A big tech industry group consisting of major Anthropic backers Amazon and Nvidia on Wednesday expressed concern over the Pentagon's decision to declare the artificial intelligence company a supply chain risk as other investors raced to contain fallout from the lab's fight with the U.S. Defense Department.
In a letter dated Wednesday, the Information Technology Industry Council, whose members include Nvidia, Amazon, Apple, and OpenAI, said, "We are concerned by recent reports regarding the Department of War’s consideration of imposing a supply-chain risk designation in response to a procurement dispute." The letter does not name Anthropic.
Tech Rivalry:
Anthropic and the U.S. Defense Department have been in a months-long dispute over how the military can use its technology on the battlefield.
The clash is widely seen as a referendum on how much control AI companies can have over the technology they've built and systems they hope can transform education, public services, and other aspects of society.
The Pentagon has pushed AI companies to drop red lines in favor of abiding by an all-lawful use clause.
But Anthropic has refused to back down on bans for its Claude AI to power autonomous weapons and mass U.S. surveillance.
Anthropic was first among peer AI companies to work with classified information through a supply deal via cloud provider Amazon.
OpenAI said on Friday that it reached its own classified deal with the Pentagon and that Anthropic should not be labeled a risk to the department.
"Our red lines were the same as Anthropic's, which is at this point in time, no domestic surveillance and no use of AI for autonomous weapons," Connie LaRossa, who works on national security policy at OpenAI, said on a panel at an Aspen Digital conference in Northern California on Wednesday.
"We are actually working to have the secure risk designation removed from Anthropic ... That shouldn't be applied to a U.S. industry counterpart with such an important tool."
The investors taking a stance on Pentagon talks are focused on helping Anthropic avoid being designated a "supply-chain risk" by the U.S. government, which, if implemented, could deliver a severe blow to the startup's fast-growing sales to business customers.
Demand has risen for Anthropic's products such as its chatbot Claude and coding assistant Claude Code.
Claude was the most-downloaded free app in the Apple App Store on Monday, surpassing OpenAI's ChatGPT.
Defense Secretary Pete Hegseth has said such a risk designation would require all government contractors to stop using Anthropic's technology in any part of their business.
While Anthropic also said Friday it would challenge any supply-chain risk designation in court.
Still, some investors worry the spat could scare off potential customers at a critical time for the startup.
Anthropic has raised tens of billions of dollars on lofty expectations for its enterprise sales, which make up about 80% of Anthropic's revenue, the startup has said.
The success of future share sales, including its widely anticipated initial public offering, hinges on Anthropic's continuing to build its business revenue. Anthropic is in the process of letting employees sell shares to investors, and the company has previously said there is no decision yet on its IPO.
Anthropic's revenue run rate, or its projected annual revenue based on current data, is about $19 billion, up from $14 billion just a few weeks ago.
Additionally, the push from investors came as several U.S. government agencies started terminating their use of Anthropic's technology, with the State Department switching to rival OpenAI, following Trump's order on Friday to dump Anthropic within the next six months.