The Pentagon and AI startup Anthropic (ANTHRO) are at a standstill over safeguards that would prevent the government from deploying its technology to target weapons autonomously and conduct U.S. domestic surveillance, Reuters reported, citing people with knowledge of the matter.
Following extensive discussions under a contract worth up to $200M, the U.S. Department of Defense — renamed as the Department of War under the Trump administration — and Anthropic are at odds, the report added.
Anthropic’s position on how its AI tools can be used has increased disagreements between the company and the Trump administration, according to the report.
The Department of War and Anthropic did not immediately respond to a request for comment from Seeking Alpha.
Anthropic said its AI is “extensively used for national security missions by the U.S. government, and we are in productive discussions with the Department of War about ways to continue that work,” according to the report.
Anthropic was among the few companies, including Alphabet’s (GOOG) (GOOGL) Google, Elon Musk’s xAI (X.AI), and OpenAI (OPENAI), that were awarded contracts by the Pentagon last year, the report added.
In its talks with government officials, Anthropic representatives raised concerns that its tools could be used to spy on Americans or help weapons targeting without sufficient human oversight, the report noted.
In line with a Jan. 9 department memo on AI strategy, Pentagon officials noted that they should be able to deploy commercial AI technology regardless of companies’ usage policies, as long as they comply with U.S. law, the report added.
However, Pentagon officials would likely require Anthropic’s cooperation going ahead. The company’s AI models are trained to avoid taking steps that may lead to harm, and Anthropic staffers would be the ones to retool its AI for the Pentagon, the report noted.
In an essay on his personal blog, Anthropic CEO Dario Amodei said this week that AI should support national defense “in all ways except those which would make us more like our autocratic adversaries.”
Earlier this week, Amodei and OpenAI’s CEO Sam Altman had spoken up after tragic events in Minnesota. Altman had said that ICE had ‘gone too far,’ while Amodei called the events a ‘horror.’
The two AI giants are in a race to get to an IPO. ChatGPT developer OpenAI (OPENAI), reportedly, is holding informal talks with banks about a potential IPO in the fourth quarter of this year. Meanwhile, Anthropic (ANTHRO), which is behind the Claude AI assistant, is reportedly also laying the groundwork for an IPO this year.
Anthropic — which is backed by Amazon (AMZN) and Google — expects to generate up to $148B in 2029 in its most optimistic projections, about $3B more than what OpenAI projected to make that year, according to a report.
In November 2025, Nvidia (NVDA) and Microsoft (MSFT) committed to invest up to $10B and up to $5B, respectively, in Anthropic. Microsoft has invested over $13B in OpenAI, giving it nearly a 27% stake in the ChatGPT maker.
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