Microsoft, U.S. Army Strike Nearly $22 Billion Headset Deal
By Sarah E. Needleman
Microsoft Corp. has agreed to build custom augmented-reality
headsets for the U.S. Army in a deal worth up to $21.9 billion,
expanding the technology company's role as a major government
The devices will be based on Microsoft's HoloLens headset that
made its debut in 2016, the company said in a blog post Wednesday.
More than 120,000 units of the custom gear will be delivered over a
10-year period and supported by Microsoft's Azure cloud-computing
service. The headsets will help keep America's soldiers safer and
make them more effective, Microsoft said, in part by enhancing
their situational awareness and providing training
In a statement, the U.S. Army called Microsoft an "industry
leader in developing innovative technology" and its partnership
with the company "illustrates areas that the Department of Defense
and industry can work together toward achieving modernization
priorities in the interest of national security."
CNBC earlier reported the deal's value.
Augmented reality, known as AR, overlays digital content onto a
person's view of the real world. AR headsets have been gaining
popularity as a resource for workers in industries such as retail,
healthcare and automotive manufacturing. Microsoft competes in the
space with several dozen companies, including Alphabet Inc.'s
Google and Magic Leap Inc.
The technology industry considers AR the next major computing
interface. Facebook Inc. earlier this month announced plans to make
AR glasses for consumers and this week "Pokémon Go" creator Niantic
Inc. hinted that it is developing a pair as well.
Microsoft has struck deals to provide products and services to
the U.S. government before. In 2019, the company won a landmark
cloud-computing contract with the Pentagon worth up to $10 billion
over the next decade, beating out Amazon.com Inc., which had been
widely seen as the front-runner. Also that year the U.S. government
awarded a 10-year $7.6 billion Pentagon contract to General
Dynamics Corp. that included replacing existing IT systems with
Microsoft's Office 365.
The new deal with the U.S. Army comes after Microsoft in 2018
won a $480 million contract to supply it with 100,000 HoloLens
headsets. With new devices designed specifically for soldiers, "the
suite of capabilities leverages existing high-resolution night,
thermal, and Soldier-borne sensors," the Army said. The headsets
will also help soldiers make informed decisions as they confront
current and future adversaries, it said.
Write to Sarah E. Needleman at email@example.com
(END) Dow Jones Newswires
March 31, 2021 17:05 ET (21:05 GMT)
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