OpenAI secures Pentagon contract hours after Trump administration blacklists Anthropic

OpenAI announced a deal with the Pentagon to deploy its AI models on classified military networks, hours after President Trump ordered all federal agencies to stop using Anthropic and Defense Secretary Pete Hegseth designated Anthropic a 'supply chain risk to national security'—a label typically reserved for foreign adversaries. Anthropic had refused Pentagon demands to allow its AI for 'all lawful purposes,' insisting on two red lines: no domestic mass surveillance and no fully autonomous weapons. OpenAI CEO Sam Altman claimed his deal reflects these restrictions. Pentagon sources contradicted this claim, saying that the deal allows use for all lawful purposes. OpenAI scrambled to amend the deal after backlash from employees and the public. CEO Sam Altman admitted the deal "looked opportunistic and sloppy" and was "rushed." The company now claims to have added an explicit prohibition on domestic surveillance of U.S. persons, barred Defense Intelligence Components (NSA, NGA, DIA) from using its services, and restricted use of commercially acquired personal data. ChatGPT downloads declined following the backlash over OpenAI’s rushed Pentagon deal, as consumers shifted to Anthropic’s Claude, which hit #1 on the App Store.