Some of those have crystallized and be found to be not true to have been fabricated or grossly exaggerated. I think the ghost of kiev or the russia only seen in their conscripts theories, but others have crystallized, surprised the world and taught us some genuine lessons. And after asking people in a poll what topic of those lessons they wanted to cover, one thing that has emerged is what weve discovered about unmanned uh vehicles and drones in ukraine. The revolution or evolution in warfare represented by the success of systems ranging from the famous barracktarones of ukraine from turkey, but also everything down to lloyd, ammunitions commercial drones by both sides, all of which generally have proven more effective than most commentators, seem to have expected. What im going to do today is im going to put my classic appropriations. Investment lens over this whole thing, im going to give you a background to unmanned systems that leading up to this wall investments whats, the whats, the general path of unmanned aerial vehicles being android administrations been leading up to this conflict. Im going to examine the use of unmanned systems in ukraine, including russian use people have complained on some of my videos that i am apparently pro ukraine propaganda. I will be covering the russian deployment of unmanned systems and also uh lawyer munitions in this conflict to a degree as well, because its part of the lesson that were learning we cant just cover the ukrainians.

Then im going to pivot im going to look at the economics of unmanned systems because theres some terrifying lessons out of the ukraine conflict to date, when you consider them in the context of how cheap and affordable some of these systems are and then finally, im going To look at what that means for the opportunity for all nations around the world, but particularly middle sized powers to potentially disrupt existing defense planning because of the revolution and affairs that these unmanned systems are driving. But first uh here are my contentions on paper. First of all, this is not a baractas thronk propaganda piece. Yes, the tb2 has done very well, yes were going to talk about it, but i am not chilling for the turkish drone industry in this presentation im going to try and be fair minded. I use it because its an example where we have good amounts of video evidence and it makes the economic argument well. My second contention is that unmanned systems are proliferating at almost every level of the complexity spectrum, everything from hyper, advanced, very expensive, long range surveillance, unmanned aerial vehicles right down to people using things that are basically knock offs of commercial quad rotors. In order to do small operations at the squad or even individual level, im then contending that systems are proving effective enough in ukraine to raise serious questions on future spending. Basically, what im saying is, even if were not sure, exactly how effective drones are in ukraine, its clear that theyre at least effective enough that their various advantages over man systems means that countries around the world really need to look at their spending priorities and, if theyre Ready for the revolution in military affairs that these systems is driving im going to contend, the cost advantage of unmanned system runs a lot deeper than it first appears its a lot more complex than just a biodicta cost, 2 million and a fast jet costs 30 to 80 million and thus im going to contend that theres a huge opportunity for asymmetric return on investment disruption by small players.

Basically that for a little bit of investment, you can get a lot of additional combat power in certain contexts that might make it easier for smaller powers to stand up to larger ones. Lets get started, proliferation, unmanned systems so whos using drones, because drones have really entered the public consciousness and theyve done so, particularly during the global war on terror era, where american drone strikes became famous the world over images of things like the predator or the mq 9. Reaper became synonymous with the war on terror, coupled with deployments of more expensive and famous systems like global hawk as um reconnaissance assets, but at the same time, they arent really driving a huge share of overall spending. Ive pulled there from the 2020 budget requests for the usa air force for aircraft and related systems. Youve got that in the top right 52.4 billion dollars in appropriations for aircraft and related systems, of which 1.6 billion goes to unmanned aerial vehicles. Theres 20.4 for combat aircraft 5.8 for cargo aircraft, theres 1.4 for support aircraft theres a lot of there for technology and development, some of which are a lot of which may go into unmanned systems, but in terms of actual purchases of unmanned systems, 1.6 billion, not a Dominant share so theres a lot of room for these things to expand if theyre, given priority um. These systems have, however, become available to more and more actors. What youre, seeing is a lot more middle ranking powers, add drones to their military repertoire.

Turkey is a famous example: israel powers the world over, but there have always been questions over the capabilities of this system. People have always asked the question of how these systems cheap and cheerful as they are, would actually stand up in a in a quote: unquote: a real war um its natural for defense industries, uh for militaries themselves for politicians to have a bias towards caution. They know their existing systems, work or classes of systems work, so theyre, not exactly quick to go all in on new ideas and systems, and there was a great degree of caution theres, an article there which, unfortunately, the titles cut off. But there was a forbes article on the baraktar drones in ukraine and reports on the purchase of the 20 original tb2s and basically goes on to contend that they wouldnt really matter in a war with russia because of how presumably, how slow and vulnerable the system is. There was this belief that a lot of these systems would be chewed up by any competent air defense system, and that argument has been used to dismiss uh evidence and experience from things like the corner, karabakh war, where armenia was absolutely slapped around by azerbaijani drones. From syria, everyone there was a great degree of skepticism over whether these cheap unmanned systems would actually be effective if put to a serious test. But now we have actual combat data from ukraine, conflict with a major military power like russia and a relatively a relatively together military, like ukraine, um after many many years of western supports and the immense efforts of the ukrainians themselves to modernize and what were seeing now.

