POLITICO Professional Q&A: Michael Brown, director of the Protection Innovation Unit

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Brown, a former CEO of cybersecurity agency Symantec who got here to DIU in 2018, says that the unit, which additionally has places of work in Boston, Austin and D.C., is steadily making strides to make sure the army is well-positioned within the business sector’s innovation ecosystem.

However there are additionally few indicators the Chinese language have given up their aggressive efforts to put money into American start-ups.

“China has been able to continue at their previous rate,” Brown mentioned. “The level of Chinese investment in technology has not gone down one bit since we wrote the original report.”

Brown spoke to POLITICO Professional about how DIU is scaling up, the rising willingness of once-wary tech corporations to companion with the Protection Division, and why he sees the competitors with China as more and more a tech marathon and never an arms race just like the Chilly Battle.

This transcript has been edited for size and readability.

What’s most totally different about DIU now?

A whole lot of the efforts which have been underway are about scaling DIU. We have now our personal contracting functionality, a giant deal for us. Then we have put within the further construction of getting a devoted protection engagement staff that is at all times scanning for an important issues. After which there may be the business engagement staff scanning the innovation ecosystems the place we reside. This devoted staff’s job is to know the place the attention-grabbing options are being efficiently deployed commercially. For instance, in AI, “Who’s got the best technology that can detect anomalies in big data, or who’s got the best technology to do sensor fusion?”

So I believe the construction we have now of devoted groups doing contracting, protection engagement, business engagement allowed us to attain the subsequent degree of impression for a rising variety of tasks.

Are extra firms participating with DIU?

We have now began our one hundred and fifth undertaking. So we have now much more tasks underway now than we did two years in the past.

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Responses from firms are up 35 p.c from 2019. Much more persons are discovering out about us. Some firms have been profitable and now they’re returning for an additional alternative to work with DoD.

So there may be much less political resistance within the Valley to working with the Protection Division?

I believe we have been on an upward slope for a while now. So we’re seeing an growing variety of firms that wish to work with us. A few of that’s as a result of we work in areas the place firms and their staff have acknowledged from day one they will be working with the federal government equivalent to in autonomous techniques or business house.

Even in AI and cyber, if they’re smaller firms, versus a Google or Microsoft, their major concern is how they develop their firm or how they make payroll. Or how do they get to the subsequent funding milestone? They are much extra involved about what DIU can do to assist them get entry to DoD contracts than they’re about making an attempt to make a political assertion

I believe it is actually solely the big multinationals — so Google, Microsoft, Amazon — that face that type of query. And all the administration of these firms, together with Google, have mentioned publicly now they will help working with the Protection Division. We’re working with Google on various tasks now. So I do not see a lot resistance. In fact, there is a cultural distinction between D.C. and Silicon Valley, however I do not suppose that’s what will get in the way in which of getting us do much more with small firms. It’s extra of an financial choice, whether or not DoD is ready to go quick sufficient and whether or not the corporate will have the ability to land a high-volume contract.

Are there bureaucratic impediments to working with extra gamers?

Whereas I am very pleased with what we have completed at DIU, we’re not frictionless in comparison with their different prospects. There are nonetheless issues that make it slightly harder working for DoD than different business prospects they may work with. So we’re persevering with to attempt to break much more limitations down in order that extra firms will think about us. That is working within the mixture, however we’re not going to be comfortable till each firm would have a look at what we’re doing and say, “yeah, I’d like to be working with DIU.”

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And that’s translating into merchandise within the discipline?

We had a file of 11 capabilities transferred final yr to the army. Meaning each a manufacturing contract for the seller, plus functionality scaled to the warfighter. We by no means think about a undertaking profitable if it is only a contract accomplished and no capabilities deployed. We actually require each of these for a undertaking to achieve success.

You sounded the alarm about Chinese language enterprise capital. Have latest reforms to the Committee on Overseas Funding in the USA made an impression?

I believe I’ve the identical degree of concern as many within the nationwide safety enviornment. So in fact I used to be enthused to see that the Overseas Funding Threat Overview Modernization Act and the Export Management Reform Act have been handed in 2018. However sadly, it is taken a while for the brand new guidelines to be put in place by each Commerce and the Treasury. Within the meantime, China has been capable of proceed investing at its earlier charge. The extent of Chinese language funding within the know-how house has not gone down since we wrote the unique report in 2017.

CFIUS in fact was very conscious of the truth that extra Chinese language firms have been making an attempt to purchase U.S. property, particularly in fields like semiconductors. CFIUS already had the jurisdiction to cease straight acquisitions. What CFIUS wanted was the framework to raised assess mental property switch due to giant enterprise investments, know-how licensing offers, or joint ventures. I believe we have now the fitting legal guidelines in place. We have got to ensure that our regulatory system now catches up by way of our guidelines and course of. However then I count on the Chinese language are going to determine, “now that that door is blocked, what’s the subsequent open door I can undergo.”

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So you actually are on the entrance strains of the tech race with Beijing?

The president has referred to as it strategic competitors with China. I believe he is proper. I differentiate that from the Chilly Battle arms race. It truly is a tech competitors as a result of China sees the worth of reworking their financial system via excessive know-how to get increased paying jobs, to develop their financial system, to be the supply of know-how for world markets and to set requirements. So within the tech race, it should be way more vital for the U.S. to put money into our personal strengths. What we actually must concentrate on is investing for the know-how breakthroughs for the subsequent 20, 30 or 40 years. This requires a rise in federally-funded analysis, enhancing our [science, technology, engineering and mathematics] schooling and rising our expertise, and inspiring the personal sector to take a position for the long run.

What moonshots are we creating in the present day? I believe it is that dedication to being preeminent in science and know-how — ensuring we have the fitting coverage framework so we’re encouraging loads of innovation in these areas — that may preserve us on the forefront of what I will name the game-changing applied sciences: AI, biotech, autonomous techniques, quantum science, cyber. In some areas, China’s already forward, like 5G, and small drones. We do not need these conditions to grow to be the norm despite the fact that that is China’s recreation plan.