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Silicon Valley Takes on the 'Valley of Death' – National Defense Magazine

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National Defense provides authoritative, non-partisan coverage of business and technology trends in defense and homeland security. A highly regarded news source for defense professionals in government and industry, National Defense offers insight and analysis on defense programs, policy, business, science and technology. Special reports by expert journalists focus on defense budgets, military tactics, doctrine and strategy.
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SIMI VALLEY, Calif. — The commercial technology sector wants to help the U.S. military acquire new capabilities. But if the Pentagon doesn’t change the way it does business soon and help innovators bring their products across the “Valley of Death,” they will go belly up or walk away, industry and military leaders are warning.
The Defense Department has launched a slew of initiatives in recent years aimed at expanding its innovation base and bringing startups and nontraditional companies based in Silicon Valley and elsewhere into the fold. But there’s a problem — promising technologies still often fail to move beyond the research-and-development phase and into large-scale procurement. The phenomenon is known in defense acquisition circles as the Valley of Death.
The problem — and the need to fix it — was front and center at the recent Reagan National Defense Forum, the annual confab of national security elites in Simi Valley, California.
“Let’s face it. For far too long, it’s been far too hard for innovators and entrepreneurs to work with the department, and the barriers for entry into this effort to work with us in national security are often too steep — far too steep,” Secretary of Defense Lloyd Austin III said during his keynote address.
“Let’s say some great California startup develops a dazzling way to better integrate our capabilities. All too often, that company is going to struggle to take its idea from inception to prototype to adoption by the department,” he added. “We call this syndrome the Valley of Death, and I know that many of you in this room are painfully familiar with it.”
The phenomenon deters some innovators from ever trying to do business with the Pentagon, he noted.
Undersecretary of Defense for Research and Engineering Heidi Shyu said there isn’t a dearth of high-tech firms that want to work with the military.
“Looking around in terms of number of companies, I don’t see a shortage of innovation. Where I see the problem is they get seed money to develop designs and prototypes, and they die on the vine, because our acquisition system is too rigid,” she said during a panel at the forum.
As an example, Shyu noted her recent visit to a small business in Santa Monica, California, working on what she dubbed a “superb product.”
“They said, ‘We’re running out of money,’” Shyu recounted without identifying the company. “I said, ‘Hello, you’re just telling me today?
You think I have a bank account I can open up and give it to you tomorrow?’”
“That’s the problem,” she continued. “They have venture capitalists that are interested in putting funding in them [but only] if they have production contracts. So, it’s the Valley of Death. They have a design, the prototype won’t be ready for another year and a half, right? So I’m … trying to figure out how I can find them some money to bridge them over.”
There are two key metrics for assessing the Pentagon’s relationship with the national security innovation base, said Air Force Chief of Staff Gen. Charles “CQ” Brown Jr. One is access to innovators, and the other is the ability to transition desirable capabilities into large-scale production.
“The access is actually pretty decent and pretty good. So, a lot of dialogue and discussion. But the transition is where we fail and fall really short,” he said.
There’s a lot of excellent innovation on one side of the Valley of Death. “We just can’t get it to the other side of the valley and scale it,” he added.
In recent years, the Pentagon has ramped up its use of other transaction authority agreements after Congress passed legislation in 2015 and 2016 encouraging their use. OTAs are intended to cut through bureaucratic red tape associated with the Defense Department’s more traditional acquisition processes and facilitate rapid prototyping and follow-on production. The total value of OTAs awarded in 2020 topped $16 billion, according to decision science company Govini.
However, production OTAs account for just a tiny fraction of total OTAs awarded, according to the Center for Strategic and International Studies. The vast majority are for R&D and prototyping.
Additionally, projects initiated under the Small Business Innovation Research program, which Austin said the Pentagon is “doubling down” on to help small companies work with the department, often struggle to find funding after they reach the end of their SBIR Phase 2 contracts because they are not connected to a program office, officials have noted.
Nevertheless, the Pentagon has had some successes in helping nontraditional firms get their technologies across the Valley of Death. For example, in 2020 the Defense Innovation Unit — which is based in Silicon Valley and has outposts in other commercial tech hubs around the country — facilitated the transition of 11 successful commercial prototypes to other Defense Department agencies for large-volume procurement. From its inception in 2015 to 2020, the organization successfully transitioned a total of 26 commercial solutions, according to DIU.
But much more needs to be done, industry insiders say.
“Time is running out with Silicon Valley,” warned Katherine Boyle, general partner at venture capital firm Andreessen Horowitz, also known as a16z, which is based in the region.
