a typical Twitter user could find in the jumble of daily tweets, employing sophisticated algorithms and geolocation tools to unearth relevant patterns.

Dataminr has a separate, $255,000 contract to provide its breaking news-alert service to the Department of Homeland Security, which is still in force.

—Yoree Koh contributed to this article.



The Democrats’ secretary of war

President Obama’s fourth defense secretary is looking a lot like he could be Hillary Clinton’s first.

By Austin Wright and Connor O’Brien

| 05/08/16 07:52 AM EDT


STUTTGART, Germany — After a Navy SEAL died in Iraq last week in an Islamic State attack, Defense Secretary Ash Carter was quick to hail him as a warrior who “died in combat.”

An ocean away, White House press secretary Josh Earnest offered a different take. While characterizing Carter’s remarks as “accurate,” Earnest said Special Warfare Operator 1st Class Charles Keating IV “was not in a combat mission, but he was in a dangerous place.”

The twin reactions to the latest U.S. casualty in the Middle East demonstrated once again that President Barack Obama and his more hawkish defense secretary aren’t completely in sync on the fight against the Islamic State of Iraq and the Levant, a war the White House is trying to downplay if not constrain.

Carter’s worldview puts him more in line with Democratic presidential front-runner Hillary Clinton than with Obama — and several analysts said Carter could be in the running to remain in his post should Clinton win in November, at least for a time. Others shot down the prospect as unlikely.

By all accounts, though, Carter is now in his dream job, the pinnacle of a career at the Pentagon that began in the early 1980s when he was a physicist working on nuclear weapons issues. And his status as Obama’s fourth Pentagon chief — the White House almost certainly wants to avoid having a fifth — gives him some room to stake out positions that might be more in line with the potential next administration than the current one.

During the year he has held the post, the 61-year-old Carter has publicly staked out the most aggressive stance of anyone currently in the Obama administration on what more it will take to wrest control of ISIL’s territory in Iraq and Syria — including more advisers and special operations troops to help Iraqi security forces and other allies to seize and hold on to ISIL strongholds in Mosul and Raqqa in Syria.

Anti-fracking demonstrators protest in New York City in September 2014.

That view aligns him closely with the more pugnacious former secretary of state, who during Obama’s first term was a strong voice for military action in Libya — and, as a presidential candidate, in Syria, where she has called for a no-fly zone.

“She tends to take a stronger view, along with [former Defense Secretary Robert] Gates, on some of these things, so I would say Carter’s views are very consistent,” said Arnold Punaro, a defense consultant and former staff director of the Senate Armed Services Committee who has close ties to Carter, including as a member of his Defense Business Board.

Carter also has old ties to the Clintons: His first political appointment to the Pentagon in the 1990s came from then-President Bill Clinton, and he contributed to Hillary Clinton’s presidential campaign in 2007 before switching to Obama after he clinched the nomination.

“Certainly all presidents want a smooth transition,” Punaro said. “There are advantages to having some key people stay on, even if it’s just a little while.”

Jacques Gansler, who was the Pentagon’s top acquisition official under Bill Clinton, said he would “certainly list” Carter among Hillary Clinton’s potential picks for defense secretary.

“I think that Ash would be a good one for Clinton because obviously he was there for Bill,” Gansler said. “She’s kind of hard-line, and I think he’s going to want to strengthen our security posture.”

Others said new presidents like to clean house — and that Obama’s decision to retain Gates, a holdover from the Bush administration, was a rare exception, not the rule.

“It’s not gonna happen,” one administration official, speaking on the condition of anonymity, said of the possibility of Carter sticking around under Clinton. A former senior defense official, also speaking on the condition of anonymity, said Clinton would probably “want to make her own choice.”

Both sources said Michèle Flournoy, a former undersecretary of defense for policy who runs the Center for a New American Security, would be the clear front-runner to helm the Pentagon if Clinton wins in November. Other possibilities they listed were Democratic Sens. Jack Reed of Rhode Island and Jeanne Shaheen of New Hampshire.

Gates himself, in his 2014 memoir, wrote that Obama’s decision to retain him was “uncharted waters.” There was “no precedent, since the creation of the Defense Department in 1947, for a sitting secretary to stay on in a newly elected administration, even when the same party held on to the White House,” Gates wrote, describing a secret meeting with then-president-elect Obama at a firehouse near Reagan National Airport in Northern Virginia.

