In recent years, competition for U.S. defense contracts has become increasingly fierce, and traditional military industry giants are facing new challenges. This article reports on Palantir, Anduril and other technology companies joining forces with SpaceX and OpenAI to try to break the long-term monopoly of companies such as Lockheed Martin, Raytheon and Boeing and participate in bidding for US Department of Defense contracts. The move sparked widespread discussions about tech companies' involvement in the defense sector, ethics and the influence of Peter Thiel.
According to the Financial Times, well-known defense technology companies Palantir and Anduril, founded by Palmer Luckey, are negotiating with technology companies such as SpaceX and OpenAI, planning to form an alliance to bid for U.S. government defense contracts.
The goal of this alliance is to break the monopoly of traditional "prime" contractors in the defense field, mainly against companies such as Lockheed Martin, Raytheon and Boeing. According to the U.S. Department of Defense's fiscal year 2023 report, Lockheed Martin received $61.4 billion in contracts, Raytheon (now known as RTX) received $24.1 billion, and Boeing received $20.1 billion. In 2021, 71% of Lockheed Martin's revenue came from U.S. government contracts, while nearly 50% of Raytheon and Boeing's annual sales also came from the government.
Picture source note: The picture is generated by AI, and the picture authorization service provider Midjourney
However, it is unclear whether this alliance of technology companies can improve the current situation. Palantir has become the preferred supplier of AI systems to the U.S. Department of Defense. It recently received a $100 million contract to develop military AI target identification tools and received $480 million to expand the Department of Defense’s data analysis and decision-making tools. . Palantir’s technology has been involved in some controversial projects, including Immigration and Customs Enforcement efforts during the Trump administration that led to the separation of many families. The company's technology has also played an important role in Israel's ongoing offensive in Gaza, which has killed more than 45,000 people.
Called "tech's most controversial startup" by Bloomberg, Anduril is building sensor towers for the U.S.-Mexico border to track migrants and exploring the development of autonomous weapons. Anduril's core business is building war drones, but it also plans to build surveillance satellites, moves that raise many ethical questions. OpenAI recently announced a partnership with Anduril to develop a counter-drone system, which could be just the beginning of more collaborations to come. However, the agreement caused turmoil within OpenAI, with many employees not wanting to be involved in defense work.
Moreover, Peter Thiel's influence is everywhere. As the founder of Palantir, co-founder of OpenAI, major investor in Anduril, and an early investor in SpaceX, Thiel’s philosophy is often summarized as “prioritize technological progress regardless of human cost.” His biographer, Max Chafkin, has said Thiel's power, which combines a hostility to democracy and institutional norms with the financial power of a wealthy man, could do some damage. As a result, the nefarious behavior of traditional defense contractors appears to be relatively less severe.
Highlights:
1⃣ Technology companies such as SpaceX, Palantir and OpenAI are forming an alliance and plan to compete for US defense contracts to challenge traditional defense giants.
2⃣ The application of technology by companies such as Palantir and Anduril in the defense field has triggered many ethical controversies, especially on sensitive issues such as immigration and war.
3⃣ Peter Thiel’s influence runs through these companies, and the concepts of technological progress he promotes have triggered deep thoughts on national security and ethics.
The participation of technology companies in competition for defense contracts not only brings the possibility of technological innovation, but also raises concerns about ethical responsibilities and potential risks. In the future, the trends of this alliance and its impact on the defense industry deserve continued attention.