Anthropic's AI standoff with the Pentagon is nearing a critical deadline

Anthropic and the Pentagon are facing off over deploying AI for military use, with a day left until a government-imposed deadline.

Earlier this week, the Department of Defense delivered an ultimatum to Anthropic compelling the company to yield to its demands by Friday afternoon. Pentagon officials are seeking unrestricted access to Anthropic’s Claude AI model, which is currently viewed as a more powerful product compared to other AI products on the market like Grok.

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Anthropic, though, has pressed for assurances its AI won’t be engaged in mass surveillance of Americans or used in autonomous weapons that don’t require human oversight. CBS News reported on Wednesday evening that the Pentagon had sent Anthropic its latest offer to resolve the standoff.

No details about the offer were immediately available.

The Defense Department has reportedly threatened to label Anthropic as a “supply chain” risk that could lead to the loss of its government contracts, a move usually reserved for foreign rivals. It might also invoke the Defense Production Act, an extraordinary step that could pave the way for the U.S. government to commandeer the company’s AI technology.

The Pentagon and Anthropic did not immediately respond to a request for comment.

Analysts have pointed to a contradiction in the Trump administration’s hardline approach to the company. Labeling Anthropic as a supply chain risk would bar the government from using its products. Yet invoking the Defense Production Act would allow it to claim Anthropic’s AI model is essential to national security.

Anthropic has cultivated a reputation as a "safety-first"AI company, and its CEO Dario Amodei has said that the AI products it is developing must be regulated. But the company announced on Tuesday it was dialing back its safety commitments so its AI models can better compete with other AI products.

Other AI-minded executives appear to be paying close attention to the showdown. Nvidia $NVDA +1.66% CEO Jensen Huang said he wants a negotiated resolution between the Pentagon and Anthropic.“I hope that they can work it out, but if it doesn’t get worked out, it’s also not the end of the world,” Huang told CNBC.

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