Carter and Clinton have both been pushing for a more muscular response to ISIL.

For her part, Clinton has called for sending more U.S. special operations forces to Iraq and Syria and a stepped-up bombing campaign.

And Carter has repeatedly said he’s looking for ways to do more.

The Pentagon chief traveled to Europe last week to secure more contributions from allies for the fight against ISIL. His tough talk extends beyond the Middle East.

In a change-of-command ceremony for the U.S. European Command, he had strong words for Russia — a country he has been studying since his early days in the Pentagon during the Cold War against the Soviet Union.

“We do not seek a cold, let alone a hot war with Russia. We do not seek to make Russia an enemy,” Carter said. “But make no mistake, we will defend our allies, the rules-based international order, and the positive future it affords us.”

The Pentagon chief has long been known for his hawkish views within the Democratic establishment, famously calling in 2006 for preemptive, targeted strikes against North Korea if it continued preparing for a test launch of a long-range ballistic missile. In 2011, as the deputy to then Defense Secretary Leon Panetta, Carter helped press Panetta’s case to leave some U.S. troops in Iraq — a case that received pushback from Obama’s White House and was ultimately unsuccessful, as Panetta chronicled in his own 2014 memoir.

“One of the great uncertainties is how much political support Carter has in the administration,” Anthony Cordesman of the Center for Strategic and International Studies said of Carter’s efforts to ratchet up the campaign against ISIL. “He is the secretary of defense. Has he been a voice for a stronger and more effective military posture? Yes.”

“I think he’s probably one of the more outspoken advocates in the White House on finding ways to dial it up,” added Shawn Brimley, executive vice president and director of studies at the Center for a New American Security. “Secretary Carter and others feel that we can do more.”



Defense Bill Has Nuclear Facilities Fighting Drones

Joe Gould, Defense News 8:02 a.m. EDT May 7, 2016


WASHINGTON — As US regulators grapple with the safety, privacy and national security concerns posed by a boom in the use of recreational drones, lawmakers worried about their use for malicious ends have advanced legislation aimed at letting Defense Department and Energy Department facilities defend themselves against them.

Two provisions contained in the 2017 National Defense Authorization Act would extend broad new authorities to the agencies to stop unmanned aerial vehicles deemed a threat to their facilities dedicated to nuclear power and weaponry. The authorities would dovetail with DoE and DoD’s early efforts to develop technology that would discern small drones from birds and take them out.

“That is a very aggressive approach, and one we have yet to see in federal regulations,” energy and infrastructure attorney Roland Backhaus, with the firm Pillsbury Winthrop Shaw Pittman, said of the bill.

While the US Federal Aviation Administration has yet to report any serious incident involving a drone at a nuclear facility, fears and speculation have been fueled by a commercial quadcopter’s crash landing on the White House lawn last year, and a Massachusetts man’s guilty plea in 2012 to plotting attacks on the Pentagon and US Capitol building with an explosive-laden model plane.

Drones reportedly buzzed nuclear facilities around France 32 times over two months in 2014, according to a report commissioned by Greenpeace, sparking concern the country’s nuclear reactors are unsafe from aerial assaults and jangling nerves in other nations about the potential threat.

Unmanned aerial systems (UAS) small enough to elude radar could be used “by criminals and terrorists” to attack or spy on “critical government and industrial facilities,” according to a Jan. 27 Congressional Research Service report. “Somewhat larger UAS could be used to carry out terrorist attacks by serving as platforms to deliver explosives or chemical, biological, radiological, or nuclear weapons,” said the report, by aviation policy specialist Bart Elias.

Taking no chances given the devastation that could be wrought at such a facility, House Armed Services Committee (HASC) strategic forces subcommittee chairman Mike Rogers, R-Ala., included the two counterdrone provisions in the 2017 NDAA, which the HASC approved April 28.

“The bottom line is the members are tracking the increased prevalence and sophistication of unmanned aerial systems around the country, and they understand the threat these can pose to certain defense facilities,” said a congressional staffer.

DoE has 10 active sites across the country that handle the US arsenal of nuclear weapons and material, while DoD controls nuclear missile fields, silos, underground storage and maintenance, as well as nuclear reactors for training and research.