“After five years of DoD saying, ‘We want to work with the best startups,’ we have, at most, two years before founders walk away and private capital dries up. And many, many startups will go out of business waiting for DoD to award real production contracts,” she said in a tweet storm when the Reagan National Defense Forum kicked off.
“Experienced founders and investors know that until you have a production contract, these [other awards] are … little door prizes,” she added.
Billions of dollars in venture capital have gone to defense-focused companies, but the Defense Department is dropping the ball, according to Boyle. That has implications for the workforce.
“Early-stage startups are waiting, and many will languish after getting OTAs and pilot contracts that felt real but weren’t,” she said. “While investors will give a handful of these companies the benefit of the doubt, you’re going to see talented, hard-working teams go bankrupt and head back to Facebook and Google.”
To address the problem, the Pentagon needs to award production contracts to “the most important startups with the teams who’ve proven they can build,” she said. “These don’t have to be big contracts. But they have to be real production contracts that show founders and investors that DoD is serious.”
The Defense Department also needs to change the “culture” of procurement, Boyle said, noting that acquisition officers face blame if they bet on a startup and it doesn’t pan out. Instead, officials should be incentivized to work with venture-backed startups that can create technologies that warfighters need, she argued.
The Pentagon can’t continue with business-as-usual as adversaries roll out new high-tech capabilities, Boyle warned.
“The future of American national security depends on us finding a way to solve this procurement crisis,” she said.
Joe Lonsdale, co-founder and managing partner at venture capital firm 8VC, said investors need to see results if they are going to keep bankrolling companies that are trying to work with the military.
“There’s a lot of money that has gone to work in the venture capital ecosystem the last three, four, five years, in part inspired by a lot of these smaller programs that have helped get things going,” he said.
Investors want to know “is this an area where people can actually make money?” he added. “A lot of people have a lot of minor work. And so far, we haven’t seen the big wins. … It is a critical moment to figure this out.”
Contributing to the problem is what Lonsdale described as a “lack of courage” in the Defense Department when it comes to picking winners and losers in the commercial tech sector.
Brown said the Pentagon needs to select some key programs and shepherd them across the Valley of Death to encourage organizations in the innovation ecosystem.
“When they get to the other side of the valley, we’ve got to continue to nurture them to show some success because if we don’t do that, then I really believe all that venture capital is just going to walk,” he said. “They’re going to find someplace else to go.”
Marine Corps Commandant Gen. David Berger said he is already hearing anecdotal stories of companies bailing.
“Two of the CEOs that I know that I talked to, I asked them, ‘How’s it going you guys?’ They said, ‘It’s bad,’” Berger told reporters at the forum. “They’re going to take their money and go do commercial stuff because they can’t see where the return on investment is going to be. … That worries me.”
Shyu said problems associated with the Pentagon’s planning, programming, budgeting and execution process, known as PPBE, is hindering the department’s ability to quickly deliver promising capabilities to warfighters.
Her office is planning to conduct a rapid joint experimentation campaign with products from innovators that combatant commanders are interested in. The hope is that they can move to rapid fielding. But in the past, that has been a challenge because “there’s no transition budget,” she said.
“Let’s say the [combatant commands] love that capability and they want it. … Well, I have to go back to the service and say, ‘Did you POM for that?’” Shyu said, referring to the program objective memorandum that lays out multi-year plans for resourcing projects.
The 2022 National Defense Authorization Act recently passed by Congress directs the establishment of a new commission tasked with comparing the PPBE process of the Defense Department with similar processes of private industry, other federal agencies and foreign nations, and making recommendations for improvement.
In the meantime, Shyu is asking for some “bridge funding” to get systems across the Valley of Death, although she didn’t disclose how much money she’s seeking.
“This is something that I’ve got to work internally within the DoD and I’ve got to work with the Hill because they want to … count every penny that we have,” she said.
Rep. Ken Calvert, R-Calif., ranking member of the House Appropriations defense subcommittee, has a plan to mitigate the Valley of Death.
“The U.S. government has been a lousy partner, quite frankly,” he said. “We get companies and we waste their time … and then we’re wondering why we’re not getting the technologies we want.”
Calvert wants to create a new “innovation fund” through the appropriations process.
“Start out, say, with about $100 million, and then we can pick a number of people that we want to succeed and get them through that Valley of Death where they can actually get to procurement,” he explained.
“I’m going to work with my friends on both sides of the aisle and the Senate” to set up the fund, he added. “I’m hoping that we can do that as soon as possible.”
Topics: Defense Department
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Jon,

