The U.S. Department of Defense (DoD) has awarded contracts worth up to $200 million each to four leading AI companies, OpenAI, Google, Anthropic, and Elon Musk’s xAI, in a strategic push to integrate advanced AI across military and security operations.

The initiative, announced on Monday, aims to scale the use of artificial intelligence in defense applications, with each firm selected to accelerate innovation in areas critical to national security.

DoD Prioritizes Agentic AI Workflows to Support Warfighters

The contracts will support the development of agentic AI workflows, autonomous systems capable of complex, goal-directed tasks within military infrastructure.

According to the Chief Digital and Artificial Intelligence Office (CDAO), this technology will be key to improving mission readiness and operational efficiency.

“The adoption of AI is transforming the (DoD’s) ability to support our warfighters and maintain strategic advantage over our adversaries,” said Doug Matty, the Department’s Chief Digital and AI Officer.

Musk’s xAI Launches “Grok for Government” for Federal Use

In a parallel announcement, xAI unveiled a new suite of products under the brand “Grok for Government,” offering its flagship large language model, Grok 4, to U.S. agencies across federal, local, and national security levels.

The move signals Musk’s increasing involvement in federal AI applications, with xAI positioning itself as a competitive force in the national AI landscape.

Contract Awards Raise Scrutiny Over Competitive AI Procurement

The contracts deepen collaboration between tech giants and the U.S. government, but have also reignited debate over procurement practices.

In May, Senator Elizabeth Warren called on the DoD to ensure transparent and competitive AI contracting, amid growing adoption of Musk’s Grok within government agencies.

Monday’s announcement follows an earlier $200 million award to OpenAI, disclosed in June.

The Pentagon stated that OpenAI would "develop prototype frontier AI capabilities to address critical national security challenges in both warfighting and enterprise domains".

This latest round of funding reflects a broader policy shift. Federal use of AI has surged under a White House directive issued in April, while President Donald Trump recently repealed an executive order from 2023 intended to regulate AI development through mandatory data transparency.

PHOTO: UNSPLASH

This article was created with AI assistance.