Pentagon declares Anthropic a supply-chain risk after Trump orders federal AI ban

Core Viewpoint - The Pentagon has designated Anthropic PBC as a supply-chain risk, following President Trump's directive for federal agencies to cease using its products, marking a significant conflict between the AI company and defense officials over technology safeguards [1][16]. Group 1: Government Actions and Responses - Defense Secretary Pete Hegseth has ordered the Pentagon to prohibit contractors from engaging in any commercial activities with Anthropic, setting a six-month deadline for the company to transition its AI services to another provider [1][4]. - Trump warned that failure to comply with the handover could result in unspecified "major civil and criminal consequences" for Anthropic [2]. - Hegseth emphasized that the decision is final, asserting that "America's warfighters will never be held hostage by the ideological whims of Big Tech" [2]. Group 2: Financial Implications - The Pentagon's decision could eliminate up to $200 million in contracts that Anthropic had secured for military and civilian agency work, including the State Department [4]. - Anthropic is under pressure to attract more business to offset the high costs of AI development and justify its valuation of $380 billion, with expectations of an initial public offering this year [7]. Group 3: Technology and National Security - Anthropic's Claude Gov tool was previously the only AI system capable of operating within the Pentagon's classified cloud, raising concerns about national security following its removal from government use [8]. - The company has insisted that its technology not be used for mass surveillance or in fully autonomous weapons operations, which has been a point of contention with the Pentagon [5][16]. Group 4: Industry Reactions and Future Prospects - The conflict has sparked backlash from Silicon Valley, with tech workers rallying in support of Anthropic and urging their companies to reject Pentagon demands for unrestricted AI usage [11]. - Anthropic's CEO Dario Amodei has stated the company will not comply with the Pentagon's requests, maintaining its stance on responsible AI use [11]. - The Pentagon's recent strategy on AI aims to make the military an "AI-first" force, which may further complicate relations with AI companies like Anthropic [13].