The beginning of the new millennium has opened the way for dramatic societal changes the world over. New social phenomena have appeared due to the generalised hyper-connection of individuals, objects, entities and organisations.

Three main aspects deserve a detailed analysis to better understand how European Defence Industry has been and will be impacted in the near future.

Firstly, the Internet of Things (IoT). Internet protocols were invented in the defence world with the DARPANet, the US Defence Advanced Research Projects Agency Network, to ensure communication networks’ survivability during the Cold War. Developments of the internet protocols recently led to the IoT, which allows this socially-accepted or socially-induced hyper- connection, where millions of objects, be it cars, houses, robots or else, have the capacity to sense, process, report and react. In other words, IoT is edge processing, able to close the detect- process-react cycle. The introduction of 5G and other advanced communication protocols will further enhance the inter-machines communication and edge processing, that signals the dawn of a new era, in which people assume that they are continously connected to one another. In reality the connection occurs between machines: Luciano Floridi, Professor of Philosophy and Ethics of Information at University of Oxford, states that “humans are just a tiny part of the communication on this planet”. In the case of unmanned systems, for example, systems can communicate with each other independently of human intervention, and already do. This brings about new challenges of cyber-defence and cybersecurity.

This is a clear paradigm shift that will move human communication towards a machine-governance layer that needs specific attention, in particular in the defence sector.
Secondly, a direct consequence of the massive digitalisation of the economy and society is the fourth industrial revolution, also known as Industry 4.0 (subject of a previous newsletter). This digital transformation was accelerated by new technologies, such as autonomous systems, sensors, analytics, 3D printing, etc. The defence industry must quickly adapt to this new scenario because of the exponential obsolescence rate of previous technologies. This accelerated obsolescence is a deviation from the traditional defence industry’s approach towards security of supply: building up stocks of spare parts was based on the assumption that the same technology would stay in use for at least 30 years. In addition, the introduction of the EU’s REACH regulation and the flourishing of the circular economy put new constraints on this traditional approach. The circular economy and its related manufacturing processes could also address the issue of critical raw materials and their limited supply. A new vision is therefore needed for the technological solutions offered by the defence industry.

A third aspect related to the hyper-connection phenomenon is the transformation of the battlefield concept. As mentioned in a previous opinion in this newsletter, a fourth generation of warfare has appeared in the last two decades. This phenomenon of the digitized battlefield has been referred to as the “New Westphalia” concept, which puts into question the nation-state paradigm, its structure and its rigidity. War is no longer limited to a confined perimeter, but has spilled over, among others into civil society. The concept of hybrid threats was developed in this context. This was made possible through hyper-connection, the growth of non-state agents, the communications revolution and the omnipresence of networks.

These three aspects generate a dramatic demand for disruptive innovation in the defence sector, which requires an extremely dynamic, highly risk-oriented and adaptive-to-change development process. In addition, digital giants like Google, Amazon, Microsoft, spend more than USD 50 billion per year on digital innovation, a sum that can be hardly matched by European governments. In 1987, the US DoD accounted for about 40% of all R&D spending, but by 2013 that share had dropped to below 20%. In Europe, the phenomenon is even more evident. It is therefore natural to think that the development of future defence technologies must involve private sector investment, exploiting dual use elements and the digitalisation revolution.

Two principal elements will influence the future of European Defence Industry: firstly, there is a need to create a solid and credible critical mass among European Member States, with the view to reach adequate defence budget levels to cope with new challenges. This can be achieved through stronger, more connected and more interoperable European forces. Recent developments in European defence policy, such as the Permanent Structured Cooperation (PESCO), are a clear sign of movement in the right direction. The European Defence Agency (EDA) is on the front line of these developments: it is directly involved in PESCO, in the Coordinated Annual Review on Defence (CARD) and in the Preparatory Action for Defence Research (the first step towards a wider European Defence Research Programme).

Secondly, the incremental approach prevalent today in most European armed forces should be replaced by a more disruptive approach. Larger innovation spillovers are expected not only in the armed forces, but also in other sectors, taking into account the strong entanglement2 between the defence and civil sector. In fact, more than 90% of the technologies developed in defence have a civilian counterpart. The EDA’s programmes aim to support these disruptive developments in defence technology. Project MEDUSA (“Multi sensor data fusion grid for urban Situational Awareness”), for instance, took a standard civil IoT architecture to connect and fuse the data from different sensors like UAS (Unmanned Aerial Systems), UGVs (Unmanned Ground Vehicles) or soldier sensor nodes. The EDA’s project on “Graphene in defence” will develop a roadmap for graphene applications in defence while project EuroSWARM (“Unmanned heterogeneous swarm of sensor platforms”) looks at the development of technologies for adaptive, informative and reconfigurable operations of unmanned heterogeneous swarm systems.

We are at the dawn of a new era of warfare, demanding a disruptive technological approach by the European Defence Industry, which can be facilitated by an ambitious European Defence Policy.
The European Defence Agency, following the Long Term Review, acts as “preferred cooperation forum and management support structure to engage in concrete technology and capability development activities” and will help the Member States and their defence industry to make disruptive innovation a reality in Europe.