White Paper

Mercury's next generation defense electronic business model is a hybrid model. It combines the best innovation engines and investment strate- gies from the commercial electronics domain with efficient, scalable and affordable manufacturing and makes them suitable for defense applica- tions. With the infusion of embedded product and infrastructure security, trust and defense grade miniaturization and rugged packaging, Mercury has created an enterprise that meets today's defense electronics innova- tion and deployment requirements. In effect the next generation defense electronics business model is doing more with less, and doing so better and quicker. Mercury's next generation defense business model applies the best commercial practices of investing focused IRAD to solve anticipated future industry needs in domains such as embedded system security, dense packaging, greater reliability and processing power. We leverage the best commercial technologies, while building in trust, security, lon- gevity and military grade ruggedness. Unlike commercial equivalents, Mercury is a dedicated defense electronics manufacturer that uses de- fense industry processes, documentation, testing and support practices. As such, Mercury may be regarded as an innovative commercial com- pany and secure manufacturer that is focused on meeting the needs of a modern defense industry marketplace. Maintaining our defense electronics leadership is pivotal to our national defense. For the prime defense contractors, electronics leadership is also fundamental to winning and retaining more business. "Leading the race now depends on who can out-innovate fastest" - this requires com- bining innovative technology breakthroughs with efficient manufacturing for deployment at the speed of technology. The best world-class commercial manufacturers have capabilities that enable their customers to jump to the front of the deployment race through rapid, low-risk, low-cost of ownership manufacturing. These manufacturer capabilities enable their customers to focus on their true value - innovation. These capabilities are captured within Mercury's next generation defense electronics business model and similarly aid prime defense contractors to lead their deployment races while they remain innovation focused. Precise, repeatable product performance, delivered using proven tech- nology and low-risk processes, that scale from low, to high volume and that are offered with quick reaction capability and risk deferring fixed prices would differentiate any defense solution. Although an impressive list, it is not enough by itself for effective defense electronics production. Intel Xeon-SP powered open system blades (3U, 6U OpenVPX and AdvancedTCA) 3 Prime contractors require industry specific capabilities that are seldom seen within the commercial domain. Primes require built-in security and trust in both the product and the producers' infrastructure. They require custom RF and digital processing pre-integration in the same box, solu- tion miniaturization, defense grade ruggedness and longevity of supply/ support. None of these traits are naturally characteristic of even the best commercial contract manufacturer. A bigger concern is that commercial contractors are becoming more and more globalized, exposing them- selves to the risks of complex and intrinsically vulnerable supply chains. Vulnerabilities and comprises to these supply chains may be accidental, but increasingly they are not. OpenRFM modules are compatible with OpenVPX "The DoD is interested in solutions that enable the use of commercial foundries while ensuring critical defense technologies and intellectual property (IP) are trusted (con- fidence there is no malicious content), assured (verified function with no extra functions), and protected (prevention of unauthorized disclosure)." Broad Agency Announcement FA8650-18-S-1201, October 2017 Mercury's next generation defense electronics business model ad- dresses these requirement-gaps, while leveraging the best commercial IP and business practices to deliver secure pre-integrated RF and digital processing solutions for defense applications. Next generation defense electronics business model - Mercury's qualification For over three decades Mercury has designed and manufactured the most powerful, contemporary embedded defense processing solutions. Mercury pioneered an open system approach to building these systems, first with the creation of real-time switch fabrics (RACEway, RACE++ and Serial RapidIO) that ran on then industry de facto embedded processing open system architecture (VME). More recently, Mercury led the cre- ation and adoption of OpenVPX (ANSI/VITA 65-2010), which has become the follow-on and current de facto rugged embedded digital processing modular open architecture (MOSA) standard. "90%+ of respondents believe that business risk is increas- ing, with supply chain complexity being the largest con- cern, followed by cybersecurity, business model disruption and globalization." Ref - MIT 2015 Global risk survey

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