These drones are in action. Well lets look at the tb2 as an example, so the tb2, the biarchtar, possibly the most famous drone to come out of the conflict. Far from the only one thats being used, however, its a medium altitude, high endurance, uav, it uses little miniature anti tank missiles, so miniaturized ordnance, which again brings the cost down and also means that it doesnt need a particularly high payload in order to carry multiple weapon Systems, it has proved itself in past conflicts. Like i said, this thing was the grim reaper of armenian armor. During the war between azerbaijan and armenia. You can go to oryx and see the visually confirmed losses for dozens upon dozens upon dozens of t 72s that were slain by this thing during those conflicts. But, as i said before, like other systems, there was a reservation about it: going up against kate blair defense, its a very cheap system, its slow and in a lot of the commentary. If you read the hot takes or listen to analyst podcasts or things like that, youll notice, a lot of chauvinism from individuals in the west, about the capabilities of systems like the tb2 turkish junk was one term. I was one term i heard another great one. Was someone describing it as sheet meta sheet metal and a lawnmower engine which does a tremendous disservice, um to a multi million dollar weapon system, but anyway thats? The attitude that prevailed about this system and in ukraine? Theyve gone into action and theyve emerged as unexpected heroes of ukraines ground attack capability um, where the operations of the ukrainian air force seem to have been partly suppressed, or at least shrouded in secrecy.

Um tb2 footage of the drone systems, literally striking russian air defense systems. Um made it out relatively quickly and thus emerged as a near instant meme. Uh people were laughing because these these cheap and cheerful drones were destroying hypothetically um state of the art, very capable air defense systems that cause nato to uh to sweat for a little while um. That also cost a lot more than the drones themselves and in the the first days and weeks there was a lot of there was a lot of dismissal feeling this cant possibly go on. Maybe the crews just didnt have the systems activated, maybe the russians werent prepared for the drone strikes and they were being caught off guard um, but uh they keep working um seriously. They keep blowing things up, theyve blown up fuel trains, theyve blown up, lots and lots of air defense systems command posts. Um. If you go to the source i provided in my previous video on the uh russia conscripts send in the the wheat troops. First, myth um: you can see a specific page dedicated to just confirmed uh images and videos of tar strikes on ground targets, and this started to cause people to ask serious questions. I.E are the drones actually that effective, um i mean theres. A lot of confirmed kills out there. Your your lawn mower engine with sheet metal is out there hunting relatively advanced in some cases, air defense systems like the panzer or modernized bucks, and tours just think about the irony of that.

For a moment, an aerial system is out there hunting sands. Now, yes, i know suppression of enemy, air defenses is a thing with air launched, harms and aircraft, but this is a a cheap uh, a cheap drone made by a second or a third tier military power. Like turkey, no disrespect to turkey theyre just theyre, not a military superpower so far as their military industry goes and its out there taking out boers, tucks and pancettas. I promise well flip this around and look at what the russian deployment of unmanned systems and lawyer munitions has been in a bit. The results when you look at them quantitatively are pretty scary, even if you make the most generous assumptions against the tb2, so we have visually confirmed. Just visually confirmed just look at the russian losses there, because that also includes armenian and whatnot and syrian destruction from the syrian war and from the nagorno karabakh war. So the russian losses are the tours the bucks, the panzer um, so five buck, m2s, two back in ones: a tour m2, a tour m1 and a panzer s1, even if thats all they destroyed. That is, ukraine has released a hundred percent of its bairakhtar footage. This is the only kills that the birkhau has made, and i know thats not true, because there are kills in other systems categories. The systems that they are destroying are extremely expensive. High tech systems tours are about 25 million. I believe pansies, like 15 million, is the figures ive used in my previous presentations now.

In return for all of this, we have visual confirmation of one destroyed tb2 one now russia has claimed to have shot down. Basically, the entire ukraine inventory, but lets just say for a moment that instead of the one confirm loss, we break our own rule about owner using visual confirmation, and we assume the entire ukrainian initial inventory. 20 tb2s were all shot down in exchange for just these air defense systems. The cost trade ratio is well in favor of the tb2s. These systems are far more expensive and hypothetically far more capable than the 20 tb2s that were assuming were destroyed. Um in this example, in order to destroy these systems, so even at the most generous stretch, the tb2 has been an immensely cost effective system. Its basically paper beat scissors. An aircraft is absolutely styling on a relatively complex air defense system and russian air defense is reputed to be no joke and the tb2 is just one of the many many many systems in use and weve seen them across the whole range of complexity. Weve seen target drones used as decoys. This is a play on what they did in the counterback war, where they sent in drone biplanes in order to try and um cause air defenses to turn on their radar, so they could be suppressed or destroyed, um or bait missiles, weve seen micro and civilian drones. Weve seen ukrainians with their cell phones and little quad, rotors um out there doing little sneak and peak jobs with their little quadrotors um, calling in artillery spotting shell fire doing little squad level.

