
Stealth Boat the U.S. Government Won't Buy or Let Be Sold Abroad - JimmyAustin
http://www.bloomberg.com/news/articles/2016-10-19/the-feds-won-t-buy-this-19-million-stealth-boat-or-let-it-be-sold-abroad?utm_content=business&cmpid=socialflow-twitter-business&utm_campaign=socialflow-organic&utm_source=twitter&utm_medium=social
======
Animats
There are a few documented Government-suppressed inventions. One is
Airadar.[1] This was a radar unit for light aircraft. It had a conformal
antenna in the wing (the aircraft nose being occupied by the engine), phased-
array scanning with no moving parts, and was much lighter than moving-dish
radars. In 1973. The inventor came from a long career in avionics, and in
retirement, developed this. It worked fine, was installed in an airplane, and
was reviewed favorably in Flying Magazine.

This really bothered the USAF, because it was way ahead of military radars of
the time. So there was a patent secrecy order, and Airadar disappeared. It was
decades before such radars became common.

[1]
[https://books.google.com/books?id=NWzlTqj0gQ4C&pg=PA66](https://books.google.com/books?id=NWzlTqj0gQ4C&pg=PA66)

~~~
bdamm
That is noteworthy and repulsive. To think, the safety of the flying public
was sacrificed because of the military's glacial pace.

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cnvogel
Is it just me, or does $19M sound ridiculously low for building a prototype of
a military vessel?

Most larger yachts that are built for rich people seems to cost around this
ballpark, and for them I would expect that no new technology has to be
integrated from scratch, in to the core design (as in: motors, geometry of the
hull). Exceptionally ugly boats, like Venus built for the late Steve Jobs
claim to cost $100M!.

With a innovative new concept, I expect a lot of individual systems to be
prototyped, scrapped, reworked. Let alone the effort needed for designing this
thing. This is a startup with 20 People (17 of them now being layed off)
operating for several years building a SHIP.

Anyone having numbers for typical effort/money/time/headcount spent in
designing and building novel boats?

~~~
semi-extrinsic
Well, the cost to an employer of 20 qualified engineers working for 3 years
should be at least $10M. So you've spent >50% of that budget on just payroll +
employee overhead.

So we have $9M left. There's a pair of 2000 shp turboshaft engines, something
like the GE T700, costing around $2M total. Probably another $2M on drives and
supercavitating propellers. Then there's all sorts of other equipment like
radar, navigation, hydraulics etc. with $5M left. So I'm not sure it's
entirely unreasonable.

But probably they're reporting a cost that's representative of what these
would cost if someone went and ordered 10 of them.

~~~
rahrahrah
Sure, if you got everything right on first try.

------
dkopi
If you support export controls for security reasons, this is kind of
inevitable.

The government shouldn't be forced to buy any type of military technology
someone creates. But even if the government won't buy your tech, it still can
be dangerous in the hands of other countries.

One could argue that if the government is preventing you from selling your
tech abroad - there should be some sort of compensation for this. Others could
argue that's just the cost of being in the business of weapons manufacturing.

~~~
icebraining
There is a process for compensation:
[https://www.law.cornell.edu/uscode/text/35/183](https://www.law.cornell.edu/uscode/text/35/183)

According to the article, it simply rarely pays up; it's a shame they don't go
more into why.

~~~
pmorici
An inventor in that position doesn't have any negotiating power that's the
why.

~~~
smallnamespace
One possible reason is it's very hard to prove the market value of something
that you never sold.

You can say that your product is worth $1bn until you're blue in the face, but
there won't be any evidence of that without any buyers.

~~~
pmorici
I think it's more basic than that. The company has no BATNA (Best Alternative
To Negotiated Agreement).

------
tomohawk
This reminds me of the Sea Shadow:

[https://en.wikipedia.org/wiki/Sea_Shadow_(IX-529)](https://en.wikipedia.org/wiki/Sea_Shadow_\(IX-529\))

The rumor was that the Navy didn't like it because the crew size was too small
and no officer would want to be in charge of it as it would impact
promotability. Also, Lokheed was not a traditional Navy supplier.

Congress didn't like it because it was too cheap. The best way to secure
funding is to make it large and complex and involve as many congressional
districts as possible.

