One of the big changes for military vendors in recent years has been the greater emphasis placed on acquisition of Commercial Off The Shelf (COTS) products by the Department of Defense (DoD). In the past, COTS constituted a few percent of all items purchased by the DoD. While the overall amount is still low, some weapon systems are composed by as much as 50% of COTS. What are the good, the bad and the ugly about COTS?
Good:
1) Cost: One of the main drivers for the acquisition of COTS has been the price. By definition, COTS products have no development cost, so, in theory, the DoD gets a cheaper item. Despite its behemoth budget, Defense still accounts for a minuscule part of the electronics market. So, by buying from the much larger commercial sector, DoD also benefits from economy of scale. Read more