Anthropic Just Sold AI to the Entire US Government for $1 (Not a Typo)

4IR - Daily AI News

Welcome back to 4IR. Here's today's lineup:

• Anthropic offers Claude to all 3 branches of government for $1 - the federal AI land grab intensifies

• Elon threatens Apple with "immediate legal action" over App Store rankings - Grok ranked #5 but excluded from "Must Have" list

• YouTube's AI age verification goes live, 50,000 creators revolt - when behavioral analysis overrides your birthdate

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🔥 TOP STORY: Anthropic's $1 government gambit upends OpenAI

The story: Anthropic announced on August 12 that Claude for Government is available to all three branches of the U.S. government—legislative, judiciary, and executive—for $1 per agency annually. This broader offering surpasses OpenAI's executive branch-only ChatGPT Enterprise deal from August 6. The symbolic pricing signals Anthropic's aggressive push for federal adoption, leveraging FedRAMP High certification and multi-cloud deployment through AWS, Google Cloud, and Palantir partnerships.

What we know:

• $1 annual pricing per agency across all three branches

• FedRAMP High certification already secured

• Multi-cloud deployment (AWS, Google Cloud, Palantir)

• Competes with OpenAI's GSA partnership from August 6

• Claude conversation memory feature launched same day

• GSA added Claude, Gemini, ChatGPT to Multiple Award Schedule August 5

Why it matters: This isn't about the dollar—it's about establishing Claude as the default federal AI. Anthropic is betting that once agencies integrate Claude into workflows, switching costs will lock them in regardless of future pricing. The three-branch access gives Anthropic reach OpenAI doesn't have, potentially influencing how Congress writes AI legislation and how courts interpret it.

The race to capture government contracts isn't just about revenue—it's about shaping policy from the inside. Whoever owns federal AI adoption writes the rules everyone else follows.

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💰 PLATFORM WARS: Musk threatens Apple over Grok's App Store treatment

The story: Elon Musk threatened "immediate legal action" against Apple on August 12, claiming antitrust violations after his xAI app ranks #5 overall but doesn't appear in Apple's curated "Must Have Apps" section where ChatGPT holds the #1 spot. The dispute escalated after Grok was briefly suspended from X platform for 15 minutes when it stated "Israel and the US are committing genocide in Gaza," with Musk calling his own platform's suspension a "dumb move."

What we know:

• Grok ranks #5 overall on App Store

• Excluded from "Must Have Apps" editorial section

• ChatGPT maintains #1 position in curated lists

• Grok suspended from X for controversial Gaza statement

• 15-minute suspension, golden checkmark removed

• Musk preparing antitrust lawsuit against Apple

Why it matters: Musk is learning what every AI company already knows: distribution is destiny. Apple's App Store curation effectively picks winners, and no amount of Twitter integration can overcome that gatekeeping. The Grok suspension on his own platform reveals deeper tensions—even Musk can't control content moderation at scale.

The irony is delicious: the "free speech absolutist" had his own AI censored on his own platform while complaining about censorship on someone else's. Welcome to the platform paradox.

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🤖 TECHNICAL BREAKTHROUGH: YouTube's AI knows you're lying about your age

The story: YouTube launched its AI-powered age verification system on August 13, analyzing viewing habits, search history, and behavioral patterns to identify users under 18 regardless of stated birthdate. The system requires flagged users to verify age through government ID, credit card, or facial recognition. Creators are organizing widespread opposition to what they call "AI spying," with adult content creators reporting misclassification for watching animated content.

What we know:

• Analyzes viewing patterns to detect actual age

• Overrides self-reported birthdates

• Requires ID/credit card/facial recognition verification

• Creators organizing opposition campaigns

• Adult creators flagged for watching animation

• Rolling out to US users starting August 13

Why it matters: This crosses a new line—AI making determinations about who you are based on behavior, not declaration. YouTube's system sets a precedent where platforms can override user-provided data with algorithmic inference. Today it's age verification, tomorrow it's inferring political affiliation, mental health status, or creditworthiness.

We've entered the era of behavioral authentication where the algorithm knows you better than you know yourself. The question isn't whether this works—it's whether we want it to.

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🛠️ HOW-TO: Give AI perfect memory of your business (using Claude Projects)

Tired of explaining context every time you chat with AI? Here's how to create an AI that knows everything about your company:

What Claude Projects does for you:

• Upload all your docs, strategies, brand guides once

• AI remembers everything across all conversations

• Set custom instructions it always follows

• Share knowledge base with your team

5-Minute Setup:

1. Open Claude – Go to claude.ai and click "Projects" in sidebar (Pro subscription required)

2. Create project – Click "Create Project" and name it (e.g., "Company Brain" or "Q4 Marketing")

3. Upload your docs – Drag in everything: PDFs, docs, spreadsheets, presentations. Up to 200MB or 500 pages per project

4. Set instructions – Add project rules like "Always use our brand voice" or "Reference our pricing from the rate card"

5. Start chatting – Every conversation in this project knows all your uploaded context. No more copy-pasting.

Real user applications:

• Founders – Upload pitch deck, financials, strategy docs for instant investor email drafts

• Marketers – Add brand guidelines, past campaigns, audience research for consistent content

• Consultants – Create separate project per client with all their materials

• Product teams – Upload PRDs, user research, roadmaps for feature planning

• Legal teams – Add contracts, precedents, policies for quick clause drafting

Pro tips:

• Name files clearly - Claude references them by filename

• Update docs weekly to keep context fresh

• Use multiple projects to separate clients/departments

• Share project link with team for consistent AI responses

Pricing for Projects feature:

• Free – No Projects feature

• Pro ($20/month) – Unlimited Projects, 200MB each

• Team ($25/user/month) – Shared Projects, central billing

This turns Claude into your company's second brain—one that never forgets a detail and works 24/7.

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⚡ QUICK HITS

• OpenAI releases first open-source models since 2019: GPT OSS 120B fits on single GPU

• Skywork's Matrix-Game 2.0 enables 25 FPS real-time world generation, fully open-sourced

• Federal agencies get ChatGPT, Claude, and Gemini added to procurement schedule

• AI productivity paradox: Developers 19% slower despite believing 24% faster per METR study

• n8n jumps from $350M to $2.3B valuation in 4 months as enterprises chase AI automation

• Healthcare AI adoption hits 88% with 34% ROI and 14.7-month payback periods