Intelligence Percent of Revenue
Rankings (Lockheed Martin):
Washington Technology Top 100: #1/$13.4 billion in contracts
Defense News Top 100: #1/$41.8 billion annual revenue
"Everyone talks about the intelligence community as ‘those guys in government,’ whether it’s the people in the military or the people in the agencies. Well, guess what? You are all part of the intelligence community. In fact, you probably make up the largest part of it." -- Ben Romero, the director of Intelligence and Homeland Security Programs for Lockheed Martin, speaking to a roomful of contractors in Washington, D.C., 2005.
Lockheed Martin is the largest of the top six systems integrators that dominate the intelligence contracting industry, and is particularly significant in the areas of surveillance, reconnaissance, signals intelligence, and network-centric warfare. With $42 billion in revenue and more than 52,000 cleared information technology personnel in its workforce, Lockheed Martin is the world’s largest defense contractor, and employs what may be the largest private intelligence force on the globe.
It is also the single largest contractor and the largest IT provider to the U.S. federal government. Its slogan, repeated frequently in television ads, is “We never forget who we’re working for.” In intelligence, that would be all the major collection agencies, particularly the National Security Agency, the National Geospatial-Intelligence Agency, and the National Reconnaissance Office, as well as the Department of Defense and the many military intelligence agencies (see Tim Shorrock, Mother Jones, “Out of Service.”)
ORGANIZATION. Lockheed Martin employs more than 140,000 people and is divided into three operating units: aeronautics, including tactical aircraft and R&D; space systems, including commercial and military satellites; and systems and IT, which includes C4I – the military acronym for intelligence and reconnaissance, and IT. Intelligence is a key part of all three divisions, but most of the company’s contracts are held by the IT division, Information Systems & Global Services, or IS&GS. "Some of our work, you will never hear about," the company website says. "Our classified work has supported the Defense Intelligence Agency (DIA) and National Security Agency (NSA) as they dealt with the most high-visibility situations in recent US history and many others you never saw on the news."
NATIONAL SECURITY AGENCY. Lockheed Martin has extremely close and long-standing ties with the NSA. In the mid-1950s it built the U-2 spy plane that played a key role in the Cold War and conducted some of the NSA’s initial research in signals collection. “The U-2 has been the backbone of our nation’s airborne intelligence collection operations for several decades and continues to provide unmatched operational capabilities in support of Operation Enduring Freedom,” Lockheed Martin states in its 2008 annual report. The U-2 “is expected to continue to provide leading-edge intelligence collection capabilities for years to come.”
The company’s extensive contracts with the NSA first became public in 1997. That year, Margaret Newsham, a contract engineer working for Lockheed Space and Missile Corporation at an NSA listening post in the United Kingdom, disclosed to Congress the existence of Echelon. This global surveillance network is run by the NSA and its counterparts in Britain, Australia, New Zealand, and Canada. She made the disclosure after hearing NSA intercepts of international calls placed by Sen. Strom Thurmond, the conservative South Carolina Republican. Her revelations sparked a spate of Congressional inquiries into whether the NSA was illegally listening in on domestic conversations. The discussions, led by a Republican civil libertarian, Rep. Bob Barr of Georgia, presaged the intense debate that would follow the 2005 revelations about President Bush’s “Terrorist Surveillance Program.” In July 1998 a report commissioned by the European Parliament confirmed that, through Echelon, the United States, and its closest allies had the capability to intercept most European phone calls, emails, and data communications, as well as the technology to decode almost any encrypted communication. This revelation sparked deep suspicion in European capitals that NSA was using Echelon to capture European business intelligence and trade secrets and pass them to U.S. companies.
Under a contract signed in 2005, Lockheed Martin provides an integrated electronic security system to protect NSA facilities in the Washington area. A similar system is in place at the Pentagon and dozens of U.S. military facilities abroad.
KEY AGENCIES. Lockheed Martin is an important contractor for the National Geospatial-Intelligence Agency (NGA). In one major project for the NGA, Lockheed Martin is developing a “ground-based infrastructure” designed to help users of the agency’s satellite and imagery data better distribute, share, and exploit the information. The contract, “Geo-Scout,” was awarded in 2003 for an unspecified amount, and is proceeding in four “blocks” that could take up to 10 years to complete. The ultimate goal, NGA officials say, is to create a system that seamlessly blends data from unclassified commercial and classified military satellites. The project, now in Block Two, is managed by Michael Thomas, a Lockheed Martin vice president in its Integrated Systems & Solutions unit. Its future, however, is uncertain: Geo-Scout is frequently cited by intelligence analysts, along with the NSA’s Trailblazer, as an overly expensive project in which government managers ceded too much power to the contractor.
