RESOLVING THE LEDGER
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Emil Michael led the Pentagon’s negotiations with Anthropic over military AI safety guardrails, attempting to strongarm one of the world’s fastest-growing companies into accepting terms it deemed unacceptable. When Anthropic refused in February, Michael helped trigger an unprecedented reaction: designating it a supply chain risk—the first time the label has been applied to an American outfit.
Michael, a former Uber executive, was no stranger to dealmaking. A decade ago, he led the negotiations behind the ride-hailing business’s $3.5 billion Saudi investment and helped close its historic deal with Didi in China. After taking charge of the Pentagon’s AI portfolio last August, Michael said he inherited Biden-era contracts burdened by “25 pages of restrictions” that prevented basic military activities. He pushed providers to permit “all lawful uses” of their models.
Anthropic has said the dispute came down to two exceptions: keeping Claude from conducting mass surveillance of Americans and from independently controlling lethal autonomous weapons. Michael rejects that account, saying Anthropic instead wanted the Pentagon to seek its approval for particular uses of Claude, effectively inserting the company into the military chain of command. Anthropic has called that characterization “patently false.”
After negotiations failed, the Pentagon imposed the supply chain risk designation. “They turned it into a PR thing,” Michael told TIME in March . “When you do that, you are a supply chain risk.” Though Michael did not persuade Anthropic, he won the broader fight. OpenAI, xAI, and Google subsequently reached agreements allowing the Pentagon to deploy their models under terms closer to those he had laid out.
Disclosure: Investors in Anthropic include Salesforce, where TIME owner and co-chair Marc Benioff is CEO
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