Tactical reconnaissance work using just these little drones and even dropping improvised munitions. Weve seen loiter munitions being used, the russians have deployed their uh um suicide drones, slash lloyd, ammunitions. Ukraine is getting switchblade, lloyd, ammunitions lots and lots of reconnaissance drones lans from russia and equivalents from ukraine in use so giving eyes in the sky in the form of unmanned platforms. So you dont, lose pilots doing recon work, weve, seen them being used for artillery correction. Weve seen them being used for strike duties, visually seen them being used for all of these, and, as i said, russia has gained some success in using it too. Weve got evidence that theyre deploying their orlans and their ailerons and the other reconnaissance drones that they have available to them. Weve got one example of a captured drone that was potentially being used to bait ukrainian air defenses um weve, seen uh kubbla, looting, munitions, thats, a thats, a kalashnikov, lloyd ammunition, ill talk about lloyd ammunitions a bit later. A few have been basically captured after they. They failed to detonate, but weve seen some cases at least one case ive visually seen where it is being used and the impact is being observed by another drone. Russians have used small small drones to film and in cooperation with their artillery using guided shells. So the cosmopol round this is a guided artillery shell being used. It seems in close cooperation with drones. In some cases, theyve used air defense, decoys, theyve used small recon drones at a local level, the orlan, which is the most lost category there you see theyve lost five orlan 10 reconnaissance uavs, but the all arms like a 100 000 platform, the kobb bla is cheaper.

So when youre talking about a hundred thousand dollars flat, um that that things probably cheaper than a javelin depending on what block of javelin and what export partner and what price theyre charging um theyre, not expensive systems at that close. At that point, theyre less. You should think of them less as aircraft and more is just ordinance and its likely that were going to see more of them. So i wanted to include this to say. Yes, the russians are using some of this stuff too, not as as famously and potentially not as extensively as the tb2. We cant conclude that just that we have far more visual evidence of the tbts being used, but we do have some evidence that russians are deploying these systems as well and in the cases weve seen deploying them with some levels of success. So, based on what weve seen, why would i conclude that these systems have been relatively effective? Well, weve got to triangulate from a couple of points. The first is the the visual confirm lost data. We have visual confirmations for tb2 kills um. We have video evidence of um those destructions taking place, which means weve got proof that theyre getting at least some kills. The other point is if we assume that people with limited resources are rational, theyre, going to use their limited resources on things that help and one of the things that ukraine has been spending a lot of the donations and other resources it has on is sourcing additional Drones right down to small civilian quad, quad quadcopters, um sourcing uh.

I think there was a tweet there. They bought 500 quadcopters taiwans donating quadcopters, or some taiwanese companies are doing so theyre actively trying to source more of these things, which you have to imagine with their in the situation theyre in where youre actively being invaded and your resources limited, you probably wouldnt, be seeking Out more of a system that isnt helping theyve requested them from western powers, in particular the switchblade, lloyd ammunitions. We dont know if theyve requested more other sorts of drones. Weve also seen videos of people crossing the border, giving donations and what are they taking with them? Theyre, taking boxes of commercial drones with them to hand over to the ukrainian armed forces, so plenty of visual evidence of them being used and plenty of visual evidence of them being effective and also the ukrainians themselves requesting additional supplies of them. The counterpoint to this is counter measures. How effective are drone countermeasures that are being used in ukraine and is it likely that they ramp up, and this is both in the hard and soft kill categories? Soft kill is like when you jam a drone, so it goes haywire because its got no guidance and it just flies off harmlessly into the distance and crashes somewhere. Meanwhile, a hard kill is you you blow it up. You use a shell use. A missile use a proximity if you use a kinetic impactor from another drone where you fly a drone into another drone, a mechanism to basically pull a kinetic kill on the actual drone itself, and this countermeasures point really does deserve its own discussion because its the biggest Reason that people were dismissing the the figures out of the nagorno karabakh war and um syria before we got into the ukraine conflict, the contention, as i said, was against an actual army with good air defenses.

