It’s still not a lot. How much do tokens cost for example?

In theory if it’s just labor with some profit mixed in, then you might be looking at 600 employees for each company.

I doubt it is just labor. Quote says $200 million ceiling. So maybe a time and materials (T&M) contract? It’s a ceiling so it’s not like they earn or are guaranteed $200m.

Has to include token or cloud computing time too. Which Google owns and can amortize themselves since it’s a capital asset to them. I don’t know much about the cloud computing background of Anthropic or if they are using Azure or AWS.

I think my original point is still valid it’s not a lot when you look at it

It will be enough to deliver the requirements for the DoD. They don’t need to spend any more or any less than what is required. Your point seems irrelevant if you don’t know their exact requirements.

It’s a $200m ceiling and my point was that it’s not a lot of money considering how other DoD contracts pay like CPIF type rates.

Meaningless comparison. If xAI or Google accepts the contract, they intend to deliver within the budget. You can't say whether it's too much or too little without knowing all of the details, which you don't.

It's on the DoD contracts site. I was a little off. It is a FFP style contract. Here is the OpenAI one (https://www.defense.gov/News/Contracts/Contract/Article/4218...)

"OpenAI Public Sector LLC, San Francisco, California, has been awarded a fixed amount, prototype, other transaction agreement (HQ0883-25-9-0012) with a value of $200,000,000. Under this award, the performer will develop prototype frontier AI capabilities to address critical national security challenges in both warfighting and enterprise domains. The work will be primarily performed in the National Capital Region with an estimated completion date of July 2026. Fiscal 2025 research, development, test and evaluation funds in the amount of $1,999,998 are being obligated at time of award. Office of the Secretary of Defense Chief Digital and Artificial Intelligence Office, Washington D.C., is the contracting activity. "

It's a prototype and its FFP. Only about $2m has been allocated to them. That equates to about 1-2 employees for a year.

Anthropic’s is “is expected to mirror OpenAI’s structure: a similar token obligation at signing and the rest released via milestones.”

All these frontier AI OTAs follow the same pattern of “up to [X] million” ceilings with actual funding phased out as projects progress. This mirrors what Palantir got last year.

Link: https://www.nextgov.com/defense/2024/06/pentagons-ai-office-...

Nice, should be enough for them to outbid Meta to retain 1 employee (https://news.ycombinator.com/item?id=44308000)