The U.S. Department of Defense formalized its strategy for leveraging cutting-edge artificial intelligence on July 15, 2025, by awarding separate contracts to four leading American AI labs: OpenAI, Google, xAI, and Anthropic. As reported by authoritative publications Reuters and NextGov/FCW, each of these framework agreements could be worth up to $200 million. These contracts, referred to by defense officials as "frontier AI" contracts, do not involve the purchase of off-the-shelf products but are aimed at a_joint development and rapid prototyping of advanced AI solutions for a wide range of national security needs. The initiative is apparently being overseen by the Pentagons Chief Digital and Artificial Intelligence Office (CDAO). The adopted strategy is a classic "portfolio approach." Instead of betting on a single technology provider, which carries the risk of "vendor lock-in," the U.S. Department of Defense is creating a competitive environment, gaining access to the unique capabilities and strengths of each lab. This allows the department to select the best technology for each specific task, whether its intelligence analysis, logistics optimization, cybersecurity, or decision support systems in command and control. This move marks the formal establishment of a new "AI military-industrial complex," in which leading private technology companies become key partners with the state in ensuring its technological superiority. It also guarantees the leading AI labs stable government funding for their most advanced and resource-intensive developments.
Pentagon Awards "Frontier AI" Contracts to OpenAI, Google, xAI, and Anthropic