These things will stand no chance like against an actual army. They will be destroyed um. The argument was: drones have not faced quality air defenses now for those who are students of history uh, this might sound awfully like uh european armies not really dawning on how effective or dangerous things like machine guns, uh and rapid fire artillery would be leading up to The first world war, by dismissing evidence from other conflicts, because oh well, it wasnt like a real war between two major european armies. They kind of dismissed a lot of evidence that they were seeing from other conflicts as uh atypical and that things would be more business. As usual, if two major powers in europe ever fought spoiler alert, they werent those weapon systems were genuinely terrifying and they changed the way war was fought anyway. This school of thought that says drones will be eaten up and destroyed by a competent air. Defense says: well: okay, maybe russian air defense is just being really incompetent here. Maybe the tb2 is thriving, because russian superiority fighters and surf square missiles and air defense cannot get their act together. But that raises the question. Then why are all the ukrainian aircraft being shot down? Not all of them, but certainly the ukrainian air force its larger platforms, its mig 29s, its su 27 su 25s um theyve lost 12. theyve, only lost eight uavs one. Only one of them was a baird akhtar. A lot of them were these smaller reconnaissance uavs.

All these really old, 2141 reconnaissance uavs from the soviet era. The russian air defense system is clearly good enough that the ukrainian air force is flying a relatively limited number of sorties theyre flying sorties, but a relatively limited number of reported sorties even by western sources, and you think western sources would want to pump up the number Of ukrainian sorties theyre, even there admitting that the number is relatively low and we have visually confirmed losses on 12 ukrainian aircraft. Now, yes, the aircraft in question are old, but please, i beg you. Dont, engage in moving the goal posts again, not every plane out. There is an f 35 in clean configuration with massive stealth systems, a lot of what you have to build a military or a lot of what a lot of nations have to plan to face in terms of opposing military forces are systems that are a little bit Old that are a little bit janky that are a little bit long in tooth their older airframes, even with modernized suites. So you have to be you: cant dismiss the entire um russian air defense system by ignoring all the aircraft, all the ukrainian aircraft thats either shot down or suppressed. At least i dont think you can do so fairly. I would based on this. I would conclude that russian air defenses in ukraine were not optimal, clearly are not toothless, and yet the drones have continued to do their job regardless.

So what does that prove? It doesnt prove exactly how effective these systems are. Theres a huge uncertainty range we dont know. If we have seen every single kill by a bayard and were massively underestimating their losses or if the drones have destroyed ten times as many things and theyve only lost the one thats visually sighted theres, this huge uncertainty range and even more with the less famous and More unknown systems we dont know just how effective um little quadrotor guided artillery spotting is um. We know its being used, but its going to take a long time for us to pass how effective this stuff actually is. So analysis is going to be needed on that point and its going to be needed on counters and the probabilities around that. How likely is it that people can improve their game on drone counters? How good are the counters coming down the track? How good are the counters to those counters that are being implemented for the drones? Remember that during the long fighting the donbass, there was a period of time where ukrainian drone operators couldnt operate effectively, because russian jamming and hijacking was getting the better of them. Then they learned how to counter those jamming and hijacking attempts. So you need to understand that before you understand what the the long term prospect is in terms of the exact efficiency rate of these systems, but it does give us two things. It provides a soft flaw on efficacy.

We know that the tb2s have eliminated at least as much as we have seen them eliminate. We know that the russian stuff has done at least as much damage as we have physically seen it do, and we can make some reasonable assumptions around other examples. It also allows us to derive a number of conclusions at varying confidence levels. What i mean by all that gobbledygook right there, what i mean is we can make some reasonable guesses based on the hard visual evidence we have available to us that about how effective these systems are things like based on the fact we see the ukrainians asking for The drones and using the drones, the drones are probably not worthless; they probably have some utility to them, and this is a this is where i start to pivot, because this is where the the evidence base provided by the ukraine conflict starts. Slipping into the decision making. The economics, the stuff that i love talking about what ukraine has proved, is that these systems have at least a certain level of efficacy that they can be used against relatively good air defense systems. If your standard is um, can it penetrate um, a multi, layered, u.s standard air defense around a critical strategic site, thats thats one level, but what were seeing here is that for battlefield use against what we considered a near peer opponent. They seem to be reasonably or even highly effective and thats a problem if youre an opponent of expenditure on these kind of systems, because economically, they have huge advantages over manned systems, and here im going to focus mostly on um drones that are being operated.

Basically, in the sense that tb2 is being used, a short to medium range, ground attack platform, basically um and economics does matter it matters because of the old guns and butter debate. Most nations only have so much to spend on their armed forces, because every dollar you spend on your own forces is a dollar that youre not spending on feeding people, clothing, people sending them to school, giving them health care or investing in railways and infrastructure for future Economic growth, um every dollar does matter if one plane costs 50 million and another costs 25 million, then it doesnt matter that 50 million dollar system is 10 better. Maybe the 225s are a better deal and if you look at systems in this area, theres a lot of cost to consider when you decide where you should be putting your cash, how efficient inverted commas the system actually is its not just how much the system costs To buy its, how much it costs to maintain the cost of getting a pilot to fly it the infrastructure around it, the politics around it. So what ive thrown up there is estimates from the the usgao government accountability office on the cost of operating uh per aircraft. Um, each of the usafs and certain platforms of the usaf, the navy and the marine corps, and they can be huge um. The spirits are obviously up there at the top, because theyre famously finicky specialized coverings or you understand why its expensive 62.

