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Microsoft wins $480M contract to supply US Army with HoloLens

Augmented reality glasses could someday be used in combat missions.

A man wears Microsoft's HoloLens AR headset.

Microsoft has struck a deal to supply HoloLens to the US Army.

Claudia Cruz/CNET

Microsoft has been awarded a $480 million contract to supply the US Army with prototype HoloLens augmented reality systems for use in combat missions and training, according to a filing with the General Services Administration.

The contract could eventually lead to the military purchasing over 100,000 AR headsets as part of a program to "increase lethality by enhancing the ability to detect, decide and engage before the enemy," according to Bloomberg, which reported the news earlier Wednesday. AR headset rival MagicLeap was also reported to have been bidding for the Army's contract.

"Augmented reality technology will provide troops with more and better information to make decisions," a Microsoft spokesman said in a statement. "This new work extends our longstanding, trusted relationship with the Department of Defense to this new area."

The deal comes as big tech companies' work with the US military has raised questions among their employees about the ethics of supplying technology that will be used in warfare. In October, Google walked away from bidding on a huge Defense Department project because of employee objections to the company's prior involvement with Project Maven and the possibility that the project may not align with Google's principles for ethical use of artificial intelligence.

Microsoft legal chief Brad Smith defended the company's bidding on that project, which involves moving massive amounts of Pentagon internal data and processing power to a commercially operated cloud system.

"We want the people of this country and especially the people who serve this country to know that we at Microsoft have their backs," Smith wrote in a blog post.

Unlike virtual reality, which immerses goggle-wearing users in digital worlds, AR overlays images and data atop views of the real world.

There are a handful of VR headsets out there, like Google Daydream ViewOculus Go and Samsung Gear VR, but not as many AR devices. Microsoft's HoloLens is one of the few, but companies like GoogleApple and Samsung are rumored to be working on their own.

Representatives for the Army didn't immediately respond to a request for comment.

First published Nov. 28 at 5:08 p.m. PT.
Update at 5:31 p.m.: Added Microsoft statement.

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