A few weeks ago, we posted about the clash between Anthropic and the Department of War (DoW). Our assessment was premature; developments have been racing ahead.
We asserted that Anthropic’s rejection of the DoW contract over the issues of domestic mass surveillance and the deployment of autonomous weapons, and its consequent replacement by OpenAI, occurred within the context of fierce competition between AI companies. Since then, Anthropic has sued the DoW and won in a San Francisco federal court, momentarily blocking the Pentagon from labeling the company a supply-chain risk. However, the company then lost on appeal in the U.S. Court of Appeals in Washington, D.C. Anthropic’s oral argument is scheduled for May 19 in Washington, D.C., at the appeals court.
It’s puzzling to see Anthropic taking on the DoW, but even more extraordinary is that when Anthropic sued the Pentagon, its rivals – Google, Microsoft, Amazon, and Palantir – banded together to support it. Microsoft even filed an amicus curiae (“friend of the court”) brief, as did employees from Google and OpenAI; and neither company’s management objected.[1] These corporations are locked in competition with each other in global markets, all the while trying to cozy up to the Trump administration. What’s happening? Is Anthropic acting as a bellwether, setting new ethical standards for the tech industry? Why are these rivals suddenly uniting against the DoW? This exceptional clash within the core of today’s military-industrial complex requires some additional exploration.
Until its widely publicized dispute with the Pentagon, Anthropic was relatively unknown to the general public. This was because Anthropic’s strategy has been to target the rapidly growing AI enterprise market: nearly one in three US businesses paid for Anthropic’s tools in March 2026,[2] under a widely publicizedguarantee of security and trust – essential to winning their business (only recently has it springboarded into the consumer market as well). Thus, Anthropic generally flew under the public radar. In contrast, OpenAI’s strategy has focused overwhelmingly on the consumer market, in which it claims 900 million users[3] (however, as its competition with Anthropic intensified, OpenAI also began to cultivate the enterprise market).
A major plank in Anthropic’s “B2B” enterprise approach has been to leverage ties with the major tech companies, trying to get them to integrate Anthropic’s Claude AI model into their other applications.
Microsoft – which initially invested and exclusively used OpenAI – has more recently incorporated Claude into its enterprise suite. This was a boon to both companies. Microsoft is one of the largest government contractors, and its technologies are deployed across all levels of government, including the DoW and other federal agencies. If Anthropic is designated a supply chain risk and government agencies are forbidden to use it, then, Microsoft will need to find a Claude replacement and will be negatively impacted financially and strategically. Microsoft isn’t the only tech company that has incorporated Anthropic’s AI models. Others too are acting as both financial backers and users of Claude.