96 million dollars not to buy the system but to keep it in service and operated each year down to two and a half million dollars for an Apache, so when youre looking at a raptor, yes uh, you buy the raptor for 60 80, 100 million, whatever the cost may be in any given year or depending on whether you include r d costs or what version of the cut you use, but then youre spending 22.2: 02 million to keep it in service every year, with the slight majority of that being operations and support and the other half the other, a bit less than half being maintenance, um, youll notice, other platforms tend to slant more towards operating and support and less towards Maintenance um, the raptor, is a bit finicky in the maintenance sense um anyway, the costs are there. If you want to review them. The point: is these systems are expensive to keep flying so lets break these costs down in turn, why a man system so expensive? Why do why do unmanned systems absolutely um that dominate in this in this respect, um? Firstly, just the platform cost initial acquisition costs usually far higher for man. Platforms were not talking about global hawk here, which are those giant stratosphere flying high altitude, reconnaissance drones and its also an emerging development, a lot of drones in their early development, the ones that grew famous in the war on terror were actually quite expensive. Um mq 9 reapers uh 40, mil plus theyre, expensive platforms, global hawks, very expensive, but if youre looking at ones that can be used in the ground attack role and with systems that can actually do what were seeing the drone, the um, the tb2 is doing um.

You might be looking at anywhere from one to 60 times the cost to get a manned platform thats doing the job. The tb2 is doing, depending on what sort of aircraft youre using to run right. Do that particular task and what ground attack drone youre using so tb2 is the cheaper end of the spectrum. If youre using an mq 9 repay, you can probably get a cheap ground attack. Aircraft thats actually cheaper than an mq 9 to do ground attack duty, but, generally speaking, the cost advantages here. Favor favor the drones at the extreme end of this spectrum, smaller borderline off the shelf drones can actually be cheaper than the air defense weapons that youre using to shoot them down famously. This is the case if you look at the attack on saudi oil refineries by relatively cheap drones, where theyre shooting down cheap ass drones with patriot missiles. The attacking drones are far cheaper than the ordinance thats being used to attack the target, but, as a general rule outside of all these extreme examples, um the unmanned system is cheaper, but also generally has less capability in some respects on most missions, its uh by comparison, Its usually slower there may be range issues. There may be payload issues, theres a lot of advantages for fast jets in a lot of performance areas, but then you get into more cost issues. Maintenance buying a plane is just the start of the violence it will inflict on your bottom line.

If you are a person, if youre a relatively wealth person and you buy a pool, this is what i imagine the equivalent would be. It seems like a bright idea at the time until you start having to maintain the damn thing now, depending on the platform. Keeping an aircraft flying is expensive. U.S air force rates range from 6 000 to 35 000 plus per flying hour. That adds up quickly as simple platforms. Drone upkeeps tend to be far lower and also they require fewer flying hours for a reason well get into in a minute um, so maintaining something like a tb2 or an extreme example. Maintaining something like a borderline commercial drone, reloading munition now, those those at the extreme end those things dont require any maintenance. You keep them on the shelf until you fire them off the the maintenance cost. The upkeep is just far lower and also you can be a little a little bit braver with maintenance standards when youre not endangering the life of the pilot. Speaking at the pilot uh train parts are among the most expensive items. Any military can develop or maintain ive. Seen u.s air force estimates for about six million dollars to train an a10 pilot australian national audit office 2004 said it cost about 15.4 million aussie dollars to train a hornet pilot, and you convert that to american dollars you to cut about 30 off, but still those Are high initial training costs and then theres about 200 hours every year of flying time, just to keep proficient in the basic combat mission sense and remember those per uh flying hour rates that we just discussed.

You want to get a guy doing 100 or even 200 hours in an f 35 every year or in a raptor. Its the costs are going to run up extremely quickly. You can use simulators for some stuff, but it the hours they actually spend in the airframe are expensive by comparison. Drone parts are cheaper to train and and heres the big, and if the platform goes down, you dont lose them if a drone pilot uh, if a if a biodog car pilot loses his drone after say, striking a russian convoy um. Okay, tomorrow hes flying a new by rakhtar, but if tom cruise over here is flying ground attack and he goes down um and hes a pow, you have lost your investment and you have lost the capability represented by that pilot. That has political value that has economic value, that has military utility and as simple as as it is to state and as obvious it might seem its an important point. Pilots are expensive, you dont want to lose them and you dont lose them when youre flying drones, and this is a good point for a side note. Um life is not cheap. I thought about putting this slide in the other one about the the russian cannon fodder idea. Um but im putting it in here, because saving the life of the pilot is is an important point and not putting lives in danger when using your weapon systems is an important point.

