That is up from the total at the end of March, when the unit claimed 25 projects for a total of $48.4 million — a significant increase that a DIUx official admitted means the group is “further along than we ever imagined.”

DIUx was formed in early 2015 by then-Secretary of Defense Ash Carter, but after a year of stagnation, relaunched in late May 2016 under the leadership of Raj Shah, a former U.S. Air Force F-16 pilot and special assistant in the Office of the Secretary of Defense who worked for a variety of Silicon Valley tech firms.

Shah has managed the office to greater success, to the point where DIUx has won support from both the Hill and leaders of the military services.

That doesn’t mean there haven’t been roadbumps along the way. For instance, Shah said in March that he expected to transition programs to military service earlier this year, a timeline that has now shifted. But overall, the group has managed to deliver to a level most had not expected, especially when it lost the patronage of Carter.

Or as Chris Kirchhoff, a managing partner with the group, put it to Defense News: “I think that we’ve all been surprised at how much progress we’ve made.”

Kirchhoff says DIUx was set up to prove a theory — that the Pentagon could develop closer ties with the tech sector by being located in technological hubs like Silicon Valley; Boston; and Austin, Texas. And now, “we’ve proven the theory.”

According to the most recent quarterly report for the group, DIUx has been able to award pilot contracts roughly three months after receiving responses to solicits. For each dollar that DIUx puts in, the “customer” — aka the service interested in the program — kicks in four or five dollars.

And because the Pentagon is not going to be able to fund these companies on their own, DIUx has focused on scouting out firms that have serious investors behind them. The group claims the private sector has invested roughly $1.8 billion in the 37 companies supported by DIUx. Notably, DIUx says seven of those companies “have been able to raise roughly $720 million in subsequent rounds of funding, partially due to their work with DoD.”

While it seems assured the group will continue to exist and be supported in the future, there are some questions about where it will live. Currently, DIUx directly reports to Secretary of Defense Jim Mattis, a holdover from the Carter days.

But under a new reorganization plan submitted by the Pentagon Aug. 1, DIUx will be folded into the new office of the undersecretary of research and engineering — a move that will see its reporting fall roughly four levels from where it is now.

Kirchhoff downplayed the shift, saying, “What we’re focused on is making sure we can accomplish our mission. As long as we can accomplish our mission, we’re excited.” But analysts have raised the concern that DIUx may find itself dragged away from innovative ways of doing business and into the more traditional defense acquisition system.

Speaking to reporters Aug. 2, Shanahan downplayed any potential issues: Shah is “just dynamite,” and that the goal is not for DIUx to be ”subsumed” in the new system but rather, to spread their capabilities and processes to the rest of the Under Secretary of Defense, Research and Engineering team.

The authorities for the Defense Innovation Unit Experimental (DIUx) and Strategic Capabilities Office (SCO) were approved by former Deputy Secretary of Defense Bob Work on July 14, just weeks before he retired from service.

The needs of those two organizations “can only be met by being able to hire the most technologically advanced and experience individuals who can work and communicate with their counterparts in industry and build new relationships with technology companies where the Department has experience challenges,” Work wrote in his memo announcing the changes.

The two offices are critical parts of a broader effort, spearheaded by former Defense Secretary Ash Carter, to have greater outreach to the commercial technology sector. DIUx is specifically charged with talking and working with the tech sector in Silicon Valley, Boston and Austin, while SCO is charged with taking existing technologies and developing new capabilities for their use.

Secretary of Defense Jim Mattis, who is visiting DIUx as part of a west coast swing, certainly appears to be supportive of the office, telling reporters Wednesday that “I enthusiastically embrace it, and I’m grateful that Secretary Carter had the foresight to put something in place to anchor the Department of Defense out there.”

The personnel authorities come in two forms. The first is Work renewing, for another 18 month term, language in Section 1105(b) of the FY17 National Defense Authorization Act (NDAA) which allows DIUx and SCO to hire staff for up to 18 months in a noncompetitive manner. The idea is that the government organizations will not be able to compete with the commercial tech sector for talent if they have to go through the usual process.