~~~
drivingmenuts
> The best way to secure funding is to make it large and complex and involve
> as many congressional districts as possible.

Proof that Congress, as a whole, is as corrupt as we usually think it is.

~~~
roywiggins
There's nothing inherently corrupt about trying to bring government jobs to
your district. I guess you could call it vote buying, but EVERYTHING can be
construed that way- lowering taxes, increasing expenditures, etc.

Perverse incentives, sure. A poor use of funds, yes. Corruption, not really.

~~~
toomanybeersies
It's no different to opposition to globalism on a national scale. The White
House wants to keep jobs in the USA, senators and representatives want to keep
those jobs in their state.

------
hudibras
“If the U.S. doesn’t want this, fine. But why not let us sell to friendly
nations? We’ve had so much interest from countries like Japan, Korea, Qatar.”

My guess is that he's blowing smoke on both the capabilities of the ship and
the interest from other countries.

~~~
gruez
How so?

~~~
Retric
Aircraft generally beat boats in an offensive role. The advantage boats have
is the amount of stuff they can take with them. This loses out on the benefits
of boats without any real clear benefit over aircraft.

------
syshum
>> For now, Sancoff has decided to stop filing patent applications altogether.
"We're afraid the government will come in and put more secrecy orders on us,"
he says.

I see this as a good thing.... IMO the protection patents provide are over
rated in the first place (unless your a patent troll) for companies that are
actually making something.

Of course it will not stop the State Dept from using ITAR to kill your
business.

>Senator Kelly Ayotte (R-N.H.) has weighed in on Sancoff’s behalf.“It doesn’t
seem right for the U.S. government

What does not seem right is the US government can issue secrecy orders in the
first place... That is what does not seem right. That seems like a clear 1st
amendment violation to me.

------
analognoise
Cavitating structures produce huge sonar returns, I think this boat's
'stealth' is greatly exaggerated.

~~~
danielmorozoff
Exactly - great you can't see it on radar, but you can hear it from 50km away.

I guess anti-air applications you can imagine this should be fine.

~~~
analognoise
Helicopters can drop sonobouys.

Also, after watching the video, it doesn't even look like it presents a closed
Faraday volume through the windshield (there's usually a wire mesh with a
specific transimpedance measured with conformal antennas). It looks like
somebody made an angular catamaran, slapped "stealth" on it, and is surprised
they don't get an exemption as an arms manufacturer and that the Navy isn't
interested in their design.

LO is hard work - the compute time and LO stack up costs way more than the 15
million. And did this company take a scale model and do a full LO radar test
out to 40GHz? Did they do field trials?

Some people actually DO that work, and it's hard and expensive. You can't just
slap 'stealth' on things. I mean even the coating lifetime in production
volumes in a sea-salt atmosphere is, by itself, a serious problem. Just...
Ugh.

------
jfoutz
Cynical me says why not sell it to Blackwater or Xi or whatever they call
themselves today? Heck, get in touch with a drug cartel, have them set up a US
corporation to buy the thing and walk away.

Alternatively, leave the boat and move to one of those countries and set up
shop there.

I think the real lesson to be learned, never do spec work.

~~~
jeff_petersen
> Heck, get in touch with a drug cartel, have them set up a US corporation to
> buy the thing and walk away.

> Alternatively, leave the boat and move to one of those countries and set up
> shop there.

While this might allow them to sell the boat to _somebody_ it might also get
them in trouble if they ever plan on coming back to the US.

------
slavik81
This is basically the fear of every defense company with any presence in the
United States. It's well known within the industry that you can get screwed
like this.

> The Navy and the U.S. Department of Justice declined to comment.

ITAR decisions are made by the State Department. Why not ask them?

------
Someone
It may be invisible to radar, but with all those bubbles and that in my eyes
enormous (for its size) wake (glanced from the video at
[http://www.bloomberg.com/news/articles/2014-08-21/juliet-
mar...](http://www.bloomberg.com/news/articles/2014-08-21/juliet-marines-
ghost-boat-will-be-hard-sell-to-u-dot-s-dot-navy)), how stealthy can this
thing be?

------
MrQuincle
If someone creates a dangerous army of robots, or a dangerous biological
weapon on American soil I hope your government destroys it.

Compensation sounds ridiculous.

