(Bloomberg) -- Defense tech companies Palantir Technologies Inc. and Shield AI have signed an agreement for a new strategic partnership, a step toward developing autonomous flight with AI-powered intelligence and operational control.
The agreement will see the two defense contractors share key parts of their proprietary software as they race to deliver modern warfare capabilities and take advantage of the incoming Trump administration’s enthusiasm for Silicon Valley-backed companies.
At the signing attended by about a dozen company executives in New York on Thursday afternoon, Palantir Chief Executive Officer Alex Karp told Bloomberg News it was “very hard to get this far.”
Brandon Tseng, president and co-founder of closely held Shield AI, said pilotless aircraft will now be able to take into account not only what sensors can detect in the immediate vicinity but also data gleaned from much farther away.
“You’re going to see these systems start to do things on the battlefield that you previously haven’t seen,” Tseng, who also attended the signing, said in an interview.
Pairing Shield AI’s Hivemind autonomous system with Palantir’s real-time intelligence and operational picture from its Gaia and other platforms would speed up battlefield operations and make them more effective, he said.
The announcement came a day after Anduril Industries Inc. and OpenAI unveiled a partnership to work on anti-drone systems. Taken together, the moves highlight the growing importance of artificial intelligence to the US military as it seeks to maintain an edge over China and other adversaries.
In a sign of the threat China perceives from new drone technologies, Beijing on Thursday announced that it has imposed sanctions on Shield AI and 12 other US military companies, many of which participated in a trade mission to Taiwan in September. As part of that delegation, Shield AI said its autonomous drones dubbed V-BAT are capable of providing Taiwan’s armed forces with a “unique capability to establish maritime domain awareness in the South China Sea and beyond.”
Tseng told Bloomberg News the sanctions would have little impact on his company because it’s “intentionally” not reliant on China. He said the new sanctions indicate the US is on its way to developing “strong deterrence” that could prevent a major conflict.
Amid the growing US-China rivalry and tensions over Taiwan, the new defense-tech partnership also coincides with momentum to shift military spending toward advanced technologies and the companies behind them and away from multibillion-dollar weapons built by old-line defense contractors. It’s a sentiment shared by advisers to President-elect Donald Trump, including billionaire Elon Musk.
Shield AI has flown pilotless fighter jets and is supplying autonomous flight capabilities for the US Air Force, US Navy and others. Palantir’s AI-enabled battle data management systems draw on multiple Palantir data platforms and already form a key part of the Pentagon’s effort to bring artificial intelligence to the battlefield, known as Project Maven.
Palantir also has developed a new manufacturing operating system, known as Warp Speed, for use beyond defense industries that Shield AI will adopt to speed its own deliveries, said Shyam Sankar, Palantir’s chief technology officer.
Sankar said Palantir’s Warp Speed would help Shield AI “crank out the V-BATs” by streamlining the cost and speed of production for the drones and supply them at scale to all the combatant commands that need them.
The two companies have developed a closer working relationship over the past year with the help of Doug Philippone, a Shield AI board member and long-time Palantir adviser who made the initial outreach, according to Tseng.
Philippone said he had been drawn by a vision of combining Shield AI’s autonomy platform and Palantir’s ability to move around data.
Earlier: Palantir Wins $100 Million US Contract for AI Targeting Tech
Tseng says he’s excited that the incoming Trump administration could deliver on its promises to modernize the Pentagon and its labyrinthine contracting systems, praising the role that Musk, the world’s richest person, is set to play in driving government efficiency. Musk, who is due to co-lead a newly created Department Government of Efficiency, recently complained on his social media platform X that the Defense Department “gets terrible value for money.”
“Elon actually understands the complexity and the depth of these government acquisition problems,” Tseng said of Musk, who sued the Pentagon in order to win contracts. “He lived them with SpaceX.”
The prospects for the future of war are far from universally embraced. Ethicists have repeatedly expressed concern about the role of AI and lethal autonomous systems in combat, potentially empowered to make their own kill decisions without direct human intervention. United Nations Secretary-General Antonio Guterres called for a ban on lethal autonomous weapons by 2026.
In October, Mark Milley, the retired four-star Army general and former chairman of the Joint Chiefs of Staff, warned that the use of AI and robotics in war risked opening a Pandora’s Box.
Palantir and Shield AI contend that bringing AI and autonomy to the battlefield will help make targeting more precise and more speedy and help defend western allies.
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