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Lockheed sees strong cyber demand despite NSA scandal -CEO

Andrea Shalal-Esa
Monday, 16 Dec 2013 | 5:28 PM ET

WASHINGTON, Dec 16 (Reuters) - Lockheed Martin Corp, the Pentagon's No. 1 supplier and top provider of information technology to the U.S. government, said on Monday there is continued demand for cybersecurity services, despite the National Security Agency spying scandal.

Lockheed Chief Executive Marillyn Hewson told Reuters in an interview on Monday that concerns about alleged spying by the NSA were not slowing the company's aggressive push to market its information technology and cybersecurity services overseas.

"It hasn't been a negative effect on our business," Hewson said. "We continue to have strong demand for our cyber capabilities from the U.S. government and other governments around the world, and we also have a business where we support commercial companies."

Lockheed, the largest contractor for the NSA, and other government contractors have sought to expand their expertise in protecting government networks into service contracts with private companies, thus far with mixed success.

But those capabilities are drawing increased interest from foreign governments, including many in the Middle East, according to Hewson, who is due to visit the region again this month, her fourth visit since she became CEO in January.

Lockheed is expanding its presence in seven countries it has identified as central to its overseas expansion: Britain, Australia, Canada, Japan, Israel, the United Arab Emirates and Saudi Arabia.

Hewson said the company's biggest growth drivers were its stealthy F-35 fighter jet, air and missile defense systems, and its C-130J transport aircraft, but the company's satellite technology and its government IT services were also growing.

Pat Dewar, who heads a new international unit, Lockheed Martin International, created in July, told Reuters last month that Lockheed's fighter jets and other military equipment were well known overseas, but the company still had work to do demonstrating its role as a key IT provider.

Hewson told Reuters she expected continued growth in the company's government and commercial cyber businesses in coming years, given mounting concern about attacks on computer networks around the world.

"I would expect that to continue to grow just by nature of the threat, despite what happened in the Edward Snowden affair," Hewson said, noting that Lockheed was engaged more in higher-value mission support than just providing employees with security clearances. "I think that demand is accelerating."

She said Lockheed's work on providing computer security for satellite communications, missile defense systems and other weapons it builds helped underpin demand for its IT services.

She gave no details about the company's work for the NSA or other intelligence agencies.

A U.S. federal judge on Monday ruled that the U.S. government's gathering of the telephone records of Americans is likely unlawful, a significant challenge to U.S. spying authority.

The British newspaper The Guardian, citing leaks by former NSA contractor Snowden, reported in June that a U.S. surveillance court had secretly approved the collection of millions of raw daily phone records, such as the length of calls and the numbers dialed. The data collected do not include actual conversations, U.S. officials said.

Civil liberties advocates have called the database an intrusion on privacy and they sued to end it, while the government has said the ability to search data going back seven years is crucial to fighting militant groups such as al Qaeda.

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