~~~
toomanybeersies
It's a false equivalence. Especially since the stealth isn't the only
technology that they've developed, there's also the supercavitating pontoons
(I guess they're pontoons), which would have an application for civilian
watercraft as well.

~~~
MrQuincle
I'm not saying that it is as dangerous as the things I mention. It is the US
government that deems it too dangerous (forbidding it to be sold to other
nations).

In Holland there was a strain of bird flu created. I would have not been
opposed to the government stepping in.

Nuclear proliferation is another obvious example.

You state that there are civilian applications. I would say that that is
irrelevant. :-) I don't even know how to start addressing that argument. Is it
okay to develop potential dangerous tech as soon as you can earn money with it
through civilian applications? And why is it not possible to destroy the
stealth boat and keep the "supercavitating pontoons"? Is there some dark tech-
karma that requires a bomb made for every pill?

~~~
toomanybeersies
I think the problem is that the supercavitation technology is restricted (it
has applications for torpedoes).

------
chris_overseas
If this sort of treatment by the government isn't a reason to relocate to
another more welcoming country, I don't know what is.

~~~
gonzo41
Better make sure that country is a proper friend. If you take stealth tech to
somewhere like china you can expect a noose if you decide to come back.

------
stillworks
In theory, couldn't their market be commercial rather than just
defense/government ? Couldn't the propulsion system still be built for a non-
radar deflecting passenger/payload structure on the top ?

Or their goal from get go was to be able to become a defense
contractor/supplier ?

[EDIT]:Just saw the video again. The primary goal indeed is to cater to the
defense segment.

------
rxbudian
That's probably how the established companies that sell military equipment
keep their edge. Influence decision makers to not buy equipment from a company
who built a revolutionary equipment and strangle them with so much
restriction, then wait until it shriveled to almost nothing and desperate for
a buyer, buy the technology patents at a bargain and build another one under
their own names that will be approved by the same decision makers and bill
them exorbitant prices for each. I hope the ones that got laid off, get hired
quickly.

------
madaxe_again
There's a very simple explanation for their behaviour, and the "yes you can/no
you can't" approach.

They already have a contract for similar with one of the regulars - Northrop
or Lockheed or whoever. The project isn't going too well but they're not about
to concede defeat, although they came close a few years back. Once in
production they'll want US allies to buy from the same supplier for
interoperability and profitability reasons, so will block the sale of the
"wrong" product.

I mean, it's the only rational explanation - otherwise it'd be a no brainier
to buy his boat.

~~~
hudibras
In that case, it would be a no-brainer for the Big Defense Contractor to buy
him out...which leads me to believe that the BDC has a better version already
and doesn't need this guy's model. So he's in a tough situation where he's
designed something that's better* than anyone else's in the world, except for
his direct U.S. competition.

*According to this one guy, who owns the company, by the way.

~~~
etrevino
> In that case, it would be a no-brainer for the Big Defense Contractor to buy
> him out...which leads me to believe that the BDC has a better version
> already and doesn't need this guy's model. So he's in a tough situation
> where he's designed something that's better* than anyone else's in the
> world, except for his direct U.S. competition.

This is very likely a big part of this guy's problem. Either the tech isn't as
good as advertised or he's unwilling to sell. Maybe he doesn't think he'll get
fair value, I don't know. Now, one could argue that it's unfair that we have a
system that forces the little guy to sell out to the big guy, but that's a
different argument.

------
basicplus2
Looking at all the videos nobody needs to see a patent to build it anyway

~~~
achievingApathy
You're confusing patents with trade secrets. Most anything can be reverse
engineered, doesn't mean I am legally able to start reproducing and selling
it.

~~~
basicplus2
Given the article states...

"the government served Sancoff with secrecy orders, which meant he wasn’t
allowed to show the patents.....to anyone"

This pretty much makes the patents a trade secret now..

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MichaelBurge
He can't do anything about the existing IP. But in the future, is it worth
assigning the IP to a foreign holding corporation and applying for a foreign
patent in a country with patent-respecting treaties with the US?

They can't order an Icelandic company to do anything, even if it happens to
have American shareholders. And even if manufacturing is done in the US, the
most they could do is seize the ships, and there are stronger protections for
that.