With particular regard to the “Valley of Death syndrome” which so many companies/entities may indeed encounter and suffer from, one also needs to be aware of its not dissimilar parallel affliction which has the likes of a Pentagon buyer severely comprehensively disadvantaged and liable to lose all possible leading advantage, both present and future, to a similar foreign based competitor and/or a more effective and efficient alien opposition should they be more proactive and more promiscuously forward in initiating vital primary engagement with that which they, Pentagon types and their ilk, have next to zero practical or virtual knowledge of but realise is of great significant importance to them ……. for its novel stealthy/shadowy/out of the blue suppliers persist to consistently and constantly maintain renders to one, and any suitable wannabe Caesar or Calpurnia, an absolutely almighty AWEsome advantage …. aka Pioneering Lead.

The following earlier post shared elsewhere [Tue 25 Jan 15:48 GMT/The Register] explains and expounds further on the dilemma, which surely is basically universal and thus may afford some cold comfort and give one some encouragement that all may not be yet totally lost. …….

“Blissful Ignorance is No Viable Noble Base for ProACTive Novel Progress.

As long as the UKCSC, MIC* and .gov wonks stay well clear of any notion that would have them thinking to bar competent security specialists from working with any universal entity of the specialists’ choosing, they should be quite safe and secure from any resultant unpleasantness much worse than anything akin to a right royal old Etonian boys mess.

And one prime way of avoiding such a conflict is not to be so backward in coming forward to positively engage with that and/or those they may quite rightly be quite wrongly concerned about. Such does though require some of those phantom official gatekeepers to practise more competently some of their quantum leaping skills, should they have any, for they aint going anywhere special and beneficial to them without falling off/jumping over that particular fence and into right proper virgin fields of investigation and exploration/exploitation and monetisation/powerful command and almighty control.

* … Military Industrial Complexes
UKCSC ….. United Kingdom Cyber Security Council”

…….. and further on one is advised to be prepared for many new things, for such is the current nature of present running rapid future progress ….

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“Forewarned is forearmed …. and the smartest freely available option is to take good heed.

There be new kids on the block who aint skiddies or anything like any other hoods in the environment. And they’re flying high, far and wide and real deep down into the nitty gritty of what everything is about. Don’t misunderestimate either them or overestimate anyone else’s ability to mitigate their facility and utility. Such would be a fabulous folly all would just love to regret and forget.”

And now that you know about all of that, and everything there can be freely shared, can no one searching for such information say it was kept secret and they be completely surprised at the strange directions that may or may not be taken by certain key future events because of the freely shared intel available.
Maybe if one of the requirements was to bribe your local representatives instead of developing products they will get some contracts!

Sadly thats partially true – another thing is that the GOV is completely backwards about software and seems unable to modernize to due to bureaucratic gridlock across the board.
I think the Valley of death has a name, “Requirement Document”
2101 Wilson Blvd, Suite 700
Arlington, VA 22201
tel: (703) 522-1820

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Biden begs for money for 2024 Campaign from local SF Bay Area tech leaders and talks AI

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Biden discusses risks and promises of artificial intelligence with tech leaders in San Francisco

SAN FRANCISCO (AP) — President Joe Biden convened a group of technology leaders on Tuesday to debate what he called the “risks and enormous promises” of artificial intelligence.

The Biden administration is seeking to figure out how to regulate the emergent field of AI, looking for ways to nurture its potential for economic growth and national security and protect against its potential dangers.

“We’ll see more technological change in the next 10 years that we saw in the last 50 years,” Biden said as the meeting with eight technology experts from academia and advocacy groups kicked off.

“AI is already driving that change,” Biden said.

The sudden emergence of AI chatbot ChatGPT and other tools has jumpstarted investment in the sector. AI tools are able to craft human-like text, music, images and computer code. This form of automation could increase the productivity of workers, but experts warn of numerous risks.

The technology could be used to replace workers, causing layoffs. It’s already being deployed in false images and videos, becoming a vehicle of disinformation that could undermine democratic elections. Governments, as well as the European Union, have said they are determined to regulate and put brakes on AI before it is too late.

Biden said social media has already shown the harm technology can do “without the right safeguards in place.”

In May, Biden’s administration brought together tech CEOs at the White House to discuss these issues, with the Democratic president telling them, “What you’re doing has enormous potential and enormous danger.”