“The chairman is interested in protecting these facilities. It would be a bad day if something happened,” the staffer said.

The massive defense policy bill has several hurdles before it becomes law. The language would have to survive a vote on the House floor and reconciliation with the Senate bill due later this month. The reconciled bill will face a vote in both houses of Congress and must be signed by the president.

Under the bill’s mandate for DoD, the defense secretary would develop a means to disrupt, seize, confiscate, control, disable or destroy drones deemed a threat to facilities related to nuclear deterrence, missile defense or the national security space mission.

For DoE, personnel and contractors who think a drone presents “a threat to people, property, or classified information” at a facility that stores or uses special nuclear material would be allowed to “mitigate the threat from, disable, interdict, interfere with” its operation. It varies by DoE facility, but most are operated by private contractors, and physical security is generally provided by third-party companies.

Lawmakers don’t mean to encourage the shooting down of drones, and while the bill permits DoE to do it, its language discourages the use of force in favor of “appropriate escalation,” saying “non-kinetic responses should be utilized when feasible to mitigate a threat.”

An FAA spokesman declined to comment on the pending legislation, but had this to say:

“Generally, shooting at any aircraft — including unmanned aircraft — poses a significant safety hazard. An unmanned aircraft hit by gunfire could crash, causing damage to persons or property on the ground, or it could collide with other objects in the air.”

The legislation comes as federal agencies have been waiting for the FAA to carve out security-based rules for drones, a step mandated by law in 2013. In the meantime, an FAA notice strongly advises pilots of airplanes and drones to avoid — and not “circle or loiter” in — the airspace of critical infrastructure, such as power plants, military bases and prisons.




Many interested parties are watching this space, including federal agencies, security contractors, nuclear facility operators and drone manufacturers — which are looking into geo-fencing software for a UAS to steer itself away from an off-limits area.

“With this opportunity for DoE to take a more aggressive approach, one wonders if this same approach would not get picked up by operators of sensitive facilities, nuclear or otherwise,” Backhaus said.

According to a market survey performed by Sandia National Laboratories, the DoE research and development wing, a variety of means exist to detect, identify and neutralize a slow- and low-flying UAS — sophisticated sensors, high-energy lasers and signal jammers, water cannons, firearms and trained birds of prey.

There is still key research and development to be done in this sector, according to the counter-UAS (CUAS) survey. It concluded that differentiating targets from background clutter is a problem for existing technology, and that “no complete system appears to exist with evidence of acceptable performance.”

Sandia in March announced it wants CUAS vendors to loan their equipment for testing and evaluation, to determine their suitability for “various security installations.” The CUAS would target systems that fly slow and slow, and weigh less than 55 pounds.

DoD is also interested in the capability. The US military has since 2010 been conducting its annual Black Dart exercises at Naval Base Ventura County, California, to test a variety of UAS countermeasures.

During an April visit to Naval Submarine Base Kings Bay, Georgia, Deputy Defense Secretary Bob Work expressed concern about small drones being able to penetrate the security at nuclear missile and submarine bases nationally.

Although Work spoke broadly, he did call out a program in the Netherlands — run by a company called Guard From Above — that uses birds to take out small drones around nuclear power sites as a particularly interesting idea. Kings Bay already uses dolphins to spot any potential underwater threats to the nuclear sub fleet housed there.

Air Force Global Strike Command, which manages the US’ nuclear arsenal, awarded a $75,000 contract for portable systems to counter personal drones to XCOM Wireless, of Long Beach, California, in January. The Air Force solicited a system to disrupt the navigational signals of a “wide range” of UAS targets and minimize collateral effects on friendly assets.


Keep It Secret: Congress Should Back Off the B-21 Program

May 9, 2016 By Mackenzie Eaglen

Lawmakers’ calls for more transparency and fixed-price contracts will only hurt an Air Force acquisition effort that is doing well so far.


Five times in April, Russian military forces flexed their muscles against American military personnel out on patrol, repeatedly conducting dangerous barrel rolls over an Air Force recon aircraft and buzzing a U.S. Navy destroyer on patrol in the Baltic. Yet instead of helping to craft a response to these uncontested provocations, Congress is threatening to upend the Air Force’s crucial bomber program just as it takes off after a decade of failed launches.

