The U.S. Department of Defense (DoD) has awarded contracts worth up to $200 million each to OpenAI, Alphabet's Google, Anthropic, and Elon Musk's xAI, marking a significant push to scale advanced AI capabilities within the military.
Announced on July 14, 2025, these contracts aim to develop "agentic AI workflows" to address critical national security challenges, according to the DoD's Chief Digital and Artificial Intelligence Office (CDAO).
The initiative reflects a strategic effort to leverage cutting-edge commercial AI technologies to maintain a strategic advantage over adversaries.
This development builds on a previous $200 million contract awarded to OpenAI last month, which focused on prototyping frontier AI capabilities for both warfighting and enterprise applications.
The latest awards expand this effort, integrating all major AI players into the defense ecosystem. The CDAO emphasized that these partnerships will enhance the DoD's ability to support warfighters and streamline operations across intelligence, business, and enterprise systems.
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The move comes amid growing government interest in AI, spurred by a White House directive in April 2025 promoting its adoption. Notably, xAI also launched "Grok for Government" on the same day, offering its advanced models, including the new Grok 4, to federal, state, and national security clients. While the contracts signal a deepening collaboration between tech giants and the Pentagon, they also raise questions about competition and ethical considerations in AI deployment for military use. This integration marks a pivotal moment in reshaping national security through artificial intelligence.
