>> this week on "defense news." a look at cyber security, global competition for weapon sales, and why reform is so crucial to the pentagon. welcome to defense news. here's a look at a couple of this week's headlines. they are increasingly at odds on security priorities. the syrian and kurdish peoples protection unit. long asked the u.s. to choose sides. they have put a brave

face on news that will be blacklisted in india calling it is miss in the country very marginal. minister saide the group will be blacklisted in the wake of allegations and offered bribes to a helicopter contract in 2010. a former mechanic was given a 4.5 year sentence last month by an italian appeals court. and now my interview with matthew schwartz, executive director of the navy fleet cyber command that wrapped up his tenure with the services task force cyber awakening. i set down with them recently hear more. >> it started off with a simple e-mail. it asked this question. if anybody could characterize all of our technical platforms. we realized we were unable to. they could characterize

for i.t. and traditional cyber areas pretty well. when we started to look across all of our enterprise, we were unable to understand the risk. that presented a risk to our capabilities, we wanted to make sure we were working together to solve that problem and we needed to look at this through an enterprise perspective. the first goal was to identify what we needed to do immediately. saw and the threats we our vulnerabilities, identify what we needed to fix today. we evaluated almost 800 items valued in excess of several hundreds of millions of dollars. and we applied the prioritization method. we worked with our other partners

make sure we get execute those quickly and rapidly. is an extension of the program. but what was looking at is we need to protect things at all costs. what were the most important things we needed to protect and develop a methodology. to make sure that they were protected. making sure we can operate that.

we have the construct in place. should it be an organizing principle for the navy, a new war fighting domain, do we need to look at it differently? the answer to that question became yes. we determined that we probably did need to look at cyber security. we needed to organize around this problem. and that we had individual systems and programs. we also realized we had a lot of great talent and expertise. to bring the best minds we had together to work and solve this problem together. and bring the chief engineers across this together

concerns, we are developing standards, and across all of our capabilities. >> it has been eight months since that wrapped up. you are in a more operational role. have you taken what you've learned and started to roll out any sort of initiatives? >> it has been an interesting journey. i found myself looking at this from a strategic lens and trying to be the mechanism that brought together a lot of expertise strategically, organizationally, culturally. mechanisms inhose place, we learned what we needed to do to identify what we had to do at all costs.

making sure that the capabilities that the task force identified, those things are transitioning to us and we have operational effectiveness. cohesion where we have the acquisition folks talking to each other. we find those are not unique to specific programs. that they are common. we work as an enterprise to develop solutions together and we are able to take those solutions and deploy them as opposed to trying to solve every problem. we start to see the fruits of that labor and great progress in this space. >> you just did a keyno

of cyber security. >> in this journey, i realized cyber security is not an .ngineering challenge although there are difficulties and solutions we have to develop , but we realized there was an organizational and cultural issue that we needed to come together as an enterprise. technology is the terrain in which we operate. the human element is important. the human element is still part of that every day. the analyst look at that information and make recommendations or decisions on what to do against specific events. technology is the terrain. people are the capabilities.

are trained and proficient. >> you are watching "defense news." >> today's programming is brought to you by -- me and the guys walked into this you woulda thought from the name it was gonna be packed with sailors. so i immediately picked out the biggest guy in there. and i walked straight up to him. now he looks me square in the eye, and, i swear he says, "welcome to navy federal credit union." whoa friendly alert! i got a great auto rate outta that guy.

now i have a wonderful hybrid. slate blue. crème interior. he was so nice! open to the armed forces, the dod and their families. navy federal credit union.

>> welcome to defense news. we recently sat down to talk about linking soldiers in a tactical network and the most harsh environments. >> there is a series of programs that if you look at the tactical edge, we break it into three parts. the upper tier which is really --gade to the italian, then battalion. then there is below. being able to send position and location, where are you on the grid.

and connecting it by waveform. >> where working within the traditional process to get a validated requirement and the army is not rating -- waiting. they signed up a bunch of operational statements.

the financial world, the utility world, they are all very focused on cyber affects. it allows us to bring in the best money. the company just joined the consortium. the first is, by increasing the size of the de

different approaches. the way we think it should be done and the way they think it should be done might be completely different. opportunity to show us what they have. is it allows us to look at different companies and different suggestions that you two need to talk. the end state is to be able to buy prototypes. it allows us to take those to the cyber force and have them utilized and come back and tell us. it gets us further in development significantly quicker using products we may not have ever known about

play? i know undersecretary carter, it's that being integrated into what you are doing it all -- is that involved in the process? >> it's a great question. the answer is yes. the innovation unit experimental. we have done a cyber challenge folksg it to bring the the micro cloud management

