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The technical and tactical lessons learned during the 78-day air war against Yugoslavia this year will drive new business opportunities throughout the defense information technology market, according to a recent industry forecast.
Although Defense Department spending on IT is expected to increase by $1.5 billion over the next five years, officials from the Government Electronics and Information Technology Association (GEIA) point to the Pentagon's experience in Kosovo and the burgeoning security market as two primary drivers of future IT spending in the military services.
Meanwhile, a recent General Accounting Office report concluded that the earlier-than-expected end to combat operations in Yugoslavia caused cost projections for the campaign to decline substantially, making additional funds available for other DOD requirements.
"We estimate that there could be between $138 million and $475 million remaining at the end of fiscal year 1999 that could be used to reduce fiscal year 2000 funding requirements for contingency operations, which are expected to exceed $5 billion," GAO stated in the report.
Congress appropriated $300 million to a new appropriations account known as the Operational Rapid Response Transfer Fund, which DOD plans to use to replace and upgrade equipment used in Kosovo, the GAO report stated. In fact, $40 million is earmarked to replace equipment destroyed during operations, particularly DOD's unmanned aerial vehicles, and the remainder appears to be intended for enhancements to existing equipment.
However, according to GAO, Congress appropriated the funds to beef up deficiencies in several "high-leverage" areas, including electronic warfare and surveillance, tactical imagery and signals intelligence, and related communications and data links designed to rapidly disseminate information.
Speaking last month at GEIA's 1999 Vision Conference on the fiscal 2000 Defense budget forecast, Mary Freeman, a GEIA IT committee member, called Kosovo "a wake-up call" and said that many of the lessons learned being compiled in the initial classified version of the after-action report relate to information warfare.
J.J. Davis, who provided GEIA's top-line Defense electronics forecast, said that, based on the lessons learned during NATO's Operation Allied Force, command, control, communications, computers and intelligence interoperability "is currently the weakest link in coalition warfare."
Kosovo's poor weather highlighted shortfalls in surveillance and reconnaissance, he said. Although Kosovo highlighted the importance of precision, satellite-guided weapons, "it took 38,000 sorties to get [Slobodan] Milosevic to concede, [and] the Serb Army left with most of their tanks, artillery and integrated air defenses intact," Davis said.
"Opportunities abound" in NATO interoperability, said Mike Kush, chairman of GEIA's Defense Forecast Team. "It's a must-solve problem, and there are dollars available." Although Kosovo demonstrated a need for enhanced intelligence and reconnaissance, "the intelligence community has said they will spend first on readiness, not new IT," Kush said. "The dollars just aren't there that were there during the Cold War."
Davis said the Army may be the service most affected by the lessons learned during Kosovo, adding that the service again learned the lesson that it needs to be more mobile -- a capability the Army is experimenting with as part of its digitization effort. "The role of the Army is changing from being offensive to being defensive," Davis said.
The Army's IT budget will continue to see "rapid growth" over the next five years, with modernization accounting for more than one-third of its IT budget, Freeman said. GEIA estimates put Army IT spending at $3.1 billion or about 4.6 percent of its overall spending during fiscal 2000.
The Navy and Marine Corps "did what they were supposed to do" during Kosovo, which will have limited impact on future Navy operations and planning, Davis said. However, one lesson derived from the air campaign was the need to address the "unexpected high demand for EA-6B" electronic warfare aircraft, which the Navy and Marines operate on behalf of all the services. Beyond aircraft and ships, "you don't see a lot of money" in the Navy budget, Davis said.
Although the Navy's request for $396 million in command and control funding is up more than 1 percent from last year's funding, the Navy's overall IT budget growth will be about 1 percent less than that of the Army and the Air Force, Freeman said.
The key initiative for the Navy and Marine Corps will be the Navy/Marine Corps Intranet program, officials said. In fact, military and industry sources say the projected $2 billion program is "probably much larger," but because of the drain on IT budgets from operations and maintenance accounts, the N/MCI likely will not lead to an overall increase in the budget, Freeman said.
The Air Force is expected to see a 2 percent growth rate in IT spending, Freeman said, with IT accounting for about 4 percent of its $77.7 billion fiscal 2000 budget.