Um losing a person is a tragedy with a really really long tail um, both in the the principle perspective of you know. Human life is inherently valuable, but also just from a cold economic perspective. By the time someone turns 18, their nation has spent 18 years investing them. You fed them clothed them, educated them for 18 years and they probably havent given much back during that time in terms of economic production, they go to their military service and, most after leaving the military will go back to work some, you know maybe unemployed or whatnot, But most will go back, theyll get jobs, theyll generate gdp, theyll pay taxes and then, even after they retire at age ages in their 60s or 70s, depending on your culture, but i think no pretty universally most will go on to provide unpaid services. Grandparents will look after children or help support wider families and whatnot when you lose a person youre not just losing um youre, not just losing a pilot who costs six million dollars to train youre, losing every contribution that person will make to your nation for the rest Of what their life would have been um the children that will never been born the jobs that will never be done, the support for others that will never be provided. Um the death of an 18 or 19 or mid 20s year old can snowball into really significant economic and social cost. Now the cost just has a really long tail its hidden.

So no most modern nations dont have blood to spare. They dont have people to spare. If i can spend a million dollars to use a million dollars worth of technology instead of losing a conscript, then that is an entirely rational, not only human decision, but economic decision and its something that weighs heavily in favor of unmanned systems, where those systems can be Used next points, infrastructure, theres, an entire support and logistics system that fits around aircraft. This is complex if youve ever seen an airport youll know what im talking about military air bases are another thing altogether note: americans most other countries, dont have the equivalent of like air national guard units at their air bases. So we dont get to see f 15s. When we fly into airports, drones tend to again it depends on the platform. Some are very finicky, some are not, but the cheaper stuff is usually more tolerant of where you base it. Chugs a lot less gas flies from worse fields and has a much smaller, logistic and support star footprint. In other words, you can put them more places. You dont have to invest in the bases. Youve got more flexibility about where you put them depending on the system. You might have a lot more flexibility over where you put the pilots uh. Pilots do think in many cases that they are gods gift to mankind. They demand a certain standard of living. Well, drone parts you can base you dont have to base them where the drones are, you can put them somewhere, nice and comfortable, and they can fly during their on hours.

This is important if youre, a nation that wants to operate from non ideal bases not everywhere, has top tier infrastructure, and there are advantages to being able to put your drones in the middle of nowhere if youre a nation with a very long coastline, for example, and Not all of its populated or if some of it is really mountainous and not heavily populated um or lacks a serious logistics chain. There are advantages here. Um and the final point i want to make is accessibility. Sovereign capability is really important defense and when i mean sovereign capability i mean the ability to do stuff yourself within the boundaries of your own nation, economically and militarily. This is really attractive. If you dont have to import a system from someone else, then youre not dependent on them for that system. Youre, not sending your money overseas and youre, also not creating the jobs overseas, youre, creating usually quite high tech, well paying jobs domestically within your own economy. So theres lots of incentives to have military industry in your nation its. Why nations spend so much in subsidies and try so aggressively to compete for this. But the problem is: at the at the complex end, few nations have the ability to design and manufacture advanced combat aircraft. Well, its a difficult capability. You really need a large military industrial complex and that needs to be supported by lots of graduates in the appropriate fields. Huge base of human capital, people whove built up their knowledge and expertise like lockheed martin isnt important just because of their factories theyre important because of their brains, trust the accumulated knowledge of everyone who works there that passes that knowledge down to the next people that work There i thoroughly recommend um ben richs book about the skunk works which talks about this development process in the good old days of lockheed under kelly johnson um.

So when youre talking about these really advanced systems, few nations have the ability to design develop, build them in an economically viable way. Try as they might new zealand, probably couldnt design and build an f 35 equivalent from the ground up, even if they really wanted to ive talked before about how china still struggles to replicate some parts of what russian industry knew, particularly with regards to engine technology. Theyre catching up um its difficult, but unmanned platforms, particularly the simpler unmanned platforms, are another story entirely. Israel is a major manufacturer. Turkey is becoming a major manufacturer. Australia has the loyal wingmen program and most of thats manufactured in australia. China is a huge global leader in drone manufacturing theres a lower barrier to entry. You can build a relatively simple drone for combat use as long as youve got a little bit of precision, manufacturing talent, the right universe, a couple of the right university graduates and a much smaller capital investment profile than it takes to make something like the f 35 Program or the f 22 program, or the b 21 raider program work and because theyre accessible. That means, if you decide to mix more of these into your your military, rather than relying on more expensive platforms, whether those be tanks or jets or whatever youre more likely to be able to build it at home, and that has its and that has a whole Suite of economic and political advantages and this arguments even scarier when we talk about the smaller munitions, um loiter, munitions, small drones.

