WHERE'S THE MONEY GOING NEXT?

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP73-00475R000200690001-0
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 27, 2016
• Document Release Date: January 6, 2014
• Sequence Number: 1
• Publication Date: May 7, 1966
• Content Type: OPEN SOURCE

?STAT
Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr 2014/01/06 CIA-RDP73-00475R000200690001-0
May 1966
VDEFENSE
0 Where's the money going next?
STAT'
A small company called is one of a number that thrive
by ferreting out and publishing information that helps
indust to ails er this questiol....., Defense Dept.
DMS probers James Ratliff, Richard Marshall, and William Lamed (seated) head
staff that collects, sifts, and collates infomiation from throughout the world.
Researching the defense market is
harder than it looks. There is only
one customer, but its needs are so
complex and varied that keeping up
with the advent of new programs
and the death or slowdown of others
is difficult.
You may know all about Minute-
man III, the F-111, or C-5A, but?
what's the latest on Taurus, Lash,
VAX, or the ADO-12? Many com-
panies that monitor contract awards
and issue newsletters or market-
information services are trying to
supply such data. Among the most
successful of these is 1:41?.6.1u,s,L1
Greenwich, Conn.
ot?igE131C4 priy_a_t_g_iatelllopze
seKTC-e-cov?eros.paceamfddme,
eretronid s&'Welt tliat. the -CentraL
Intelligeoce Agency subscribes, teat,.
Lathed: its president, I
says, "This is not a snoop and spy
operation.'.
-,?WhIttarned means is that DMS
. men do not tap telephones or peer
through keyholes in their search for
information on defense programs.
Aside from that, though, their
methods closely resemble those of
any intelligence organization: patient
collection, sifting, and collation of
facts from open sources all over the
world.
A natural. The method of opera-
tion is no accident. Before Lamed, a
fourth-generation West Power,. re-
signed from the Army in 1955, he
had been assigned to the office of the
assistant chief of staff for intelli-
gence. He met latnz.11,.B.atliff,
executive?ViFe-president of DMS,...
when --both.- were"-IniOlied- with
sguakeFintelligpnce work in Ger-
Many.
?_-DMS---for Defense ? Marketing !
Services?began when Lamed ioined
Servomechanisms, Inc., in 1955 as
assistant director of marketing. He
soon discovered the . haphazard
nature of market research in the
aerospace industry.
Servomechanisms made electronic
devices for military jet planes.
Lamed -began to analyze every
future jet program he could identify
and tried to project how big it might i
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Declassified in Part - Sanitized Copy Approved for Release a 50-Yr 2014/01/06 : CIA-RDP73-00475R000200690001-0
Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr
'r
be. He kept the information in
loose-leaf book, which he intended
as a simple tool for sales forecasting.
However, the reaction of one Air
, Force planner in the Pentagon
started him thinking differently.
. Asked to help fill in some of the
blanks in Larned's program sheets,'
, the Pentagon man commented that
' they contained more useful informa-
tion in one place than he had seen.
anywhere else. "I ended by giving
. him half a . dozen copies of the
, book," Lamed recalls.
Take-off. By 1959, he was working
for what is now TRW; Inc., in Los
Angeles, and was ready to launch
DMS as an independent venture.
The first book covered rockets, mis-
siles, and spacecraft. It was sold as
a loose-leaf service that would be
updated each month. The price: $175
a year. DMS, which now has a staff
of 47, was then a family business:
Lamed wrote the material, his wife
collated the printed sheets in their
garage, and their three , childrem
stuffed envelopes. "Our first sale was
Texas Instruments," says Lamed,
"and they're still with us."
Since then, DMS has moved to
Greenwich and added five more:
aerospace information services. The
new books cover military and civil.
aircraft, ground support equipment,
military electronic systems, reports
on companies, and reports on agen-
cies. The price is now $300 a year:
? for each service, six for $1,400. Thei
books are updated monthly with 3001
or more pages of new material.
Subscribers have the right to call;
DMS with specific questions as often,
as they like. Some recent queries in '
the log include: What is the unit cost '
of the BLU-29/B bomb? What does I
the code name Dancing Doll mean?
What will the total requirement for
Titan II be? Is Nike-X going to be
deployed in fiscal 1968?
Everything counts. Richard C.
Marshall, vice-president for opera-
tions, points out that some coin-
panies subscribe mainly for the;
query privilege. The questions asked,
'become part of the OMS information '
collection process. The existence of
a new defense program may be tip-
ped off by customer calls.
Obviously, military security can I
present problems in such cases.
DMS has stayed out of trouble, says
Lamed, by putting reports together;
only from publicly known informa-
tion. When rumors of a new system
are going around, DMS' Washington ,
I field office will ask about it officially. ,
i If the subject is classified, it will not !
press the matter.
Useful in keeping. DMS above 1
suspicion, Lamed thinks, is the fact ,
that Pentagon people and congress-
MAY 7 1966
Declassified in Part - Sanitized Copy Approved for Release @ 50-Yr
2014/01/06: CIA-RDP73-00475R000200690001-0
men concerned with defense are
used to seeing the service around.
Not only are there a number of
Pentagon subscribers, but DMS has
seen to it that volumes concerned
with military hardware are available
to the staffs of Congressional com-
mittees.
? Also, DMS limits subscriptions.
Says Lamed: "We don't sell to any-
one we don't know." In practice this
means that there are no individual
subscriptions, only corporate and
government ones. And to clear up
another gray area, DMS recently got
a letter from the Defense Dept.
authorizing it to sell its services
abroad only to countries and com-
panies associated with the North
Atlantic Treaty Organization.
Branching out. More and more
companies in the financial com-
munity are DMS subscribers. Some
60 brokerage and investment houses
take all or part of the service, and .
research-oriented mutual funds are
beginning to notice it, .too. DMS'
book on companies, first issued last
spring, is of particular interest to
analysts. It covers 75 companies in
great detail ("from Aerojet to West-
inghouse"), and these, Lamed points
out, account for $18-billion, or
nearly 95%, of aerospace procure-
ment dollars.
With a huge and constantly grow-
ing bank of data on punch cards and
computer tape, Lamed is looking
beyond the aerospace business for
ways to use DMS information and
talents. First on the list is a series of
special reports on technological
areas of interest to business: ocean-
ography, infrared technology, de-
salination, pollution, transportation,
and a dozen more. The first one will
be on lasers.
DMS has already done several
such studies for specific clients. One
covered the future of medical elec-
tronics; another was a huge projec-
tion of the world demand for civil
and military aircraft, country by
country, through 1975.
Raring to go. Farther in the future,
Lamed plans a programmed busi-
ness information service covering
the European Common Market. He .?
admits that the problems of gather-
ing data in Europe are formidable
and might call for "clandestine
effort."
With DMS operating at the annual
rate of $750,000, up from just under
$500,000 last year, Lamed is think-
ing of ways to expand the operation
more rapidly. Public financing is in
the cards to help pay for more
sophisticated data processing equip-
ment. Beyond that, acquisition pos-
sibilities would open up if DMS had
stock to offer. End
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2014/01/06: CIA-RDP73-00475R000200690001-0