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White House chief of staff Jeff Zients’ office is developing a set of actions the federal government can take over the coming weeks regarding AI, according to the White House. Top officials are meeting two to three times each week on this issue, in addition to the daily work of federal agencies. The administration wants commitments from private companies to address the possible risks from AI.

Biden met Tuesday at the Fairmont hotel in San Francisco with Tristan Harris, executive director of the Center for Human Technology; Jim Steyer, the CEO of Common Sense Media; and Joy Buolamwin, founder of the Algorithmic Justice League, among others. California Gov. Gavin Newsom was also in attendance.

Biden is also in the San Francisco area to raise money for this 2024 reelection campaign. At his first fundraiser of the night, Biden spoke about what he saw as freedoms under siege, particularly for the LGBTQ community and with the overturning of abortion protections by the U.S. Supreme Court. And as president, it’s his job to help safeguard the right to choose.

“I think the American people need to have the confidence that we’re going to do what we say we’re going to do,” he said.

Climate change has also been a priority in Biden’s speeches at the fundraisers. On Tuesday, he told a group that he expects that John Kerry, the special envoy for climate, will soon return to China for talks on reducing carbon emissions.

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Associated Press writer Barbara Ortutay in San Francisco contributed to this report.

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Microsoft makes case for Activision merger amid EU scrutiny

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Microsoft makes case for Activision merger amid EU scrutiny

BRUSSELS (AP) — Microsoft’s Xbox video game division on Tuesday announced new partnerships with Nintendo and chipmaker Nvidia as it tries to persuade European regulators to approve its planned $68.7 billion takeover of game publishing giant Activision Blizzard.

A key audience for the announcements were the European Union antitrust regulators who held a closed-door meeting Tuesday with executives from Microsoft and some of its competitors, including Sony and Google.

Microsoft announced a 10-year agreement with chipmaker Nvidia to bring Xbox games to Nvidia’s cloud gaming service. Microsoft also said it has now signed a similar deal with Nintendo, formalizing a commitment it revealed late last year.

What it does not have is an agreement with Xbox’s chief rival, PlayStation-maker Sony, which has sought to convince antitrust regulators around the world to stop the Activision Blizzard merger.

The all-cash deal, which is set to be the largest in the history of the tech industry, faces pushback from regulators in the U.S. and Europe because it would give Microsoft control of popular game franchises such as Call of Duty, World of Warcraft and Candy Crush.

The European Commission, the 27-nation bloc’s executive arm, has been investigating whether the merger would distort fair competition to popular Activision Blizzard game titles. It’s scheduled to make a decision by March 23.

Microsoft first announced the agreement to buy the California-based game publisher early last year, but the takeover has also been stalled in the U.S., where the Federal Trade Commission has sued to block the deal, and in Britain, where an antitrust watchdog’s provisional report said it will stifle competition and hurt gamers.

Microsoft, which is based in Redmond, Washington, has been counting on getting approval in either the EU or Britain to help advance its case in the U.S.

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Microsoft’s president, Brad Smith, said at a Brussels news conference after meeting with regulators Tuesday that he was “not in a position to say exactly what was said in the hearing room” but emphasized that Xbox has a much smaller share of the market than PlayStation does in Europe, and asserted that the deal would be good for the industry by bringing more games to more people.

“For us at Microsoft, this has never been about spending $69 billion so that we could acquire titles like Call of Duty and make them less available to people,” Smith said. “That’s actually not a great way to turn a $69 billion asset into something that will become more valuable over time.”

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Amid ChatGPT outcry, some teachers are inviting AI to class

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Amid ChatGPT outcry, some teachers are inviting AI to class

LEXINGTON, Ky. (AP) — Under the fluorescent lights of a fifth grade classroom in Lexington, Kentucky, Donnie Piercey instructed his 23 students to try and outwit the “robot” that was churning out writing assignments.

The robot was the new artificial intelligence tool ChatGPT, which can generate everything from essays and haikus to term papers within seconds. The technology has panicked teachers and prompted school districts to block access to the site. But Piercey has taken another approach by embracing it as a teaching tool, saying his job is to prepare students for a world where knowledge of AI will be required.

“This is the future,” said Piercey, who describes ChatGPT as just the latest technology in his 17 years of teaching that prompted concerns about the potential for cheating. The calculator, spellcheck, Google, Wikipedia, YouTube. Now all his students have Chromebooks on their desks. “As educators, we haven’t figured out the best way to use artificial intelligence yet. But it’s coming, whether we want it to or not.”

