CRS report on artificial intelligence, China, and acquisition

The following is from an excellent CRS report, “National Security and Artificial Intelligence.” I’ll forego the indentation. Note that more recent Bloomberg estimates put the Pentagon’s AI funding in the FY2020 budget request at just over $4 billion. That’s a seven fold increase in just four years. The numbers are pretty hard to pin down because the budget doesn’t have an AI program element (PE). Instead, AI projects are spread across various programs.

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The field of AI research began in 1956, but an explosion of interest in AI began around 2010 due to the convergence of three enabling developments: (1) the availability of “big data” sources, (2) improvements to machine learning approaches, and (3) increases in computer processing power. This growth has advanced the state of Narrow AI, which refers to algorithms that address specific problem sets like game playing, image recognition, and navigation. All current AI systems fall into the Narrow AI category.

… the growing power of Narrow AI algorithms has sparked a wave of commercial interest, with U.S. technology companies investing an estimated $20-$30 billion in 2016. Some studies estimate this amount will grow to as high as $126 billion by 2025. DOD’s unclassified expenditures in AI contracts for FY2016 totaled just over $600 million, increasing to over $800 million in FY2017…

DOD may need to adjust its acquisitions process to account for rapidly evolving technologies such as AI. A 2017 internal study of the process found that it takes an average of 91 months to move from the initial Analysis of Alternatives, defining the requirements for a system, to an Initial Operational Capability. In contrast, commercial companies typically execute an iterative development process for software systems like AI, delivering a product in six to nine months. A Government Accountability Office (GAO) study of this issue surveyed 12 U.S. commercial
companies who choose not to do business with DOD, and all 12 cited the complexity of the defense acquisition process as a rationale for their decision.

Recent Chinese achievements in the field demonstrate China’s potential to realize its goals for AI development. In 2015, China’s leading AI company, Baidu, created AI software capable of surpassing human-levels of language recognition, almost a year in advance of Microsoft, the nearest U.S. competitor. In 2016 and 2017, Chinese teams won the top prize at the Large Scale Visual Recognition Challenge, an international competition for computer vision systems.

China is researching various types of air, land, sea, and undersea autonomous vehicles. In the spring of 2017, a civilian Chinese university with ties to the military demonstrated an AI-enabled swarm of 1,000 uninhabited aerial vehicles at an airshow. A media report released after the fact showed a computer simulation of a similar swarm formation finding and destroying a missile launcher. Open-source publications indicate that the Chinese are developing a suite of AI tools for cyber operations…

China’s centrally-directed effort is fueling speculation in the U.S. AI market, where China is investing in companies working on militarily relevant AI applications—potentially granting it lawful access to U.S. technology and intellectual property. Figure 2 depicts Chinese venture capital investment in U.S. AI companies between 2010 and 2017, totaling an estimated $1.3 billion.

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