~~~
icebraining
Wouldn't that kill their chances to sell it to the US Navy, which they were
hoping to do initially?

~~~
caf
The USMC was able to buy Harriers, I don't think a foreign supplier is out of
the question.

~~~
cstross
The USMC Harriers were, however, built under license by a US aviation company.
Ditto a bunch of other British-designed aircraft used by the USAF, such as the
English Electric Canberra aka Martin B-57 Canberra:

[https://en.wikipedia.org/wiki/English_Electric_Canberra](https://en.wikipedia.org/wiki/English_Electric_Canberra)

[https://en.wikipedia.org/wiki/Martin_B-57_Canberra](https://en.wikipedia.org/wiki/Martin_B-57_Canberra)

(This traffic went in both directions: for example the British Army's AH-64D
Apache Longbow gunships are built by Westland.)

------
crdb
Is there a video of this boat in real weather? That is, waves larger than the
boat [1]. How does it cope without capsizing? Do its systems still work? Is
propulsion retained if strong enough turbulence "breaks" the gas bubble around
the floaters?

[1] e.g.
[https://www.youtube.com/watch?v=_dVkeh7wUm4](https://www.youtube.com/watch?v=_dVkeh7wUm4)
\- the boat at the start is about the same size.

------
mungoid
I'm willing to bet its more because other defense contractors that have a
longer history with the government want them to buy their much more expensive
equipment than some new company that isn't 'in' with the decision makers. I'm
positive something this cheap would surely shake up the standard thats been
going on far too long.

------
nyolfen
an interesting conundrum: if you make something deemed too dangerous to be
sold abroad, is the government obligated to buy it from you?

~~~
sirmike_
Because it has effectively become the government's property. What else would
you call it? If they control where it goes, who can look at it, how many can
exist or be built. Those and many more are property rights. US Govt needs to
pay up seeing as this is a fully mature platform. If it was just some drawings
on paper then they wouldn't owe a dime.

~~~
hiharryhere
Say you make a new kind of drug, the government is allowed to regulate it and
prevent you from selling it. That doesn't oblige the government to compensate
you for making something dangerous.

~~~
tomohawk
If its dangerous, then it is not a drug.

EDIT: If its _only_ dangerous.

~~~
achievingApathy
Plenty of drugs can be dangerous if they are misused and not properly
regulated. You can grow poppies in your backyard, as long as you don't
know/expect to milk them for opium.

------
elcct
Make it autonomous and you get quite nice illegal goods transportation
machine.

------
transfire
Pentagon is notorious for steeling other people's inventions under secrecy
laws. They probably already have some big defense contractor building exact
replicas of his boat in secret right now.

------
tokai
Why would you ever use a boat for stealth? Wouldn't a submarine do a better
job in every situation? If speed is needed a plane could do the job faster
(and stealthier?) than a boat.

~~~
dsfyu404ed
Stealth != invisible.

Stealth means you show up on radar like a 15ft skiff (in the case of a ship)
or a seagull (in the case of aircraft)

~~~
trhway
>Stealth means you show up on radar like a 15ft skiff (in the case of a ship)
or a seagull (in the case of aircraft)

a seagull flying at Mach 1+ :) ... I know, i know, it is about distance you
can detect the "seagull" from, not about classification.

------
Kenji
Just take all documents, move to China or Russia and build a ton of these.
That'd make the US think twice about messing with inventors.

~~~
tomohawk
I wonder what would happen if they put all the specs on a private server in
the basement and some hacker broke in...

~~~
Kenji
Hahaha, I see what you did there. That kind of behaviour only works out for
the political class that is above the law.

------
njharman
Sounds like they gambled, build military tech without contract, and lost.

Now they want taxpayers to pay for their failed bet.

------
s_q_b
Drones are easier to sell.

------
xupybd
Why not move the company overseas?

------
microcolonel
Should've gone straight to SOFEX and offered it as a "commercial" platform.
USG only wants anything if it's built by Raytheon, GD, or Lockheed-Martin.

------
TheSpiceIsLife
I'm surprised someone hasn't yet come up with the "tech solution" to this
problem.

One way out of this for Sancoff is to have The Russians™ hack his computer
system and "steal" all his secrets, they'd have to pay in Bitcoin or that
other one that launched yesterday, what was it? Zcash.

Also, he could sell the rights to the movie in a couple of years. From his
Russian hideout.

