There’s an interesting trend underway, happening quietly in the shadow of persistent talk from the Pentagon about modern warfare, about tech innovation, about near-peer competition.

Industry is placing bets.

I mean, of course they are. They always do, and quite expertly. Defense companies are incredibly skilled at tracking program funding (and leadership commentary, and policy reports, and Hill testimony, and so on and so on) to read the tea leaves of the market and invest accordingly. You might say in fact that industry has a history of understanding what the Pentagon needs before the Pentagon does. Just look at the track record of Lockheed Martin’s Skunk Works and Boeing Phantom Works.

But the situation these companies face now is a little different. The Pentagon is arguably placing more collective emphasis than ever before on what some might call unproven technologies. Services have acknowledged being preoccupied by kinetic and conventional warfare tactics in Afghanistan and the Middle East, even as some near peer adversaries funneled dollars into advanced technologies. Now it’s a scramble, with the Pentagon placing bets of its own for what the future battlefield will look like. A clear focus on unmanned and robotics is starting to share the spotlight with hypersonics and directed energy. And then there’s artificial intelligence, which seems to be infused into nearly everything.

Those are the areas captivating the Pentagon. But they’re also not the typical quarter-turn of the screw that the defense industry is used to being “innovative” in the eyes of the defense customer. These are new concepts. In some cases, they’re experimental. In other cases, they don’t exist yet.

That said, these are also pretty wide-open markets. And that’s attractive to industry.

Consider Northrop Grumman. The company launched a new campaign website focused on hypersonic defense. It’s a clear message to the Pentagon, which expects to spend more than $10 billion in the next five years to develop offensive and defensive capabilities. From the company’s approach of announcing this campaign with a degree of fanfare to the hint of mystery tied to what it actually will encompass, this was clearly an effort to make some noise. Was the company’s acquisition of Orbital ATK partially rooted in grand plans to tackle this market? Hard to say; the company did acknowledge Orbital added “extensive” relevant capabilities. I suspect that whether the acquisition was tied to this effort or not, Northrop is perfectly happy that I and others are asking the question.

And M&A is certainly a tactic for gaining an edge fast, which we’re seeing a lot of lately. Unmanned, further along than hypersonics in adoption, has experienced a flurry of M&A activity as larger defense companies seek to plant a flag. Boeing perhaps had the most foresight, buying in 2008 long-time partner Insitu, which touted an established footprint in military drones with its ScanEagle. Now, more than a decade later, Boeing has been pushing that asset front and center more than ever to reflect a history and expertise that it simply would not have been able to deliver organically. PAE stood up PAE ISR after a series of acquisitions in the unmanned space, with the subsidiary specializing in national and international unmanned security missions. It’s focus on military has been limited, but it’s pushing hard now to get a foothold. Or consider FLIR, known for decades for cameras and sensors, which in 2016 bought Prox Dynamics, maker of the sparrow-sized Black Hornet micro-drone; and in 2019, acquired drone-maker Aeryon Labs as well as Endeavor Robotics, which brings a host of tracked unmanned ground vehicles.

Some of these efforts will fail. Some will face market saturation, much like we saw with cybersecurity a number of years ago, where so many companies jockeyed to dominate that most got drowned out amid the noise. Others will take years to see a return. These are gambles. But it means companies are listening.