Big Tech Group Backs Anthropic in Pentagon Dispute Over AI Safeguards

MANILA, Philippines — A major technology industry group backed by leading AI investors has voiced concern over the US government’s move to potentially label artificial intelligence firm Anthropic as a “supply-chain risk,” as investors attempt to ease tensions between the company and the Pentagon over military use of AI.

In a letter dated March 4, the Information Technology Industry Council (ITI)—whose members include Amazon, Nvidia, Apple, and OpenAI—warned against using a supply-chain risk designation as a response to a procurement dispute with an AI developer. The letter did not directly mention Anthropic but referred to reports that the US Department of Defense, renamed the Department of War under President Donald Trump’s administration, is considering the measure.

Anthropic CEO Dario Amodei has recently discussed the issue with major investors and partners, including Amazon CEO Andy Jassy, according to people familiar with the matter. Venture capital firms such as Lightspeed and Iconiq have also been coordinating with Anthropic leadership and other investors to find ways to defuse the situation.

Some investors have reportedly reached out to contacts within the Trump administration in an effort to reduce tensions and prevent a broader ban on Anthropic’s AI systems across Pentagon contractors.

Dispute Over Military AI Use

The conflict stems from a months-long disagreement between Anthropic and the Pentagon over how the military can deploy the company’s AI technology.

The US defense establishment has pushed AI developers to accept an “all-lawful use” clause that would allow military applications as long as they comply with the law. Anthropic, however, has refused to lift restrictions on certain uses of its Claude AI models, particularly for autonomous weapons systems and large-scale domestic surveillance.

The dispute is widely seen as a test case for how much control AI companies should retain over technologies they create—especially as governments increasingly seek to deploy advanced AI systems in defense operations.

Anthropic previously became one of the first AI companies to work with classified information through a supply arrangement with cloud provider Amazon.

Meanwhile, OpenAI said it had reached its own classified agreement with the Pentagon and argued that Anthropic should not be designated as a supply-chain risk. Speaking at an Aspen Digital conference in Northern California, OpenAI national security policy adviser Connie LaRossa said both companies previously shared similar limits on military use.

“Our red lines were the same as Anthropic’s—no domestic surveillance and no use of AI for autonomous weapons,” LaRossa said.

Investor Pressure and Business Risks

Despite publicly backing Anthropic’s stance, some investors have expressed frustration over how the dispute has been handled, saying the situation reflects both diplomatic and strategic challenges.

According to sources, investors want to avoid a scenario where Anthropic appears to back down completely—something that could alienate employees and customers drawn to the company’s strong ethical safeguards.

At the same time, a formal supply-chain risk designation could severely impact Anthropic’s business by forcing government contractors to stop using its technology.

US Defense Secretary Pete Hegseth has said such a designation would require contractors to remove Anthropic’s AI systems from their operations. The company disputes that claim, arguing the Pentagon lacks legal authority to block use of its technology outside defense contracts and saying it would challenge the move in court if necessary.

Growth and Market Stakes

The stakes are particularly high for Anthropic as demand for its products—such as the Claude chatbot and the Claude Code programming assistant—continues to surge. The Claude app recently became the most downloaded free application in Apple’s App Store, surpassing OpenAI’s ChatGPT.

Anthropic’s projected annual revenue run rate has reportedly climbed to around $19 billion, up from roughly $14 billion just weeks earlier.

However, investors worry that the ongoing conflict with the US government could deter potential enterprise clients who want to avoid political or regulatory scrutiny.

The company has raised tens of billions of dollars from investors and relies heavily on enterprise customers, which account for about 80% of its revenue. Future fundraising efforts—including a potential initial public offering—could depend on whether Anthropic maintains its growth momentum while resolving tensions with the Pentagon.

Some US government agencies have already begun shifting away from Anthropic’s systems following Trump’s directive ordering federal agencies to phase out the company’s AI technology within six months. The State Department, for example, has reportedly switched to OpenAI tools.

Anthropic and Pentagon officials are still holding discussions, though details of those talks remain unclear.

— News AI PH / with reports from Reuters