The Defense Department's spending on artificial intelligence and machine learning contracts continues to expand and is now projected to surpass $1 billion this fiscal year and to double within the next few years, according to a new analysis.
DOD's contract spending on AI and ML is projected to reach $1.4 billion in fiscal year 2020, up 43 percent from the $973 million obligated in FY-19, according to market research published by Bloomberg Government analyst Chris Cornillie.
Cornillie said the true number is likely higher due to classified contracts as well as a lack of publicly available data on how much spending is occurring within consortia-run other transaction agreements.
"Those contracts are black boxes," Cornillie told Inside Defense.
DOD contract spending on AI is expected to continue its steady rise to $2.8 billion by FY-23, according to the analysis.
So far, U.S. Special Operations Command is the Pentagon's "top AI investor," according to the research, as it has spent $620 million on the technology since 2016. SOCOM's $885 million task order to Booz Allen Hamilton in July 2018 for the Enterprise Machine Learning Analytics and Persistent Services (eMAPS) "is the largest AI/ML contract yet issued by the federal government," according to the research.
Meanwhile, the Pentagon's Joint Artificial Intelligence Center "is still in the early stages" of driving DOD's AI spending, Cornillie said.
The center has awarded two large contracts this year. In May, it awarded Booz Allen Hamilton a potential five-year, $800 million for its "Joint Warfighting" project. Meanwhile, it awarded Deloitte Consulting a four-year, $106 million contract to be the prime integrator for the "Joint Common Foundation" program.
Among vendors, Booz Allen Hamilton is the top AI and ML contractor for the defense sector, according to the analysis. It shows the firm has raked in nearly $600 million in AI and ML contract obligations since 2016.
ECS Federal is second among defense vendors, as the company has been awarded two contracts for the Pentagon's "Project Maven" effort. Less well-known small businesses, including firms like Dzyne Technologies, Koniag, Modern Technology Solutions, and Prelaten, have won a collective $780 million in AI and ML obligations since 2016, according to the report.
The Pentagon's requested funding for AI-related programs is also growing. While DOD presented its official budget request for AI in fiscal year 2021 as $1.1 billion, "this figure likely undercounts [the] full scope of AI activity," according to the analysis.
The research found the Pentagon is seeking a combined $5.2 billion in FY-21 for 319 research and development programs with "some AI/ML component," up from $4 billion in DOD's FY-20 budget request.
After appropriations and transfers, Cornillie's analysis notes DOD's FY-21 budget for AI and ML "could be even higher."