stay collected. it is a partnership. >> when we return, we ask about

>> capitol hill reporter joe gold recently spoke with the center for new american security and the center for strategic and international studies to discuss proposals on the hill to reform the pentagon's activation system. >> it is very active and they are both very focused on the diminution of the technical

technological advancement compared to others. it is not about a specific threat as a loss of advantage. the slightly different ways are not mutually exclusive. are thene for us what fixes from either side? >> there are three really big issues in these bills. the first is the changing of the focus of the office within the lesstment of defense to be about the execution and acquisition program and more about the fundamental technologies and getting innovation into the system. the second big issue is the question of how programs should be structured. taking most of the technology development out

environment and putting it into a prototype and tech development environment and saving big programs for technology that is completely mature. the third thing is a business riskionship and how the should be shared. >> there is someone in that job right now. of thethe recasting position a reflection on them? >> the senate has emphasized it is not personal. it is about the purpose and about the focus. department has expressed concern and opposition on a couple of counts. they are concerned that these changes could take the focus off the kind of measures to stop cost growth.

office will not have the span of control across the entire lifecycle of programs they think it needs. hinting atyou were the cost plus versus contracting. what are those? shake uphe language the status quo? >> this is developed over many decades. price in which the price is, in some sense, fixed. but basically you give us this and we will pay you x. the risk is on the contractor. it says we are not sure

. we will reimburse you for the cost plus some mechanism. >> i know this is driven by some mark. own ismy personal history running a business and it removes the incentives for my organization to innovate. at the same time, i think we should avoid overly broad brush strokes. it is also important to understand the underlying intent which is about cost growth and about managing the relationship and the commercial apartments. >> the traditional paradigm has be

, that it is a stretch and something hard to do. is, the contracts come with a lot of administrative and bureaucratic tag edge because it is not something the commercial , they don't have the accounting mechanisms to do that. the smaller and more innovative forms being part of the process. will this be a bridge to commercial firms ultimately? >> they will let you know what it will be voted on. if implemented as intended, it will create an opportunity for purely commercial businesses. and that is a very good thing.

>> on this week's money minutes, personal finance expert offers advice to veterans interested in starting a business. >> they are a force to be reckoned with. the office of advocacy, almost 10% of small business owners are veterans. if you're beginning to think about your second career, a home business is a viable option. one has more drive, discipline, and dedication than are men and women in uniform. they also equip individuals with the savvy needed to have a company with a strong bottom line. you are interested in prescribed courses of action.

with so many marketable skills, it is a benefit. being detected was not an option. if i was recognized the whole operation was blown. the element of surprise was imperative. wow. he won't even recognize you. seriously. i don't even recognize myself. and thanks to my cashrewards credit card from navy federal with never-expiring rewards it's gonna be a killer honeymoon. woo! maui!! boom open to the armed forces, the dod and their families. navy federal credit union.

>> no question the u.s. makes a pretty penny on arms sales but could our customers be our biggest competitors? we sat down with doug bernsen, managing editor to find out.

degree of technology transfer by the supply. u.s. firms have enabled companies in other countries to jumpstart their basis. we see this increasingly gathering speed as many of those countries are starting to compete in the international defense marketplace on their own. you identified three big potential competitors coming up. let's start with israel. israel has a unique relationship with the united states. they're able to access large amounts of military finance and credits. they have used that substantially to buy u.s. military platforms. has allowed israel to focus its own activities in other sectors. missiles, defense electronics and unmanned aerial systems. it is a substantia

>> brazil is an up and comer. their defense sector is also growing. >> brazil can take a base and repurpose it toward military. access to technology to enable them to compete increasingly in the military marketplace. is that with substantial defense r&d. most significantly it will be cooperation with the aircraft that will access a substantial amount of technology transfer and really be a presence and marketing that aircraft.

>> they are developing their own fighter. >> south korea has a much broader based defense market. has ath korea long-standing success on the electronic and shipbuilding side. south korea has had a somewhat .ore ambitious agenda and has been looking to identify up and down.

>> they have not operated in the same market space. , spendingand china was not very high. that, i think, is starting to change as china puts more and more money into the defense r&d program. it is coming out with products with substantial capability and appeal around the world. stepped backas from certain markets or alienated some customers, they are starting to look to china more and more as a totally viable supplier. we have seen this in unmanned aerial systems, to some degree in fighter aircraft.

>> a substantial portion of the is reallyudget focused on very high and systems that have little or no potential to export. the 21 bomber, submarines. the either have no export market anthe timeline to having export version will be very long. >> that is all this week. check out the latest in the defense industry at defensen ews.com. use #dntv. thanks for joining us.

[music] >> dr. charles stanley: people who argue about the bible, they don't even have any i--they don't even have an idea why jesus came. they'll say, "well, i know jesus was born and this, that, and the other, but he was just another man." no, he was god walking in human flesh among men in order to die