Second, Work ordered the department to draft a legislative proposal for inclusion in the 2018 NDAA that would give both groups the ability to rapidly hire for long-term positions. This was based on positions granted to DARPA, the Pentagon’s long-running future technology hub, in what Chris Kirchhoff, one of DIUx’s coordinating partners, said was a conscious effort to mirror the group’s success.

Kirchhoff notes that DARPA can hire people in as little time as one day, a “heck of an advantage” for DIUx to mirror given its competition with the commercial technology sector for talent. And while it may take “a couple months” before DIUx has its HR team staffed up and ready to hire at that rate, when that happens, it will be able to compete directly with the tech sector for talent.

Another authority Kirchhoff highlighted is the right to execute on contracts up to $5 million, particularly for operations and maintenance, without needing to go through the usual wringer of Pentagon procurement. In comparison, he notes, DIUx spent its first few months dealing with a $3,000 limit on its purchasing cards, with anything more needing to go through the main department’s purchasing system.

Like the new hiring capabilities, this authority comes with setting up a new contracting officer who will be located with the main DIUx office. The same is true for SCO, according to Work’s memo.

“We can let contracts much quicker. We often need to buy supplies in a hurry on the test range and you can’t wait six weeks for [the usual procurement process] to put in place to buy supplies, so we’re really excited,” Kirchhoff said.

Other authorities for the offices include the ability to publish advertisements, notices and proposals on their own, as well as authority to approve conference expenses for up to $500,000 without needing to go through traditional channels to get approved. Again, both of those are particularly vital for organizations that are outreaching to the tech sector, where new ideas and companies often pop up, develop and disappear in the time it might take the Pentagon to investigate them.

While much of the activity is focused on making it easier to attract outside talent, DIUx is also looking at ways to improve how it attracts internal talent — specifically from the uniformed military. As a result, DIUx is pushing to have permanently funded military positions count for the Joint Duty Assignment List, a key factor for military officers looking to advance in their careers.

“We’re a new organization; we often receive incredibly talented members from services who are on a particular career track with milestones they must hit,” Kirchhoff explained. “We’re delighted that we’re in the process of having our military billets be declared joint; … we are, of course, a deeply joint organization working on a deeply joint mission set, so it’s very logical.”

All of the authorities, minus the one that requires support in the FY18 NDAA, are now in place. Given the vocal support from the Hill for both DIUx and SCO, it is likely such language will be included in the final version of the defense bill.

Raytheon was first selected as the provider for 3DELRR in October 2014, but Northrop and Lockheed quickly lodged protests over the decision with the Government Accountability Office (GAO). Days before the protest window was to run out, the Air Force voluntarily announced it would re-evaluate the contract award, a move seen as a sign that the service expected the GAO to side with one of the protesting companies.

As a result, Raytheon lodged a suit against the service, one which was ultimately rejected by a U.S. court. The Air Force then relaunched the competition. The 3DELRR program will replace the service’s aging TPS-75 expeditionary radar system, which officials have warned will not be able to track future capabilities being designed by potential foes. The new systems are scheduled to be active in 2028.

At stake with the contract was not just the right to produce systems for the Air Force, but a potential stranglehold on the broader ground-based radar market. The U.S. Marine Corps has also explored the option of using the 3DELRR winner to replace its AN/TPS-59 system.

A Raytheon spokesman said the company was “pleased” and “eager to move forward” on the contract.

Although Lockheed did not win, they appear to have a fan of their offering — in 2014, a Chinese radar bearing heavy similarity to the Lockheed design appeared at a trade show. The company was famously hacked in 2009, with consensus that the Chinese government was behind it.

Raytheon first entered into an agreement with the Defense Advanced Research Projects Agency in 1981 to develop AFATDS and received its first contract in 1984. AFATDS was approved for fielding in 1996.

According to the Army’s statement, AFATDS has supported operations in Desert Storm and Iraqi Freedom.

AFATDS is 100 percent fielded with more than 4,000 systems. The newest version is expected to be fielded in fiscal year 2020.

Raytheon said it couldn’t provide specifics on award values over the course of the program, but sources say it was a lucrative endeavor for the company. Raytheon successfully fielded 13 versions since 1984.

