AI Giants Offer $1/Year Deals to Federal Employees
In a bold move that has sent ripples through the technology sector, leading artificial intelligence developers OpenAI and Anthropic are offering their advanced AI models to the U.S. federal government for the astonishing price of just $1 per year. This strategic maneuver, facilitated by the General Services Administration (GSA), marks a significant escalation in the race to embed cutting-edge AI capabilities within the nation’s vast federal workforce.
OpenAI initiated the trend by making ChatGPT Enterprise available to federal agencies for a nominal $1 annually, sweetened with 60 days of unlimited access to advanced models. Not to be outdone, Anthropic swiftly followed suit, offering its Claude for Enterprise and Claude for Government models at an identical price point for a full year across all three branches of government. These deals are part of the GSA’s Multiple Award Schedule, a streamlined path designed to accelerate the adoption of AI tools like OpenAI’s ChatGPT, Anthropic’s Claude, and Google’s Gemini within the federal marketplace.
The GSA views these agreements as a pivotal step towards modernizing government operations, aiming to revolutionize employee and citizen experiences by putting powerful AI tools directly into the hands of federal workers. Stephen Ehikian, GSA Deputy Administrator, highlighted that this push directly translates President Trump’s “AI Action Plan” into tangible action, accelerating AI adoption across government to boost security and global leadership. Launched in July 2025, the “Winning the Race: America’s AI Action Plan” outlines a comprehensive strategy focused on accelerating AI innovation, building domestic AI infrastructure, and asserting U.S. leadership in international AI diplomacy and security. Further supporting this vision, the GSA recently unveiled USAi.Gov, a centralized, secure generative AI evaluation suite, allowing agencies to explore, interact with, and adopt secure AI services at no cost.
However, the seemingly irresistible “$1 a year” offers are not without their critics. Experts, including Nicolas Chaillan, former chief software officer of the U.S. Air Force, have voiced significant concerns about the potential for vendor lock-in. While these low introductory prices remove immediate cost barriers and allow federal agencies to experiment with advanced AI, there’s a looming question of what happens when the first year expires and the price inevitably escalates. Critics argue that such deals undermine fair competition, disregard commercial pricing norms, and could leave agencies vulnerable to exorbitant renewal costs without transparent pricing guarantees.
For the AI giants, these aggressive pricing strategies are a calculated gamble. By securing early adoption within the federal ecosystem, they aim to gain a strategic foothold, build trust, and potentially influence the development of future government AI policies and standards. This intense competition for government business extends beyond these $1 deals, with companies like OpenAI, Anthropic, Google, and xAI already securing substantial Department of Defense contracts to apply AI to national security challenges. The federal government, the world’s largest buyer of goods and services, represents a massive and influential market, with AI spending rapidly outpacing traditional IT investments in recent years.
As the federal government continues its push to integrate AI, with agencies exploring its use for everything from fraud detection and grant review to customer service and national security, the Office of Personnel Management (OPM) is also actively working to prepare the federal workforce through training initiatives and new hiring guidance. This dual focus on rapid technological adoption and workforce readiness underscores a broader national effort to maintain a competitive edge in the global AI landscape, even as the industry grapples with the ethical and economic implications of such unprecedented deals.