The AUKUS EFFECT: HOW THE PARTNERSHIP WILL SPUR INNOVATION

January 23, 2024

By Mike Dodd, USMC (Ret.)

There are few places where the proverb, “necessity is the mother of invention” rings true more than in the military. In the Marine Corps, we were constantly “building better mouse traps” many times aiming to increase lethality by creating standoff distance from the enemy. Of course, todays’ Department of Defense (DoD) is doing much more than just making mouse trap improvements. DoD is leveraging technology like never before to outpace our adversaries by working with prime contractors and non-traditionals to devise and build all kinds of game-changing hardware and software including trusted and assured microelectronics, AI and attritable autonomous systems at scale, just to name a few. The goal is always to deter major conflict, or, if forced to fight, have a decisive technological advantage.  

One of the best current opportunities to invent and innovate was created by an existential need: to ensure that the Indo-Pacific remains a region free from coercion and ward off potential aggression posed by the People’s Liberation Army (PLA), the armed wing of the Chinese Communist Party (CCP), the ruling, and only, political party in China.  

The Australia United Kingdom United States (AUKUS) trilateral partnership, was established to bolster military might in the Indo-Pacific. The partnership has two main tactics, or Pilars. Pilar I, arming the Australian Navy with additional nuclear-powered Virginia-class submarines. Pilar II producing cutting-edge technology and lots of it. Think closed networks of sensors and autonomous intel-gathering and weapons systems that can operate in concert in a GPS-denied environment.  

 “Again and again, AUKUS proves that we are stronger together, and every day, we move closer to our shared vision of a free and open Indo-Pacific,” Secretary of Defense Lloyd Austin said late last year after meeting with his Australian counterpart.  

Importantly, that meeting didn’t take place at the Pentagon or anywhere in Washington, D.C. Instead, the leaders gathered in Mountain View, California, in the heart of Silicon Valley, at the headquarters of the Defense Innovation Unit (DIU). DIU, which focuses on fielding and scaling commercial technology across the U.S. military at commercial speeds, is leading the adoption of AUKUS-related technologies. The Unit, which now reports directly to the Secretary of Defense, has a proposed budget of more than a billion dollars and is headed by former Apple executive and current Navy reservist, Doug Beck, will host a prize challenge in the near future, with the ability to fund technologies from all three allied nations. This is a prime example of DoD putting money where its mouth is. For years there’s been talk of innovation—with many successes—but now a DoD-wide unit, whose budget may increase 10x over last year, now reports directly to the top and has an innovator leading it. DIU is positioned like never before to make a huge impact.  

Another important component in the AUKUS equation is private capital. While government has created a demand signal, the private sector will create the true innovation engine that will push concepts into production quickly. To that end, investors are looking at defense as a sure bet. A recent New York Times article pointed out that some 50 top former Pentagon officials are working at venture capital firms making connections between funding and in-demand defense technologies. While the Times painted the story with a negative brush, the opposite is true; we absolutely need private capital to invest in the most disruptive technologies and we need former insiders who have the knowledge and contacts to make that happen. As former Secretary of Defense Mark Esper, now a partner at venture capital firm Red Cell, put it, “I can really leverage my experience, my positions, my voice to help accelerate innovation adoption.”  

Hundreds of investors in all three AUKUS nations are coming together to pool resources that will simultaneously bolster national security and offer a solid return on investment.  

Conflict is a last resort. The recent elections in Taiwan, in which the Democratic Progressive Party (DPP) secured a historic third consecutive term, indicate that status quo—a free and independent Taiwan-- is the wish of the Taiwanese people, as it is of the United States and our allies. However, as is always the case, we must be prepared if our adversaries choose conflict over peace and, as always, we must never (ever) fight a fair fight.