As Congress debates its annual 2,000-page defense authorization bills this month, one issue in particular will likely go all the way to a formal White House veto threat. That disagreement is the Senate’s push for the Air Force to publicly disclose its cost estimate for its new B-21 bomber. For operational secrecy, the Air Force legitimately refuses to reveal how far under the original cost estimate the development phase currently is — hardly your typical “defense acquisition gone wild” headline.

But this is not a simple accounting or transparency dispute. Congress wants the Air Force to give away the “crown jewels” of a necessarily secretive program. The past two decades saw continued breaches of major American weapons programs—think the C-17 airlifter and F-35 fighter—by the Chinese and others. This theft of state secrets allows adversaries to plan and build cheaper, faster counters to U.S. technology. The openness and insecurity of the Pentagon’s acquisition system contributes directly to the rapid erosion of the U.S. military’s technological edge.

Worse, unneeded transparency risks sacrificing a national military advantage for no tangible gain. Because weight and cost are so closely correlated for aircraft development, revealing the final cost estimate could allow adversaries to piece together a useful sketch of the bomber’s range, payload, and most importantly for stealthy aircraft, its size. Additionally, the B-21’s secrecy so far helped it avoid the “requirements creep” and gold-plating that could initiate the program’s spiral into failure, as happened with the DDG-1000 Zumwalt destroyer and Expeditionary Fighting Vehicle.

The reality is that Congress has successfully overseen highly classified programs for decades and could ably do so for the B-21 bomber. While public disclosure is often conducive to oversight, it can hamper certain weapons programs, encouraging political tampering that engenders cost overruns, schedule delays, and over-sharing of critical technical details.

If public debate on the bomber’s cost is necessary, will Congress treat classified Navy and Army programs similarly? Unlikely, given that the Air Force’s bomber replacement has always fought for every scrap of support both in the Pentagon and on Capitol Hill. After numerous misfires and cancellations since 2005, America’s airmen can finally point to a promising, cost-effective program in the B-21. The program is poised to beat both its development and production cost targets and finally meet the Air Force’s demonstrable and growing need for a large fleet of kick-down-the-door penetrating bombers.

A second challenge from the Senate Armed Services Committee is likely to venture deeper beyond award cost into contract type. Chairman Sen. John McCain, R-Ariz., believes the Air Force used the wrong contract for the program’s development. The “cost-plus” contract currently in place pays the contractor as it performs work. These contracts are often used for the risky development phase when a cost estimate is very difficult to get right. By contrast, McCain wants the Air Force to use a “fixed-price” contract where the Air Force and the contractor set a price and any cost increase above that comes from the company’s coffers.

Backseat driving on the B-21 contract will further delay the program and quite possibly lead to the same cost overruns Congress wants to avoid.

Left unsaid is that the Air Force has already indicated that the entire production phase of the bomber program—70 percent or more of its total cost—will be conducted on a fixed-price basis.

Fixed-price contracts work well for the production of low-complexity aircraft and vehicles with large commercial and foreign sales prospects. Yet misapplied fixed-price aircraft development programs have encountered great difficulty—for example, the F-111, V-22, C-5, C-17, and A-12 aircraft programs.

While critics of the Air Force cite the success of a fixed-price contract in making Boeing pay for development overruns on the new KC-46A aerial tanker, this argument elides the fact that the bomber is far more complex than the tanker and Boeing was willing to sign any contract, no matter how harsh, to keep Airbus out of the American tanker market.

Even as this high-risk, low-reward argument goes on, Congress continues to ignore real egregious contracting mishaps such as the “lowest price, technically acceptable” solicitation for a $17.5 billion IT contract.

In short, for a promise of small cost savings unlikely to materialize, backseat driving on the B-21 contract will certainly further delay the program and quite possibly lead to the same cost overruns Congress wants to avoid.

The B-21 bomber has already suffered six months of “process” delay resulting from a failed Lockheed/Boeing bid protest in late 2015. The U.S. Air Force—and more importantly the entire joint force—cannot afford further delays in fielding this foundational capability for 21st-century power projection.

The Air Force’s new bomber is a necessary American strategic asset and essential investment. We risk sacrificing deterrence and actually losing in war without the B-21.