So a lot of you will have heard the stories about the switchblade drones theres, a hundred of them being sent to ukraine. Firstly, thats thats, not a lot of switchblades um, the switchblade theres two models: the 300 600. I think its the 600s that are going to ukraine ive got a picture of a 300 there. Basically, this is this is a loiter munition, so think of it as like, an individual soldiers, smart bomb, it flies and its individually controllable and then its piloted into a target, and it explodes its like driving a missile in cod or something like that. Its a next generation small scale guided weapon system. There are other lloyd ammunitions that actually take the human partially or even fully out of the loop where, for example, the israelis have the suppression of enemy air defenses style, one which is basically an anti radiation missile. That circles an area until it picks up radiation, then it stops circling and goes and blows that thing up. When i say anti radiation, i mean if an anti aircraft radar, for example, starts emitting radiation. The loading munition can pick that up and go blow it up, which is normally a role that would be filled by specific aircraft, carrying anti radiation missiles, waiting to be lit up or have their friends lit up and then firing a missile and hoping they dont get Shot down in turn, or you can just do that with a loitering munition and in some ways these really small drones have a potentially disruptive impact kind of like the jdam, which was the joint direct attack attack munition, which is basically when the u.

s military industrial complex. Figured out that, instead of building extremely expensive laser guided bombs, they could strap some fins and a gps computer to all the old, dumb bombs they had left over from the cold war and for 18 or 20 thousand dollars turned them into guided munitions, really cheap conversion Into guided munitions – and this was world changing – i mean i know, pilots – that curse it to this day, because it basically turned a lot of fighter pilots or multi role. Pilots, um from you know, trying to do quite exciting missions to basically being jdam trucks where they just roll out with their guided munitions and drop them on targets without ever seeing anything. Similarly, potentially disruptive technology. But it gets even better because the entire system here at its extreme, might cost less than the flying error for a uh, a platform um the switchblade, the little the little one costs like six grand it costs six grand to fly an a10 for an hour uh And this thing sending its one way trip costs six thousand. You can keep it on its shelf and fire it when youre ready. The cost and accessibility advantage of these small systems is even more extreme than when youre talking about the tb2s most nations. That set their mind to it can probably build something like this can probably build. Just you take some commercial style. Drone technology. You put some smarts around it. Some good software, some decent sensors, keep it cheap and then manufacture it.

You dont need a particularly um scaled industrial base. You dont need lockheed martin in order to build this thing, so, where applicable, this thing is an opportunity for really asymmetric return on investment. What i mean by that? Well, if all the major powers are currently spending most of their funds, upkeeping their established systems, um theyre, theyre, keeping up their jets and their more advanced platforms, and you have a little bit of room in your budget and you are way behind, like you are way Behind um, you can spend your limited budget on purchasing unmanned platforms that have these capabilities, keep them on a shelf and youre accumulating potential, combat power and youre lowering the gap with your major power competitor, so lets just say: youre hypothetically youre, a small nation. You fear invasion by your large neighbor. Your large neighbor is maintaining a very large air force, army, navy, naval, infantry, paratroopers, etc. You can invest and you want to deter an invasion. You might choose to invest in more of these unmanned systems to narrow the gap. To give them something else to worry about the side. Note here is that theres terrifying potential for non state actors in these systems. I really dont want to know whats going to happen once terrorists have access to not dozens but potentially hundreds or thousands of these things. Quite terrifying and im also going to mention the potential of commercial drones here, because i havent scared you enough.

What we have seen in ukraine is little commercial off the shelf drones being used for battlefield purposes. We already knew this was possible, but now we have visual evidence of it. Weve seen ukrainians using civilian drones to drop modified uh grenades onto targets, weve seen them building one that can drop molotov cocktails, although they have no evidence that ones being used in combat weve. Seen them being used for artillery spotting for tactical awareness, all these uses for basically non military spect, non ruggedized civilian drones, and i asked the question here at the end here: there are scenarios, surely where you can deal with having one less jet in your inventory uh In exchange for having say 6 000 or 14 000 extra switchblades, or a thousand extra uh, more advanced heavier loiter munitions, theres a point where a little bit of investment buys you a lot of a capability um which forces your opponent to do an asymmetric counter, i.e. They spend more countering your spending than youre spending in return, and this is an inversion of the usual relationship. An anti aircraft missile used to shoot down an aircraft usually costs less than the aircraft. The anti tank missile used to kill the tank costs less than the tank in this situation, the weapon thats being intercepted these little lloyd ammunitions or these small drones may cost less and require less investment than the weapon being weapon system being used to counter them. One example, as ive seen, u.