One exercise in his class pitted students against the machine in a lively, interactive writing game. Piercey asked students to “Find the Bot:” Each student summarized a text about boxing champion and Kentucky icon Muhammad Ali, then tried to figure out which was written by the chatbot.

At the elementary school level, Piercey is less worried about cheating and plagiarism than high school teachers. His district has blocked students from ChatGPT while allowing teacher access. Many educators around the country say districts need time to evaluate and figure out the chatbot but also acknowledge the futility of a ban that today’s tech-savvy students can work around.

“To be perfectly honest, do I wish it could be uninvented? Yes. But it happened,” said Steve Darlow, the technology trainer at Florida’s Santa Rosa County District Schools, which has blocked the application on school-issued devices and networks.

He sees the advent of AI platforms as both “revolutionary and disruptive” to education. He envisions teachers asking ChatGPT to make “amazing lesson plans for a substitute” or even for help grading papers. “I know it’s lofty talk, but this is a real game changer. You are going to have an advantage in life and business and education from using it.”

ChatGPT quickly became a global phenomenon after its November launch, and rival companies including Google are racing to release their own versions of AI-powered chatbots.

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The topic of AI platforms and how schools should respond drew hundreds of educators to conference rooms at the Future of Education Technology Conference in New Orleans last month, where Texas math teacher Heather Brantley gave an enthusiastic talk on the “Magic of Writing with AI for all Subjects.”

Brantley said she was amazed at ChatGPT’s ability to make her sixth grade math lessons more creative and applicable to everyday life.

“I’m using ChatGPT to enhance all my lessons,” she said in an interview. The platform is blocked for students but open to teachers at her school, White Oak Intermediate. “Take any lesson you’re doing and say, ‘Give me a real-world example,’ and you’ll get examples from today — not 20 years ago when the textbooks we’re using were written.”

For a lesson about slope, the chatbot suggested students build ramps out of cardboard and other items found in a classroom, then measure the slope. For teaching about surface area, the chatbot noted that sixth graders would see how the concept applies to real life when wrapping gifts or building a cardboard box, said Brantley.

She is urging districts to train staff to use the AI platform to stimulate student creativity and problem solving skills. “We have an opportunity to guide our students with the next big thing that will be part of their entire lives. Let’s not block it and shut them out.”

Students in Piercey’s class said the novelty of working with a chatbot makes learning fun.

After a few rounds of “Find the Bot,” Piercey asked his class what skills it helped them hone. Hands shot up. “How to properly summarize and correctly capitalize words and use commas,” said one student. A lively discussion ensued on the importance of developing a writing voice and how some of the chatbot’s sentences lacked flair or sounded stilted.

Trevor James Medley, 11, felt that sentences written by students “have a little more feeling. More backbone. More flavor.”

Next, the class turned to playwriting, or as the worksheet handed out by Piercey called it: “Pl-ai Writing.” The students broke into groups and wrote down (using pencils and paper) the characters of a short play with three scenes to unfold in a plot that included a problem that needs to get solved.

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Piercey fed details from worksheets into the ChatGPT site, along with instructions to set the scenes inside a fifth grade classroom and to add a surprise ending. Line by line, it generated fully formed scripts, which the students edited, briefly rehearsed and then performed.

One was about a class computer that escapes, with students going on a hunt to find it. The play’s creators giggled over unexpected plot twists that the chatbot introduced, including sending the students on a time travel adventure.

“First of all, I was impressed,” said Olivia Laksi, 10, one of the protagonists. She liked how the chatbot came up with creative ideas. But she also liked how Piercey urged them to revise any phrases or stage directions they didn’t like. “It’s helpful in the sense that it gives you a starting point. It’s a good idea generator.”

She and classmate Katherine McCormick, 10, said they can see the pros and cons of working with chatbots. They can help students navigate writer’s block and help those who have trouble articulating their thoughts on paper. And there is no limit to the creativity it can add to classwork.

The fifth graders seemed unaware of the hype or controversy surrounding ChatGPT. For these children, who will grow up as the world’s first native AI users, their approach is simple: Use it for suggestions, but do your own work.

“You shouldn’t take advantage of it,” McCormick says. “You’re not learning anything if you type in what you want, and then it gives you the answer.”

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Associated Press writer Sharon Lurye contributed to this report from New Orleans.

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The Associated Press education team receives support from the Carnegie Corporation of New York. The AP is solely responsible for all content.

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