Allen Control Systems’ Steve Simoni & Axios’ Colin Demarest

0:00 [Music] Good to see you, man. >> Thanks for being here. >> Yeah, man. >> Thanks for having me. >> Of course. >> So, we have about 11 minutes here. So, this might feel like a bit of a >> Let's rapid fire. Let's do it. >> Let's do it. Rapid fire like the bullfrog. >> Yeah. >> How would you assess the state of AI and autonomy inside the US military as we're sitting here today? >> Um, well, I would I would probably say that we are a little behind. um you know all of our weapon systems need to be enhanced with some form of uh additional autonomy because if you think about it taking a step back um in China they are manufacturing drones at an unprecedented rate and these things are incredibly lethal and incredibly cheap and they fly very fast and they can take out million-dollar pieces of artillery. They can crush tanks like never before. And it's a it's a massive problem. And so we need an autonomy, a stack across different sorts of products to neutralize this threat. And I think right now, as you're seeing on the battlefield in uh Ukraine, there's really not a good solution for it yet.

0:59 And so, you know, we're one company, but a lot of us are all trying to figure this out right now. >> When you say behind, are we talking China? Are we talking Russia? Are we talking North Korea? Or all three? Well, I well, Iran, uh, Russia, China, these countries are making all making drones, advanced drones. Um, and from a manufacturing perspective, we're definitely behind on that. But on a software side of the house, which again, America's always led in software. That's one of our core strengths. We have great universities. Um, but it's a matter of actually getting them procured. So, like there's a lot of great technologies needing to be unlocked. Uh, and you know, you're seeing the administration right now make a lot of big changes. Um, you see the new task force for countering drones. A lot of big changes right now to help actually get this stuff onto the battlefield and into war fighters hands.

1:43 >> Let's go that direction of that task force. What letter grade would you give the US military for its drone defenses right now? And what does the task force need to be successful? >> I give right now I give us a D. Like we're we're not we're barely pass I guess that's is that passing D? I have only ever gotten. So, >> um, no, we're, yeah, we we don't actually, uh, we're not we're not doing well like currently. Um, but we have a path to do a lot better. Um, and so you're seeing like, you know, for the last 8 years or so, our country's invested in electronic warfare. So, that's basically like trying to zap the drones out of the sky. Um, or, you know, jam the communication, jam the GPS of the drone. Um, so electronic warfare is like a soft kill measure. The problem is if you look at what's happening in Ukraine, Russia has a new version of the Iranian shahed. You can't jam that anymore. Like it's not it's really much harder to jam these now. And we've invested in, you know, some of the wrong things. Um and so you're starting to see a lot of the industry trying to change that and catch back up because u the soft kill measures aren't really working aren't going to work that well for the next couple years.

2:48 >> And with that task force uh that Secretary Hagath announced, are you in talks with them? Have you consulted with them? and how would you like to help them achieve their their goals? >> Yeah, we're we're very excited at Allen Control Systems about the task force. Um yeah, we we're in talks with them. They are they seem to have a lot of um you know, energy right now. They have a they have budget and they have authority.

3:11 They're the task force has a lot of teeth. So, we think it's going to drive a lot of change and we're really happy with what the administration has done. >> Do you think the army leading that task force was the right decision? >> Definitely. Yeah. If you think about it, like we we need to make uh tanks great again. And uh the army has a lot of tanks and you know, one of the ways to make them great again is to be able to let them counter drones because right now with the tanks, you know, going to hit them with a drone. So, we need some new solutions and the army heading it up actually makes a ton of sense.

3:39 >> And let's stay on counter drone. What do you think the US needs to prevent a tower 22 attack overseas again or a operation spiders web here domestically? take the overseas one first, maybe a little easier. Um, because obviously spiders web is a very distributed attack, which would which would mean we need a lot of stuff in a lot of different places. Um, on a base overseas like tower 22, we need a layered defense system. So, of course, we still need to have the electronic warfare cuz, you know, hopefully maybe some of these drones are the older style that you can still jam. So layer depends with that plus a kinetic solution like Bullfrog um which is like a our AI machine gun um to shoot drones and then you know maybe another sort of um you know potentially other sort of soft kill solutions layered in with that and then better tracking and like better knowledge of the full battle space the full airspace because these things can come from anywhere and so you you a lot of times our systems only look like one direction so we need like better like full bubble search of the sky. How are you guys at ACS thinking through networking and kind of the tasking and queuing because it said in the video you guys are fad C2 lattis ATAC enabled.

4:45 >> Yeah, I mean the the way it works as a government contractor is you know we have a product um like our like Bullfrog and depending on which branch of service you're working with could be the Marines, Army, Navy, they all use different uh what's called command and control software. One could come from one company like North of Grumman. One could come from and one could you know there's the Marines have a one that comes from not one of those primes. So you're the job is to make sure to integrate with whichever platform you're going on. And so there are many command and control softwares in the military which means you have to hire a lot of engineers.

5:18 >> Basically >> with Bullfrog there's a bunch of variants right uh including M240 which is a reference to the very widely available machine gun out there. Shoots 762 NATO. Yeah. >> Why did you go that route uh with such a widely available ammunition and weapon? >> It's all about the cost curve. So the the M240 is a widely available gun, the standard NATO ammunition, 762 round. We wanted to be able to use the cheapest ammo. If we make a robotic solution that's so precise and so um fast and quick moving, you can use like really cheap bullets. That's like the innovation we've unlocked. Um, and the drones again, ranging from a,000 to $10,000 for these small FPD drones.

