Where DoD IT priorities remain as the second half of fiscal 2024 begins


ImmixGroup market intelligence manager Ryan Nelson breaks down defense IT spending around four key areas: data, cyber, AI and infrastructure.

With the recent release of the White House’s fiscal 2025 budget proposal, it’s important to remember we are now entering the second half of fiscal 2024 spending. For government contractors, as they enter this period of bidding and awards, it’s important to focus on where the Department of Defense will focus its IT spending.

The final congressional agreement for 2024 budgeting set DoD funding at $825 billion, only somewhat less than the original request. It also offers flexibility to reallocate funds without Congressional approvals, within and among programs at a “below threshold” level of $15 million.

The DoD’s requested Information Technology/Cyberspace Activities (IT/CA) budget of $58.5B represents approximately 7percent of its resources. Cyberspace budgeting increased from fiscal 2023 but is now concentrated in the DoD due to funding for U.S. Cyber Command shifting from the services to the DoD budget.

Vendors can set up for success by understanding these priorities and presenting their capabilities in the context of the following key initiatives.

Overall IT priorities, from cybersecurity to infrastructure

The DoD’s budget emphasizes four categories: cybersecurity, data analytics and storage, AI and infrastructure.

For cybersecurity, the Army, Navy, Air Force, and the Defense Information Systems Agency continue to focus on implementing zero trust authorization, while the Office of the Secretary of Defense considers how to improve the security of small business systems and prepare them for CMMC certification.

The requested budgets for big data-related projects continue to grow across Army, Navy, Air Force, and fourth estate agencies, or agencies that are not part of the military services but still part of DoD. These projects range from updating and securing existing data sets to implementing data analytic tools to improve management capabilities.

Regarding AI, experimentation continues across the fourth estate as organizations such as OSD seek ways to integrate the technology into every facet of daily operations. Operationalizing AI/ML[DM1]  for Combatant Commands is a key priority for 2024.

Finally, modernization of existing IT infrastructure is a major priority for every defense agency during fiscal 2024. Major modernization efforts include improving cybersecurity systems for zero trust compatibility, improving efficiency of existing systems with automated tools and migrating specific capabilities to the cloud.

Here are some of the key programs by agency that will be seeing the greatest interest.

Army: Commercial airtime, combat support and business systems

Commercial Satellite Airtime (COMSAT): With an original request of $114 million, this initiative supports a centralized program for the management of COMSAT airtime across the Army. The program includes support for all army programs and consolidates COMSAT requirements to support validated missions. The objective is to arrive at centralized management for the procurement and execution of all COMSAT contracts.

Global Combat Support System (GCSS): With a $129 million request, GCSS provides a seamless flow of timely, accurate, accessible, actionable and secure information to the soldier, at a level not currently available. The program streamlines supply operations, maintenance operations, property accountability, logistics management and integration procedures.

General Fund Enterprise Business System (GFEBS): Originally budgeted at $96 million, GFEBS is the core financial management system for administering the Army’s General Fund, improving performance and standardizing business processes. GFEBS supports the Army and the DoD with accurate, reliable and timely financial information.

Navy: Maritime maintenance, aviation logistics and personnel  

Navy Maritime Maintenance Enterprise Solution (NMMES): Originally budgeted at $121 million, this program funds sustaining deployed systems, and the modernization and technology refreshment of ship maintenance and national systems. The program will incrementally replace legacy and end-of-life systems with modern commercial information management.

Navy Personnel and Pay (NP2): With a $142 million request, this program supports the configuration of commercial-off-the-shelf software to meet MyNavy human resource requirements and will integrate with a Direct-to Treasury Pay capability to improve audits. The program uses an automated and cloud-hosted IT system for HR-related tasks.

NAVAIR Aviation Logistics Environment (ALE): Originally budgeted at $55 million, this program delivers full-lifecycle weapon system logistics and maintenance capabilities via the Naval Aviation Support Process (NASP).

Air Force: Data exploitation, cyberspace integration, and command and control

Data Exploitation: Originally budgeted at $119 million, this program focuses on exploitation of multiple sensor data. Key areas of technological concern include data collection, processing and fusion, data dissemination and application, and algorithm development and testing. It also includes network connectivity and sensor performance assessments.

Integrated Defensive Cyberspace System (IDCS): With a $99 million request, IDCS is a modern, containerized software-based system. IDCS will be deployed to physical, virtual and cloud-based hosts and provide for interconnectivity, management and data processing.

Air Force Command, Control and Communications (C3): Originally budgeted at $71 million, the C3 program would offer cloud-based IaaS/PaaS hosting to deliver mission applications and data. Funding is aimed at enablement services, data science, data engineering, machine learning, AI and process automation.

DISA priorities: Zero trust and SIPRNet modernization

It’s important to note that DISA also has access to funds that are not directly appropriated by Congress. The Defense Working Capital Fund (DWCF) accounts for the majority of DISA’s IT budget. In fiscal 2023, the DWCF dispersed more than $8 billion in support of DISA’s IT programs and operations. Roughly $200 million of that funding was used for development, modernization and enhancement. This level of financial support is expected to continue during fiscal 2024.

Zero trust architecture: Originally budgeted at $590 million, this program focuses on the implementation of Thunderdome. That program integrates with Policy Decision Points (PDPs) that use identity, device and environment attributes to make user access decisions by application. It also moves security closer to the customer edge and it enhances cloud security analytics to support cybersecurity defense.

DODIN Engineering Services: With a $74 million request, this initiative modernizes the Secret Internet Protocol Router Network (SIPRNet), thus improving the security and resiliency of the DoD’s warfighting network. These capabilities will improve the security and defense of email traffic, both within and outside of SIPRNet.

Defense Health Agency (DHA): Improved patient experience

The DHA has seen a drop in Development, Modernization and Enhancement (DME) funding to $123 million in fiscal 2024 versus $400 million in fiscal 2023, due in large part to the removal of one-time budget increases in the Defense Health Program’s medical research, development, test and evaluation portfolio. DHA’s overall goal is an improved patient experience, as indicated in two of its programs.

Leveraging technology to improve patient experience: This initiative would fully integrate a military health systemwide toll-free telephone number and a portal that enables real-time chat and asynchronous text. Machine learning and AI guides beneficiaries to the most clinically appropriate source of care. It integrates with all patient-to-provider, provider-to-provider and complex real-time capabilities, and it facilitates scheduling with the TRICARE network.

Fully integrated healthcare system for the person: This program focuses on fully integrated clinical care coordination model pilots. It focuses on movement of patient information between direct care, purchased care and other partnerships, including the Veterans Health Administration.

These selected initiatives are some of the key DoD IT and cyber programs receiving funding in fiscal 2024. By understanding these activities, and positioning their services and product offerings accordingly, vendors will be able help meet the challenges DoD’s agencies have set for themselves.

For more information or to speak with an immixGroup market intelligence expert to better understand opportunities in the IT budget, contact us.

Ryan Nelson is market intelligence manager for immixGroup, the public sector business of Arrow Electronics. immixGroup delivers mission-driven results through innovative technology solutions for public sector IT. Visit www.immixgroup.com for more information.