Microsoft scores U.S. Army contract to produce augmented reality headsets

Hololens Us Army 2021 Microsoft Press
Hololens Us Army 2021 Microsoft Press (Image credit: Microsoft)

What you need to know

  • Microsoft has won a contract to produce augmented reality helmets for the U.S. Army.
  • The contract could net Microsoft up to $21.88 billion over 10 years.
  • This is the latest in a series of contracts Microsoft has signed on for with the U.S. military.

Update: Microsoft has also confirmed and published the news themselves (opens in new tab).

According to CNBC, The Pentagon has announced Microsoft as the winner of a contract that will task the tech giant with constructing more than 120,000 augmented reality headsets for the U.S. Army. A Microsoft spokesperson who spoke with CNBC stated the contract could be worth up to $21.88 billion over ten years.

The augmented reality headsets in question are modified versions (opens in new tab) of Microsoft's consumer and business-friendly HoloLens headsets. While the standard HoloLens headsets overlay real-life environments with holographic imagery, the military variants add a map, compass, and thermal imaging capabilities, as well as the ability to project the aim of weapons. The Army-ordered HoloLens model is referred to as the Integrated Audio Visual System (IVAS).

This new contract isn't a complete surprise given that Microsoft was tasked with developing and delivering prototype military augmented reality headsets in 2018, as reported by Bloomberg. Said prototype contract caused backlash within Microsoft, as employees cited ethical concerns over using the HoloLens technology for military purposes. However, Microsoft forged ahead with the deal, thereby paving the way for today's news.

These aren't the only deals Microsoft has struck with the U.S. government's military-focused branches. In 2019, Microsoft won the Joint Enterprise Defense Infrastructure (JEDI) contract to provide cloud services for the U.S. Department of Defense. Microsoft engaged in quite the fight with Amazon for the contract but ultimately secured it. That deal has the potential to be worth $10 billion over the course of ten years. Another contract named Defense Enterprise Office Solutions, or DEOS, which is worth $7.6 billion was also awarded to General Dynamics Corp to deploy Microsoft Teams to the DOD.

Robert Carnevale

Robert Carnevale is the News Editor for Windows Central. He's a big fan of Kinect (it lives on in his heart), Sonic the Hedgehog, and the legendary intersection of those two titans, Sonic Free Riders. He is the author of Cold War 2395. Have a useful tip? Send it to

  • Grats. That's a pretty great contract considering I've seen so many people dismiss Hololens as a failure.
  • Our first step to real MJOLNIR armor in the military.
  • But Microsoft is worried about Georgia election laws? Give me a break. Stop posturing and keep doing what you're good at doing like making a freaking holographic helmet for soldiers and running the PlayStation out of town.
  • Biden didn't know... Delaware voting laws are more stringent than those signed into law in Georgia. Maybe Microsoft doesn't know either.
  • Yeah, his comments are pretty funny given the context. Of course, the point is to criticize and demonize the other side, not actually enact reasonable policy or truly evaluate the merits of any existing policies.
  • Oh? They don't let people bring food or water to people in line there either? Do they also have a process in place that the state legislators Can overturn the security of state if they don't like the outcome?
  • Did you read the law or are you just spouting the activist talking points? Nothing in the law prevents people from bringing water and it actually recommends that there be self service water receptacles within 150 feet of the polling location. All it bans is outside groups from handing our food and water to people in line. You're already not allowed to campaign within that distance and outsiders being allowed to give it out to those in line can be easily abused by campaigns to garner more votes. Imagine someone giving out water and food in exchange for someone's vote.
  • Woo, now the innocent civilians they kill can actually look like soldiers! Before you all flip out, I'm just joking, so put down your eagles mounted with AR-15's.
  • I hope we get a consumer windows 10x phone to power a surface version ar hololens glasses.
  • Thank you Microsoft for pushing my MVIS shares up 50%. Just the beginning. If I'm not mistaken the IVAS has an 80°fov as opposed to the 43° for the hololens 2. Should be the new benchmark for future iterations.
  • They don't need HoloLens to fly drones now do they.