OpenAI Secures Pentagon Deal as Anthropic Sidelined Over AI Safety Concerns

The race for AI dominance in government intensifies, with OpenAI and xAI emerging as key players

Published on Mar. 4, 2026

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The race to become the U.S. government's primary AI provider has intensified, marked by a series of events this week. OpenAI secured a landmark deal with the Department of Defense, while rival Anthropic was effectively sidelined after President Trump ordered federal agencies to cease all use of its technology. This shift highlights growing tensions between AI safety concerns and national security imperatives.

Why it matters

The situation underscores the critical role AI is already playing in global events and the urgent need to establish clear guidelines and regulations for the use of AI in military applications. The focus on 'safeguards' suggests a recognition of the risks associated with AI, but the ultimate effectiveness of these measures remains to be seen.

The details

Anthropic had previously been the first AI lab to deploy its Claude models across the DoD's classified networks, supporting intelligence analysis, operational planning, and cyber operations. However, contract renewal talks collapsed when Anthropic refused to grant the Pentagon broad 'lawful purpose' access to its models, citing concerns about the reliability of current AI for autonomous weapons and the potential for mass domestic surveillance. OpenAI, led by Sam Altman, quickly filled the void, announcing a deal with the Pentagon to deploy its models with similar 'red lines' to Anthropic, utilizing 'technical safeguards' agreed upon by the Department of Defense. Altman admitted internally that OpenAI 'shouldn't have rushed' the deal, acknowledging it appeared 'opportunistic and sloppy.'

  • In February 2025, Masayoshi Son, founder of SoftBank, met with OpenAI CEO Sam Altman in Tokyo.
  • This week, the events surrounding the OpenAI-Pentagon deal and the sidelining of Anthropic unfolded.

The players

OpenAI

An American artificial intelligence research company that has secured a landmark deal with the Department of Defense to deploy its models across classified networks.

Anthropic

An AI lab that had previously been the first to deploy its Claude models across the DoD's classified networks, but was effectively sidelined after President Trump ordered federal agencies to cease all use of its technology.

Sam Altman

The CEO of OpenAI, who acknowledged that the company 'shouldn't have rushed' the Pentagon deal and that it appeared 'opportunistic and sloppy.'

Pete Hegseth

The Secretary of Defense, who will have ultimate operational decisions on the deployment of OpenAI's models.

Elon Musk

The founder of xAI, which has also agreed to deploy its models across classified use cases and may be more willing to accept Pentagon demands without the same safety constraints as OpenAI.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident (San Francisco Chronicle)

“Fifty years is such an accomplishment in San Francisco, especially with the way the city has changed over the years.”

— Gordon Edgar, grocery employee (Instagram)

What’s next

The judge in the case will decide on Tuesday whether or not to allow Walker Reed Quinn out on bail.

The takeaway

This case highlights growing concerns in the community about repeat offenders released on bail, raising questions about bail reform, public safety on SF streets, and if any special laws to govern autonomous vehicles in residential and commercial areas.