DIUX Expands to Boston, with New Leadership

Aaron Mehta, Defense News 1:40 p.m. EDT May 11, 2016


WASHINGTON — Defense Secretary Ash Carter is rebooting his Silicon Valley outpost, with a new leadership council and expansion to a second location in Boston.

The Defense Innovation Unit Experimental (DIUX) will also now report directly to Carter, sidestepping an internal Pentagon bureaucracy that sources say has been cold, if not outright hostile, to the Silicon Valley-based group.

Defense News broke the news of DIUX’s expansion and leadership changes earlier Wednesday.

“I believe that doing business with the tech industry forces DoD to look ourselves in the mirror, which is healthy for any organization,” Carter said in remarks delivered at Moffat Field in California. “In this case, it’s helped us identify not only successes, but also some shortcomings, both in how we engage with tech companies here, and in the tools we use to accelerate the uptake of technology into the department.”

“Armed with this knowledge, we’re taking a page straight from the Silicon Valley playbook: We’re iterating, and rapidly, to make DIUx even better,” he continued. “As a result of all this great experience and in view of technology’s and the world’s imperative to stay agile, today we’re launching DIUx 2.0.”

That includes opening an outpost in Boston and a promised upgrade for DIUX’s “processing power” — it’s funding, according to Carter. However, the secretary did not put more details on funding numbers.

But perhaps the most important change is that DIUX will report directly to Carter and not go through the traditional Pentagon system. Sources have said DIUX has been hamstrung by internal forces inside the Pentagon, and giving program officials a direct line to Carter may act as a workaround to that problem.

“Early on, they didn’t give DIUX any money or contracting authority. You can’t have an organization on the West Coast micromanaged from OSD [the Office of the Secretary of Defense] and think it’s going to be successful,” one source with knowledge of the situation said. “The Pentagon sees everything in power balance views of bureaucracy and they don’t see it in long-term security issues.”

Carter also indicated that DIUX will now interface with groups — unnamed, but likely to include DARPA and the Strategic Capabilities Office — that form the core of the department’s R&D braintrust.

“I’m directing DIUx to work closely with DoD’s rapid acquisition cells and R&D community. DIUx will be a test bed for new kinds of contracting with start-up firms,” Carter said. “They’ll work quickly to execute time-sensitive acquisition programs. And they’ll move at the speed of business — we know how fast companies run here, and in other tech hubs around the country, and we expect DIUx 2.0 to run alongside them.”


Leadership Change

As part of the reboot, Carter announced a new leadership structure for the unit that he described as a “partnership-style leadership structure,” replacing director George Duchak.

Raj Shah, a former F-16 pilot and special assistant in the Office of the Secretary of Defense, will be the new managing partner of DIUX. He was most recently senior director of strategy at Palo Alto Networks. He will be joined by three other partners on the board:

Vishaal Hariprasad, an Iraq War vet who was awarded the Bronze Star and was the former technical co-founder and director of software engineering for Morta Security.

Christopher Kirchhoff, who served as director for strategic planning at the National Security Council as well as special assistant to the chairman of the Joint Chiefs.

Isaac Taylor, former head of operations for Google X, the Internet giant’s R&D arm. This is another tie between the Pentagon and Google, as Eric Schmidt, executive chairman of Google parent company Alphabet, is the founding member of Carter’s new Defense Innovation Advisory Board.

“We’re taking yet another page from the Silicon Valley playbook, and making the leadership structure of DIUx as flat as any start-up here in the Valley,” Carter said.

Shah, speaking after Carter, talked about the frustrations he felt while flying F-16s loaded with old technology, while commercial pilots had better, and faster, technology. That, he said, is an example of how innovation from outside the Pentagon needs to be incorporated faster.

In addition to the leadership change, Carter announced the creation of a reserve unit at DIUX, led by Navy Reserve Commander Doug Beck, a veteran of Iraq and Afghanistan who, in his non-reserve life, serves as Apple’s vice president for the Americas and Northeast Asia.


The details of that unit were not revealed in Carter’s speech. It is also unclear how the new Boston outlet fits into the new DIUX leadership structure.

