Industry shifts: startups poised to break into defense market.

• Position: WASHINGTON PULSE

A small number of large firms currently garner the preponderance of Pentagon and NASA procurement dollars. Their dominance seems immutable.

Or maybe not.

A confluence of economic and technological factors is creating conditions for startups to break into the government's old-boy network of aerospace and defense suppliers, some experts contend.

The current environment is reminiscent of the shakeup witnessed in the information-technology industry of the late 80s and early 90s, said Chris C. Kemp, chief information officer at NASA Ames Research Center in Silicon Valley. The implosion of long-established IT firms that could not survive the onslaught of the Internet offers an eerie parallel to what is happening today in aerospace, Kemp said in a presentation at the National Press Club. Does anyone even remember Wang Laboratories, or Data General?

"Small businesses are more agile. They can take advantage of targets of opportunity as they...