At the Pentagon, Lockheed Martin was one of the contractors that provided counterintelligence analysis for the Counter-Intelligence Field Activity office (CIFA). Its jobs included tracking “logical combinations of keywords and personalities,” estimating current or future threats, creating and delivering reports, and monitoring current intelligence of specified contracts. In 2006, the company was hiring personnel for a “performance planner” who would “develop and analyze missions, program goals, [and] objectives and systems” for CIFA. At the Defense Intelligence Agency, which now manages CIFA, Lockheed Martin runs a bidding consortium that claims to have the largest cleared workforce in the nation and, according to the Lockheed Martin website, provides “exceptional depth to respond to both surge requirements and planned customers tasks.” The consortium’s forte seems to be providing large, agency-wide IT systems for the DIA and other agencies. The team includes three of the top U.S. IT firms, Hewlett-Packard, Oracle, and Sun Microsystems, as well as the consulting firm BearingPoint, which helped plan the 2003 U.S. occupation of Iraq for the Department of Defense. Another member of the team is The Analysis Corporation, the intelligence contractor run by CIA veteran John Brennan.
NETWORK-CENTRIC WARFARE. As one of the prime suppliers of reconnaissance and surveillance technology, Lockheed Martin is deeply involved in the Pentagon’s Distributed Common Ground System, or DCGS. On its website, Lockheed Martin describes DCGS as “a global, internet-like network where both military and national agencies have access to time-sensitive intelligence, surveillance, and reconnaissance data.”
Lockheed Martin was created during the 1990s through a merger of Lockheed’s aircraft division with Martin Marietta, Loral Defense, and the General Dynamics combat aircraft division. In the end, five huge firms were left standing: Lockheed Martin, Northrop Grumman, Raytheon, Boeing and General Dynamics. Lockheed Martin and other large defense contractors have snatched up the rest.
In 2004 and 2005 Lockheed Martin acquired the government IT unit of Affiliated Computer Services Inc., inheriting several contracts with defense intelligence agencies and Sytex, a $425 million Philadelphia-based company that held contracts with the Pentagon's Northern Command and the NSA/Army Intelligence and Security Command. By 2007 the company employed 52,000 IT specialists with security clearances, and intelligence made up nearly 40 percent of its annual business, company executives said.
One of Lockheed Martin’s most important intelligence-related acquisitions took place in the 1990s, when the conglomerate bought Betac Corporation. Betac was one of the companies the government hired during the late 1980s to provide communications technology for the secret Continuity of Government program the Reagan administration created to keep the U.S. government functioning in the event of a nuclear attack. Under a 1982 presidential directive, the outbreak of war could trigger the proclamation of martial law nationwide, giving the military the authority to use its domestic database to round up citizens and residents considered threats to national security. The Federal Emergency Management Agency (FEMA) and the Army were to carry out the emergency measures for domestic security.
To build the communications system that would allow this secret government to communicate, FEMA hired the Harris Corporation, an important Florida-based intelligence contractor; the CIA hired McDonnell-Douglas (this was before its merger with Boeing); and the Pentagon hired TRW, an important intelligence contractor that was acquired in 2002 by Northrop Grumman. The military’s contracting tasks were assigned to the Information Systems Command based at Fort Huachuca, Arizona, where the project was managed by Brig. Gen. Eugene Renzi, the deputy chief for operations at the base and the senior national program officer at the Army systems command.
One of the biggest winners was Betac Corporation, a consulting firm composed of former intelligence and communications specialists from the Pentagon. Betac was one of the largest government contractors of its day and, with TRW and Lockheed itself, dominated the intelligence contracting industry from the mid-1980s until the late 1990s. Its first project for the Continuity of Government plan was a sole-source contract to devise and maintain security for the system. Between 1983 and 1985, the contract expanded from $316,000 to nearly $3 million, and by 1988 Betac had multiple COG contracts worth $22 million. Betac was eventually sold to ACS Government Solutions Group and is now a unit of Lockheed Martin.
Here’s how Lockheed Martin describes its “National Intelligence Systems & Services” work on its website: “Every day, the men and women of the U.S. Intelligence Community stand guard at the gates of our national security, diligently working to stay one step ahead of those who would do us harm. They are supported by a sophisticated network of systems and sensors that collects, processes and distributes vital intelligence to the analysts, warfighters, and leaders who need it most. Lockheed Martin is proud to deliver a wide range of systems and services that support the Intelligence Community's mission of ensuring global security.”
In August 2008, Lockheed Martin won a $32 million contract from the NGA to provide “specialized geospatial training to analysts and officials across the Department of Defense and the Intelligence Community.” Under the contract, Lockheed Martin provides professional instructors to run classes and develop curricula for courses offered by the NGA College based in Washington, D.C., and St. Louis, Missouri. In April 2008, Lockheed Martin provided technical support and communications networks for a Cyber Defense Exercise war game conducted by the NSA.
Most of the sourcing for this profile came from Tim Shorrock, ''Spies for Hire: The Secret World of Intelligence Outsourcing'' (Simon & Schuster/2008). Other information came from the Lockheed Martin website and press releases.