As for Duchak, it is not clear what his role will be going forward. While Carter praised his work in getting the unit off the ground and said Duchak would be returning to Washington — “we look forward to his continued service at the Pentagon, where I’ve asked him to leverage his experiences here to help expand innovative practices in other areas of DoD” — it is hard not to view the move as an admission that Duchak’s leadership of DIUX was not getting the job done.



Air Force to develop apps that will last 100 years

Michael Peck, C4ISR & Networks 11:35 a.m. EDT May 11, 2016


The U.S. Air Force has awarded a $7.8 million contract to develop mobile applications that will be viable for 100 years, regardless of changes in mobile devices and operating systems.

The contract, part of DARPA’s Building Resource Adaptive Software Systems program, was awarded to a team led by Raytheon BBN Technologies, according to a Raytheon news release. Among the goals is to develop technology that will modify software as needed to stay current.

“Mobile apps are pervasive in the military, but frequent operating system upgrades, new devices and changing missions and environments require manual software engineering that is expensive and causes unacceptable delays,” said Partha Pal, principal scientist at Raytheon BBN. “We are developing techniques to eliminate these interruptions by identifying the way these changes affect application functionality and modifying the software.”

The Raytheon team includes Securboration, Inc., Oregon State University, Vanderbilt University and Syracuse University.




How crowdfunding can help save Silicon Valley from its harebrained investors

By Vivek Wadhwa

May 12 at 7:10 AM


There are fears that another Ice Age is about to hit Silicon Valley because of the implosion of its unicorns — start-ups valued at more than one billion dollars. By one estimate there were 229 such companies in January of this year. Their valuations are dropping precipitously because they were overpriced and overhyped. The fear is that venture capital will dry up and hurt the innovation ecosystem.

In previous eras, such a setback to venture capitalists would surely have had a chilling effect on the innovation ecosystem because startups were dependent on their funding. But in today’s era of exponential technologies, there will hardly be a blip.

To start with, the cost of building new technologies has dropped so significantly that inventors no longer need venture capital. The desktop computers, server farms, racks of hard disks, and enterprise software that were needed would cost hundreds of thousands, sometimes millions, of dollars. Today, there is on-demand computing and cloud storage — which can be purchased for almost nothing from companies such as Amazon, Google, and Microsoft. And tools such as sensors and 3D printers, which are needed for building sophisticated medical devices and robots, are inexpensive. What costs the most in Silicon Valley is rent and food. But you can share an apartment and live on pizza and ramen noodles.

And instead of begging venture capitalists, angel investors, or friends for the $50,000-100,000 that it typically costs to start a technology company, founders can go directly to the people they are building their products for. They can post a video of a heart-felt pitch and demonstrate a prototype of their ideas on sites such as Indiegogo, Kickstarter and Plum Alley. If they get funded they’ll know they have a good idea; otherwise is time to go back to the drawing board and come up with something better.

The crowd makes better decisions than venture capitalists do. With crowdfunding, there is direct feedback from the market and a strong connection between the inventor and the funder. The community of funders feels a sense of ownership for the product and helps spread the word. And there is no filter such as a venture capitalist who has his own race and gender biases and only invests in the same trendy technologies as other VC firms.

The failure rate of crowdfunded projects is remarkably low. Three quarters of venture capital investments fail to return investor capital. Yet only 9 percent of crowdfunded projects fail to deliver on what they promised, according to Ethan Mollick of University of Pennsylvania –who researched 47,188 Kickstarter projects.

When entrepreneurs take money from venture capitalists, they know that this is coming from deep pockets and is just a financial investment. When dealing directly with customers it is personal; so entrepreneurs put in extraordinary effort and spend their own money to fulfill their promises. This is what leads to better outcomes.

One of the best examples of a technology that would not have seen the light of day without crowdfunding is virtual reality. As Mollick explained, this was largely ignored by traditional funders after it failed to gain traction in the 1990s. In 2012, a 19-year old Palmer Luckey, who had built a prototype of a virtual reality headset in his parent’s garage, launched a Kickstarter campaign for a commercial product. His goal was to raise $250,000 but there was so much demand that he ended up getting $2.4 million in orders. The product he later developed, Oculus Rift, was acquired by Facebook in 2014 for $2 billion. This set off a frenzy of funding by venture capitalists and greatly accelerated the progress of a world-changing technology.

So far, there have been limits to what start-ups could offer the crowd. They could only pre-sell their product and offer perks such as T-shirts and badges. This is about to change.