The company would not disclose if it planned to file a protest with the Government Accountability Office (GAO), but, a spokesman told Defense News on Wednesday, “Our proposed AFATDS solution leverages our extensive experience and proven performance across a broad spectrum of Command and Control programs. We plan to attend the post-award debrief and welcome the US Army’s feedback.”

While the Army would not respond to follow-up questions regarding competition details, following the release of its statement, other competitors included General Dynamics Mission Systems and Northrop Grumman, Defense News has learned.

GD’s response Wednesday was similar to Raytheon’s. A company spokesman said GD was “disappointed” by the decision on the AFATDS competition and also “look[s] forward to receiving a debrief later this week from the Army.”

The service said in its statement, by choosing Leidos it “used a best value, trade-off source selection via a full and open competitive strategy. Based on the market research results, the government pursued a full and open competition to implement the most innovative industry approach possible to address AFATDS 7.0 requirements while reducing risk and continuing to implement new capabilities.”

Rockwell Collins on Monday is introducing Coalescence at the Interservice/Industry Training, Simulation and Education Conference (I/ITSEC) in Orlando, Florida. Two demos will be showcased at the company’s booth: an F/A-18 “ready room” where pilots prepare for a flight from an aircraft carrier, and a ship bridge simulation.

“The advantage would be to have a very small footprint on an aircraft carrier” that would allow F/A-18 pilots at sea to prepare for and practice missions before they step into the cockpit and execute, Gibbs said.

“It would be a cost-reduced, highly improved fidelity environment to what exists today,” he said. “What that would look like today is you might be in that same cockpit looking at a computer monitor, not really immersed in your aircraft.”

The system can be configured several ways. One method is to mate an Oculus Rift virtual reality headset with existing simulation equipment, and pipe data from the simulator into the headset. At I/ITSEC, Rockwell Collins is showing how Coalescence works with an Oculus Rift and typical military hardware not hooked up to a simulator — items like a cockpit, displays and controls — which are integrated with the company’s core simulation architecture and a synthetic environment.

According to Gibbs, the “secret sauce” is how the software figures out what elements from the real world to bring into the virtual world and how to solve latency issues that may arise. For instance, in a situation where a person is holding a ball and then throws it to the user, the user needs to be able to see that ball and catch it without the simulated visuals lagging behind.

The technology isn’t quite ready for full-flight simulators yet, but it’s quickly approaching the resolution and fidelity needed, Gibbs said.

” Moore’s lawis working here pretty hard, so it won’t be long. It will be a couple of years for sure,” he said, referring to the co-founder of Intel, Gordon Moore, who anticipated that computing would increase in power and decrease in relative cost at an exponential pace.

Rockwell Collins plans to make Coalescence available in 2017, but the company is still looking for its first customer. Gibbs believes it could be adapted for a variety of missions including joint tactical air control, dismounted soldier, driver training and even some rotary-wing applications. But although the company is considering proposing it for several programs of record, it has already run into a problem — the technology has outpaced the currently defined requirements.

Gibbs summarized his argument to the US military as: “Let’s identify a set of requirements that satisfies the training needs assessment for the program, and enable those to be satisfied by different and new technology.”

One selling point could be the cost. The company is still solidifying its cost model, but Gibbs said it will be “orders of magnitude less” than the $6 million to $10 million price tag of most flight simulators.

Kendall did not elaborate on the next location, but Austin, Texas, is a likelihood. The city was one of two innovation hubs that Secretary of Defense Ash Carter visited during a spring trip. The other hub visited on that trip was Boston, Massachusetts, which since became home to the second DIUx office.

REGISTER NOW: CyberCon is coming November 16.Announced in April 2015, DIUx was originally conceived as an office in Silicon Valley that would be able to bring outside technical expertise back to the Pentagon. However, the group was slow to deliver results, and in May of this year Carter announced “DIUx 2.0,” which included bringing in new leadership and launching the Boston office.

If DIUx were to expand to a fourth location before the end of the year, another likely move would be to base the office near Washington, D.C. Northern Virginia has become a tech hub in its own right, and having an office close to the Pentagon could pay off politically as the office attempts to survive under a new administration.