s experiments with firing a stinger missile out of basically a javelin system with a bursting charge, proximity fuse to take out drones, thats, going to cost more than a lot of the things youre firing it at, and that provides an opportunity for The new power or the minor power whos choosing to invest in these capabilities or for a major power that chooses to give these things a higher priority in its investments. So what are my key? Takeaways ive tried to keep this one shorter. Hopefully its been helpful. The ukraine, russia war, is again giving us signs that the full range of unmanned aircraft and lawyer munitions are potentially highly effective. Weve seen just about everything being used in some respects and the evidence base we have so far is enough to suggest these weapons are at least a degree of effective. The tb2 has achieved wins. These smaller drones are being useful. The russian munitions have scored some victories, and that gives us a baseline level of an expectation of yeah. You know what maybe these things do work in a major conventional conflict. That being said, these systems are so much cheaper and so accessible that now that we know that they work its likely theyll continue to disrupt business as usual in defence investment. Just as and well probably do a video on this armored cores probably have to do a little bit of thinking about what their plans are given. What weve seen happen to armored vehicles when they go up against modern atgms and light infantry tactics with a little bit of drone assistance in ukraine? Likewise, the rest of the defense establishes going to have to seriously ask: are we investing heavily enough in our unmanned platforms? Are there tools that we have in service now that are too vulnerable to these things? Do we have appropriate countermeasures? Are we investing in countermeasures? Are we serious enough about this because theres a real danger that someone else is able to improve their balance of power relative to you by investing in these things or planning for them? When you stick with business as usual, the adoption of these new systems will, as i said, give smaller powers a chance to stand up in a sense.

The limitations of these platforms anyway seem to favor the sort of fighting that smaller powers are going to be doing. For example, if you look at the tb2, the thing does not have the speed range altitude or payload to do penetration rates or long distance, strategic aviation thats. Still the domain of the sort of expensive platforms that weve seen with the major powers, at least for now, but for sort of the small localized fighting that most powers are going to be worried about potentially being invaded by a large neighbor. For example, theyre proving plenty effective and they might be useful for balancing the books and providing a little bit more of a deterrent. That said, there are more unanswered questions over potential countermeasures, theres the issue of cost inversion. I talked about where it costs more to counter a system than to build it and as long as thats the case youre going to see out of control investment in these systems by everyone who can make use of them. But if that relationship is able to invert again, if, for example, it becomes becomes easier to intercept or jam or destroy these systems than it does to deploy them lets just say, jamming becomes really really effective. Soft kill systems become irresistibly effective or someone comes up with really cheap, affordable, hard kill systems. There are some really smart. Auto cannon proximity fuse base systems being tested around the world, for example. If those evolve, then it may be that some of these systems lose some of their utility.

Although i struggle to believe that things that are so cheap things like the the switchblade or whatnot will lose utility, because youd have to come up with a really cheap counter. In order to make that effective uh, my final point is yes, byrak tastronk, but its important that nations stop and take a cold look at their plans and the role these systems are going to play rather than just buying a whole bunch of tb2s. Like the lesson of the ukraine, conflict is not uh, the tb2 is a wunderwaffe and you should go buy a thousand of them. The lesson is not that if you are finland, you should spend your entire defense budget on the largest fleet of commercial quad road. As you can and rig them all with molotov cocktails and grenades, that is not the lesson of the ukraine conflict. You do not have the confidence to conclude something like that. What you can conclude is that these things work to at least a certain degree and well keep watching to see the extent to which thats true were learning a lot about how they can be used. We already know economically that they absolutely trounce manned systems in most regards when it comes to cost and deployment, accessibility, maintenance, domestic production, whole other suite and, as a result, there just needs to be a little bit of discipline in national spending priorities to ensure that youre, Not buying just what you know that youre not buying the fast jets, because you always have the fast jets that youre not buying a rolex when, like um the the watch on your iphone, will do.

Unmanned systems are proving effective. And if you want to maximize the efficiency of the dollars you have available to spend on defense, then maybe its worth following the ukrainian example and plowing a lot of what you can find into the most cost efficient stuff possible. One of those is unmanned systems and another is shoulder, fired, anti tank, guided missiles and thats. What we will talk about at some point in the future, but for now i hope this was useful, hope you enjoyed it, try to keep it sharp and punchy ive. Given you a summary of drone use in in ukraine, what that means for investment elsewhere next time, when im back its either going to be im, not sure yet its either going to be atgms and what they mean for the future of armored investment or its going To be a look at the use of reservists and irregular forces in ukraine, or it may be another topic, im monitoring the conflict day by day, i read all the comments and posts, so i look out for topics that are of interest for you. Thank you very much for listening. Ive been overwhelmed by the response today and i hope youve enjoyed this one as well.

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