Starting May 16, the Securities and Exchange Commission is rolling out a new program that will allow private companies to use crowdfunding to sell securities — up to $1 million over a 12-month period. This was a provision of the 2012 Jumpstart Our Business Startups Act (or JOBS Act) to assist small companies with capital formation.

Individual investors with less than $100,000 of net worth will be allowed to invest the lesser of $2,000 or five percent of their annual income or net worth. Wealthier individuals can invest up to 10 percent. The investment must, however, be through an authorized funding portal. These portals are required to vet the companies and let investors shop among offerings and discuss them online. They can’t offer investment advice, make recommendations, or solicit purchases.

One of the first funding portals, Crowdfunder didn’t waste time in taking advantage of the new rules. It recently announced a VC Index Fund which offers an investment in a portfolio of hundreds of venture-capital backed startups. Crowdfunder chief executive Chance Barrett said his goal was to “allow everyday people to invest online alongside the world’s leading venture capitalists, while targeting a fund 10x more diverse, in the number of investments, than a traditional VC.” In other words, the public can become “super VCs.”

It remains to be seen if equity crowdfunding achieves the same success as product crowdfunding. The stakes are now higher and the risks of fraud are much greater. But one thing is certain: the balance of power is rapidly shifting — from venture capitalists to entrepreneurs. This is a good thing because it will lead to a greater diversity of start-ups. And with a bit of luck, there will also be fewer over-priced unicorns and less wastage of investment capital — because the venture capitalists will follow the crowd.


Senate Defense Bill Would Blow Up DoD Acquisition Chief’s Job

Joe Gould, Defense News 10:10 p.m. EDT May 12, 2016

FY ’17 NDAA, In Surprise Move, Would Create New Pentagon Innovation Boss


WASHINGTON — Senate Armed Services Chairman John McCain is seeking to erase the office of the Pentagon’s chief weapons buyer and divide its duties between two positions, one of them a new chief technological innovator for the Defense Department.

The move in his version of the defense policy bill, approved by the committee Thursday as part of the 2017 National Defense Authorization Act, blows up the position of undersecretary of defense for acquisition, technology, and logistics — currently held by Frank Kendall — and hands its duties to a new undersecretary of defense for research and engineering, or USD(R&E), and the renamed undersecretary of management and support, or USD(M&S).

The far-reaching move surprised analysts, whose reactions rippled across social media on Thursday evening.

“I had to read that section twice,” read a tweet from Center for a New American Security’s Technology and National Security Program director, Ben FitzGerald. “Getting rid of USD AT&L is a big deal. HASC & SASC not messing around with this year’s NDAA.”

The USD(R&E)’s job would be to champion technological innovation for DoD, deemed crucial amid fears the US military — hindered by its acquisition structure — is losing its technological dominance and “unable to access new sources of innovation,” according to a summary and statement that followed the closed-door markup of the bill.

The summary touts the shakeup as, “providing a greater role for the Office of the Secretary of Defense to lead on innovation and provide effective and targeted oversight on major weapon systems programs.”

Drawing a comparison to the technological competition between the US and Soviet union during the Cold War, the idea for the new innovation chief to be “restoring, elevating, and enhancing the mission of defense technological innovation.”

“The committee expects that just as previous USD(R&E) incumbents led the ‘Second Offset’ strategy, which successfully enabled the United States to leap ahead of the Soviet Union in terms of military technology, the new USD(R&E) would be tasked with driving the key technologies that must encompass what defense leaders are now calling a ‘Third Offset’ strategy: cyber and space capabilities, unmanned systems, directed energy, undersea warfare, hypersonics, and robotics, among others,” the summary reads.

The heads of the following offices and agencies would report directly to the USD(R&E): the Defense Advanced Research Projects Agency; the Strategic Capabilities Office; the Defense Threat Reduction Agency; the Missile Defense Agency; and the existing Assistant Secretary of Defense for Nuclear, Chemical, and Biological Defense, because of the centrality of the nuclear modernization mission.

Whereas the new USD(R&E) would be a staff office focused on innovation, oversight, and policy for the development of national security technology and systems, the revised USD(M&S) would be a line office focused on running defense agencies that perform the Pentagon’s critical business operations.