6:00 Interceptor missiles just really don't make any sense. Um, and right now what we're doing, we we're invested in a lot of electronic warfare like I mentioned. And then the other thing we invest in as a military is interceptors. The the US military, uh, we make some of the best interceptors in the world. But, you know, you can only they're more expensive than the drone. And so that's just not going to be long-term sustainable. to that point, right? You look at the Red Sea, you're seeing standard missiles taking down multi-million dollar standard missiles taking down $10,000, $100,000 shaheds.

6:29 What lessons have you pulled from that conflict? The Navy expended, I think, more than a billion dollars in those exchanges >> and how are you applying that to your work? >> I mean, the main lesson is that what what's happened, what's changed is that any country or clandestine group can now wage an effective war. It used to be expensive for a country to wage war, but now with the advent with the, you know, the the rise of the drone, it's just it's very easy to be disruptive. So that's what we that's the main thing from a strategy perspective, we're learning, which obviously isn't fun for our country. Um, and then from a just operational standpoint, you know, we're not going to let these Houthy drones hit our warships. So we're going to we'll take them out with what we have currently. Um, and again, but we need to get our manufacturing built up to be able to like buy those expensive artillery shells or, you know, interceptors, use those, but in the meantime, also invest in solutions like ours, which is going to be like a a much cheaper way to do this long term.

7:24 >> So, I've always seen Bullfrog in the back of a truck. It was at it was in the back of a truck at Reindustrializing Detroit. >> Do you foresee naval integration to the point about warships? Um, where else are you guys looking to put the turret? So every mounted gun on every vehicle for pretty much every military that's our NATO and our ally other close allies and all the US you know army navy marine corps any mounted gun on any vehicle needs to be replaced with an AI version of that of itself in the next 5 to 10 years um so that's a lot of uh vehicles as you can imagine because they all need to be able to shoot drones because every vehicle is now in jeopardy like you can't go from point A to point B on the battlefield without potentially getting ambushed by FPVs laying in cornfield.

8:07 >> They've strung up those massive overhead nets. >> Yeah. I mean, yeah, they Yeah, the nets, you know, that's a good that's kind of a solution, I guess. But you know what they do against those is they just send three drones. First one blows up the net and then the next two come in and finish off the rest. So stuff >> with Russia, Ukraine, um particularly Russia recently, we saw those air incursions from Russian drones into Poland, um into Romania, I believe, but the the Poland one has been widely reported. Scrambled F-35s, talk about cost curve.

8:34 >> Yeah. >> What are your takeaways from that? Um, can NATO properly protect its airspace? And if not, how can it get there? >> I mean, you're seeing Estonia, Poland, Romania, you obviously Ukraine. These are the countries are all gearing up because they know that Russia will not stop. They're they're coming and it's happening. In Estonia, they're digging trenches right now. Like, so they're these countries are smart. They're buying stuff. I think Poland's like buying tons of tanks right now to prevent a land invasion. Um they're they're you know scared and they're they know what's happening and so yeah I think I think NATO will step up. I think our administration expects them to step up. You're seeing that. Um and I think they are responding and doing it >> with the 5% spending is what >> Yeah. Yeah. Yeah.

9:22 >> Do you think the drone incursion was an accident as some have said? >> Uh I think it was like a warning shot across the bow like get ready. Do you expect more of that to come and are you get are you guys getting ready for that? >> Well, I'm trying to, you know, get the product out to the over there so that we can you help out of course to Ukraine. >> Yeah, Ukraine and then all the surrounding countries as well.

9:43 >> And what do you attribute this explosion of physical AI to smart machinery, robotics, drones especially that are jam-proof so to speak. >> Yeah, robotics is an incredible like growth industry. I mean I as a kid, you know, electrical engineer, I was making robots. uh my co- business partner Luke Allen, you know, he's been making robots since he was a kid. And now you're seeing that these things we were making as children are like becoming massive businesses and investors are pouring tons of money into this, not just in defense, but you know, see the humanoid robots, seeing all kinds of this stuff.

10:12 It's it's really like incredible to see. And it's because the robotics industry like now like the servo motors, the gears, the joints, like the software, it's all becoming it's all this like really advanced now that the robots can do are a lot more capable than when we were kids. At any point did you argue for it to be called Steve Control Systems? No. Alan System. >> Well, my last name is Simony and that's like an Italian name and Simony Control Systems doesn't sound very as good as like I don't I don't trust that. It's got to be Allen Control Systems. It's much more American name.

10:41 >> What do you say to kind of the defense tech haters? A new Galllet poll uh found 48% of America Americans, excuse me, oppose the development of AI enabled weaponry. Well, I'm not seeing that with the kids graduating. I mean, pretty much every top school that does robotics wants to be a part of what we're doing. So, I'm not seeing it there. But, I mean, as a on the national poll, I believe the polling numbers um I think that is maybe a little misguided like we're we're doing this to defend the country to project power so that you know the our adversaries don't continue to encroach upon our territory. We got a few seconds left here and I would be remiss if I didn't ask this. Last September I interviewed you. You were one of the first interviews for Future of Defense and at the time you said you were Palmer maxing.

11:30 What does that mean to those who aren't hip enough and are you still doing it? >> Um, no. I've moved to Alex Karp maxing. Now I'm trying to get the hair. It's not wild enough but they that's cuz they did it back there. They but I wanted them to go. >> Did you ask for the Alex Karp in the group? >> Yeah, they didn't do it for me though. No, Paul. No, I think like look, we look up to these they they start like Ando, Palanteer. These companies kind of helped pave the way um for companies like ours. They've brought a lot of attention and investors here and we thank them a lot. Yeah, Steve, we're going to have to leave it