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Silicon Soldiers of Fortune

The valley's chunk of the military budget promises to drive weapons procurement to technological heights

By Chris Weir

IT'S UNCLEAR exactly what role special access programs play in Santa Clara Valley's defense economy. Given the history of this economy and its emphasis on satellite technologies (strategic and intelligence satellite production is one of the black budget's most expensive preoccupations), the role is probably significant. According to company spokesperson Katherine Strehl, Sunnyvale's Lockheed Martin Missile & Space--the largest division in the Lockheed Martin family--employs more than 10,000 people and does $4.6 billion in sales (defense, civil and commercial). Lockheed Martin Missile & Space, TRW and other defense contractors frequently subcontract work to local computer firms. "The defense aerospace industry in Silicon Valley is what we would refer to as the traditional industry cluster," says Tim Quigley, president and CEO of Silicon Valley Defense/Space Consortium, a nonprofit regional business partnering organization. "It predates the chip industry, because defense aerospace really started growing significantly with Lockheed Martin moving here in 1953. It grew to about $5.6 billion in contracts in the heyday of the Reagan era, and it shrank to just under $3 billion around 1991. And then it crept back up to $3.5 billion, and it's stabilizing in that area."

While special access money could be included in those figures, it's also possible that some money has eluded the tally. Simply put, the economics of the black budget defy strict accounting.

Meanwhile, according to Quigley, local firms are setting a technological pace that could refine both standard and special access procurement. "Technology is hitting the commercial counter faster than it used to," he says. Whereas the research, development and procurement of a particular advanced technology may have taken six or more years in the past, Quigley says, a similar achievement might now take only seven to 18 months from idea to market. Consequently, the marketplace is increasingly outpacing the traditional procurement process.

As one of the frequent criticisms of special access programs is that their security perimeters have often been wider--and thus more expensive--than could be adequately justified on national security grounds, the faster technological pace could have an evolutionary and salutary impact on black world methodology. "Traditionally, it [a secret project] is deep black, then it goes black, then it becomes light gray, then it works through the gray, and one day we declare it white," says Quigley. "Now we're going to have to deal with the fact that some of the pieces that you might need are white to begin with. The form of how we handle classified programs will have to change."

While this certainly doesn't spell the end of special access, it could effect a natural streamlining process. Says Quigley, "Those in the business have long wanted it [procurement] to be improved upon, and this is the user-friendly way for that to happen. It will just be driven in that direction."

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From the January 9-15, 1997 issue of Metro

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