The bill, if passed, would also reorganize the DoD’s Office of Test and Evaluation by transferring the functions of the Deputy Assistant Secretary of Defense for Developmental Test and Evaluation and the director of the Department of Defense Test Resource Management Center to the director of Operational Test and Evaluation.

Other parts of the measure are aimed at improving DOD’s access to non-traditional commercial and global innovation through more streamlined and commercial-like processes, making it easier for DoD to buy commercial items and deal with commercial firms.


Rasmussen Reports

What They Told Us: Reviewing Last Week’s Key Polls

Saturday, May 14, 2016

Republicans tried to make nice this week, while Bernie Sanders prolonged Hillary Clinton’s electoral agony with a win in West Virginia. But voters are already focused on November.

The media may portray Sanders as a continuing political threat to Clinton, but voters aren’t buying: They remain overwhelmingly convinced that Clinton is the likely Democratic presidential nominee for 2016.

Ask voters who is likely to be the next president of the United States, Clinton or Donald Trump, and it’s very close. Unaffiliated voters give the edge to “The Donald.”

Rasmussen Reports’ most recent national matchup of the two, posted 12 days ago, found Trump edging slightly ahead of Clinton. Other polling firms have confirmed the tightening of the race since then.

Trump is now the presumptive Republican nominee for president. If you had told voters that would be the case when he began his campaign last June, they’d probably have thought you were crazy. But our weekly Trump Change survey has proven to be an accurate barometer of what America’s been thinking about him ever since.

Trump met this week with House Speaker Paul Ryan, the highest-ranking GOP member of Congress. Ryan has expressed reservations about endorsing Trump, but voters aren’t that concerned about what he thinks. 

Just last month, some top Republicans still viewed Ryan as an alternative nominee to Trump. Ryan loses to both major Democratic candidates in head-to-head matchups, however, with roughly a quarter of Republicans looking somewhere else.

GOP voters feel even more strongly that the candidate with the most delegates should be their nominee, but Democrats now tend to support their party’s delegates voting for whomever they want at the party’s convention.

Sanders’ unexpected success in the 2016 presidential campaign has exposed the growing rift between the Democratic party establishment and the party’s more progressive wing. Still, Democratic voters are more likely than voters in general to think their party should identify with Clinton rather than Sanders.

Voters tend to think Clinton will work better with the United States’ allies if elected president but are evenly divided over whether she or Trump will be tougher with this nation’s enemies.

Trump has rattled some in the national security hierarchy of both major political parties with his call for returning to an America First foreign policy. Most voters agree the United States has not been putting its own interests ahead of others and should reverse course.

Voters remain lukewarm about Obama’s national security policies and expect more of the same if Clinton moves back into the White House next January. Trump, if elected, will definitely change things, voters say, but not necessarily for the best.

Vice President Joe Biden told an interviewer this week that he would have made the best president if he had chosen to run this election year, but most voters disagree.

The Obama administration reportedly is speeding the vetting process for Syrian refugees so 10,000 can come to the United States this year. Most voters still don’t welcome the newcomers from Syria and fear they are a threat to the country.

A federal court on Thursday knocked down a key provision of Obama’s national health care law. Just 13% of voters want to leave Obamacare as is. The rest want to repeal the law or improve it piece by piece.

A legal battle is escalating between the U.S. Justice Department and North Carolina over the state’s bill that would ban individuals from using public restrooms that do not correspond to their biological gender. What do Americans think of the transgender bathroom debate?

While many of the president’s policies and pronouncements remain unpopular with voters, his lame duck status seems to be keeping his daily job approval rating at better than usual levels. 

In other surveys last week:

— Just 27% think the country is heading in the right direction.

— Following several airbag recalls for major automakers, Americans are slightly less trusting of the airbags in their cars.

Fifty-eight percent (58%) have been involved in a traffic accident while driving, and that number increases to 64% among those who say they drive every day or nearly every day.

— Despite increasing moves to legalize marijuana around the country, Americans remain closely divided on the issue but are in a less punishing mood about use of the drug.

— California is the latest state to raise its minimum age for buying tobacco products to 21, and Americans are on board. Young Californians can still vote and join the military to fight for their country at age 18, but they’ll have to wait a little longer if they want to buy cigarettes.

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