Friday, February 17, 2006
by Sheri Qualters Journal Staff
Three years ago, InterSense Inc., a technology firm whose work finds its way into military hardware ranging from pilot trainers to simulators that train soldiers to steer Stinger missiles, made a high-stakes bet. It gambled that the helmet worn by the soldier of the future would bring his commanders as close as his 3-D audio speakers, enabling him to hear commands and information from other soldiers, even amid the din of the battlefield. What's more, sensors could give him a visual map of the positions of friendly and enemy troops.
Acknowledging that the company was too small to go it alone as a prime military contractor on the project, the technology maker forged ties to a pair of other military contractors to make a grab for millions in military funding earmarked for high-tech battle uniforms.
When those initial partners fell away, Bedford-based InterSense partnered with others. The group has crafted prototypes and hopes to sell the military on the helmet, a milestone that could, for $10 million-sales, 29-person InterSense mean a share of a deal that would put the technology on thousands of soldiers in years to come. This early in the military's product selection process, it's almost impossible for InterSense to know the value of such a contract.
"It's a tremendous opportunity for us," said InterSense Marketing Manager Dean Wormell. "The idea of putting a sensor on every soldier is a very large market."
InterSense is one of 26 Bay State companies that have captured some 95 percent of an estimated $6.9 billion expected to be spent in New England in the U.S. Army's Future Combat System program. While defense giants like Raytheon Co. and GE Aircraft Engines regularly seal headline-making deals, small technology innovators like InterSense are among the cadre of Bay State companies queuing up for a share of the Pentagon windfall.
Massachusetts' high-tech know-how fits the general philosophy of the Future Combat System program, the Army's attempt to equip a "faster, more agile force with superior situational awareness and power projection capability," says the program's Web site.
Touted as the Army's modernization program, Future Combat's goal is a networked system of soldier equipment and unmanned air and ground devices that gives troops instant information about battlefield threats while reducing command center support needs.
Textron Systems Corp. of Wilmington, which makes remote, expendable reconnaissance sensors, and iRobot Inc., the Burlington maker of remote-controlled robots used to spy danger in urban settings, are among the Massachusetts-based prime contractors tapping into the Future Combat program -- meaning the military purchases the finished products from them.
Other companies hoping to capture subcontract roles in the Future Combat program include computing and graphic modeling software maker MathWorks Inc. The $350 million-sales company already counts the aerospace and defense industry as its top customer group, and the Future Combat program is a prime example of the type of software-intensive military programs driving those sales, said Dan Raun, the industry manager for aerospace and defense at Natick-based MathWorks.
"One of the things that strikes me is the pervasiveness of the communications systems they need to use," Raun said. The company declined to discuss potential revenue impacts.
Traditional manufacturers and distributors are also collecting Future Combat spoils, including North Andover custom cable and connector maker L-com Connectivity Products Inc. L-com's military work took off in 2003, said National Accounts Manager Carol Lee Williams, around the time L-com forged a connection to Future Combat through prime contractors.
Increased military work has already spurred the 110-employee, $30 million company to add 13,000 square feet of additional factory space over the past couple of months, giving it to 46,000 square feet in all, Williams said.
Future Combat is significant enough for L-com to develop a focused sales strategy for the program.
"It's such a huge project," Williams said, "I have no doubt it's going to be six-figures plus."
As the program moves from the R&D phase into testing this year, state officials and defense leaders are mapping out strategies to get more Bay State companies into the spending stream. President George W. Bush's fiscal 2007 budget earmarked $3.7 billion for Future Combat.
State officials are increasingly attentive to the needs of small and midsize defense contractors.
Massachusetts' economic development chief, Ranch Kimball, said his job is selling state incentives like tax credits and tax increment financing for capital improvement projects that have "traditionally not been used by defense firms."
"It's a very strong hand we've got; we need to make sure we play it well," Kimball said.
New England's $6.9 billion in potential Future Combat program work, out of the program's $127 billion total price tag, is an "eye popping number," and the Massachusetts High Technology Council is turning its attention toward boosting that take, said President Chris Anderson.
The council organized a conference at Textron Systems this month for Future Combat contractors, and topping this year's military agenda is hosting another such event for other technology companies who want to learn about the Future Combat program.
"One of our objectives is to create, within this single program, more opportunities for the region's technology community to participate and help shape, supply and bring in new innovations," Anderson said. He said the council can help facilitate that collaboration.
Until recently, there wasn't a concerted effort to lure defense work to the region, Anderson said. "That is something that was missing, the ability to provide that type of catalytic energy."
Sheri Qualters can be reached at squalters@bizjournals.com.
