BAE Systems Unifies AI & Simulation with OneArc to Capture Defense Market

MCLEAN, VA – December 04, 2025 – In a strategic move that signals a major shift in the defense technology landscape, BAE Systems has officially launched BAE Systems OneArc, a new commercial-focused entity designed to dominate the rapidly growing market for AI-driven military simulation and training. The initiative consolidates the powerhouse capabilities of three strategic acquisitions—Bohemia Interactive Simulations, TerraSim, and Pitch Technologies—under a single, agile banner, aiming to deliver "ready-now" solutions to the U.S., NATO, and their allies.

This isn't just a rebranding exercise. The formation of OneArc represents a calculated business strategy to move faster than traditional defense procurement cycles allow. By unifying these market-leading specialists, BAE Systems is creating a one-stop shop for synthetic training environments, positioning itself to capitalize on the increasing military demand for commercial off-the-shelf (COTS) technology that can deliver sophisticated capabilities with speed and accessibility.

A Strategic Consolidation for Commercial Advantage

For years, BAE Systems has been quietly assembling a portfolio of best-in-class simulation and interoperability companies. The launch of OneArc crystallizes this investment into a cohesive go-to-market strategy. By bringing Bohemia Interactive Simulations (BISim), TerraSim, and Pitch Technologies under one roof, the company is betting it can create synergies that outmatch fragmented competitors and even the internal divisions of other defense giants.

The core of this strategy lies in offering integrated, commercially-backed products. OneArc inherits a formidable suite of tools already trusted by militaries worldwide. This includes BISim's flagship VBS4 (Virtual Battlespace), a whole-earth virtual training platform used by over half a million personnel across 60 nations. It also includes TerraSim's TerraTools, the industry-leading software for generating the highly detailed virtual terrains that make these simulations realistic, and a suite of products from Pitch Technologies, a global leader in ensuring different simulation systems can communicate with each other.

"OneArc embodies integration, collaboration, and collective advancement, emphasizing the power of unity and shared purpose," said Rahul C. Thakkar, OneArc president at BAE Systems, in the company's announcement. This statement underscores the business logic: by integrating these complementary technologies, OneArc can offer a more powerful, seamless solution than the sum of its parts. The goal is to provide a unified platform that reduces friction for military clients, who often struggle to integrate disparate systems from multiple vendors.

AI at the Core of Modern Military Readiness

While simulation is the foundation, artificial intelligence is the critical layer that transforms these training tools into dynamic, predictive, and truly effective learning environments. OneArc is explicitly tasked with advancing capabilities in AI and data analytics. This goes beyond creating realistic scenery; it's about populating these virtual worlds with intelligent actors and providing deep analysis of training performance.

Concrete applications are already emerging. OneArc's VBS4 platform is being leveraged in new drone training systems, where AI-powered actors simulate enemy unmanned aerial systems (UAS), allowing operators to practice complex counter-UAS tactics in a safe, repeatable environment. This integration of AI is crucial for preparing warfighters for a battlespace where autonomous systems are increasingly prevalent.

Furthermore, BAE Systems' broader corporate focus on AI for "decision advantage" and "total situational awareness" will undoubtedly filter into OneArc's product roadmap. The vast amounts of data generated during large-scale simulations are a goldmine for AI-driven analytics, which can be used to assess troop readiness, refine doctrine, and predict outcomes of different tactical approaches. This transforms training from a simple rehearsal into a powerful data-gathering and strategy-testing engine.

Forging Alliances to Dominate Interoperability

Perhaps OneArc's most significant business impact lies in its focus on interoperability—the holy grail for multinational military operations. For decades, a primary challenge for NATO and allied forces has been ensuring that their disparate command, control, and communication systems can work together. OneArc's inherited DNA from Pitch Technologies, a key contributor to NATO's High Level Architecture (HLA) interoperability standards, gives it immense credibility in this domain.

Underscoring this strategy, BAE Systems OneArc announced a Memorandum of Understanding (MoU) with Plexsys just a day before the official launch. This partnership aims to integrate Plexsys's Advanced Simulation Combat Operations Trainer (ASCOT) 7 environment with OneArc's VBS4 platform. The business implication is profound: it creates a unified system for generating and visualizing complex training scenarios across every military domain—air, land, sea, space, and cyber.

For military clients, this integration promises a more immersive and operationally relevant Live, Virtual, and Constructive (LVC) training experience. Instead of cobbling together separate tools for air and ground simulations, commanders can run fully integrated, multi-domain exercises on a common platform. This not only improves the quality of training but also streamlines procurement and technical support, offering a compelling value proposition that competitors will find difficult to match. By synchronizing technical roadmaps, OneArc and Plexsys are co-developing a solution that directly addresses the core need of modern, alliance-based warfare.

Capturing the Future of Defense Tech

The launch of OneArc is timed perfectly to capitalize on powerful market tailwinds. Global defense budgets are rising, and the demand for cost-effective, repeatable, and safe training solutions has never been higher. The global military simulation market is projected for substantial growth, driven by the shift toward Multi-Domain Operations and the need to prepare for technologically advanced adversaries.

OneArc's emphasis on being "designed for speed, agility, and accessibility" directly targets the military's growing appetite for COTS solutions. By offering proven, commercially supported products, BAE Systems can bypass the notoriously slow and expensive development cycles of traditional defense programs. This agile model allows military customers to acquire cutting-edge capabilities faster, keeping pace with the rapidly evolving threat landscape.

This move is a clear indicator of BAE Systems' vision for the future. While the company remains a titan of building physical defense hardware like ships, aircraft, and armored vehicles, the creation of OneArc demonstrates a deep strategic commitment to the software, data, and artificial intelligence that will increasingly determine mission success. By unifying its premier simulation assets, BAE Systems is positioning itself not just as a supplier of platforms, but as the architect of the virtual environments where the future of warfare will be rehearsed, refined, and ultimately won.