Wealth Advisor Rockville, MD

The U.S. Army has selected Palantir Technologies, a Silicon Valley data analytics company founded by Trump adviser Peter Thiel, to deploy a complex battlefield system for soldiers. The lucrative contract is reportedly worth up to $800 million, according to The Washington Post.

According to Army documents seen by the outlet, the contract gives Thiel’s company the right to build the next phase of the Distributed Common Ground System (DCGS-A, for Army), which allows users to analyze a range of information about enemy movements and terrain, and create real-time reports on the date.

The news of the Army’s decision to go with Palantir ends the recent competition between between Palantir and major U.S. defense contractor Raytheon, the two companies that were vying for the Army’s next phase of the intelligence system. The choice the Silicon Valley company marks a big departure for the Army as Raytheon is the more traditional defense contractor.

The Post reports that both companies were allowed to test their unique software before an audience of soldiers, who were able to critique both presentations. Afterward, Palantir and Raytheon refined their work and came back with adjustments.

Doug Philippone, a former Army Ranger who heads up Palantir’s defense business, told the Post, “The Army changed its approach to acquisition.”

Philippone explained that Palantir believed it could win if able to adjust its technology after the critique. He explained that during the testing phase soldiers parachuted out of airplanes with reinforced laptops containing Palantir’s software.

According to its website, “Palantir Defense allows warfighters to interact with all of their data from all of their systems from a single point of access, in unprecedented ways. No matter where the data is being accessed, Palantir Defense’s global knowledge management capabilities track every read, write, and edit, preserving the accumulated knowledge of the battle space.”

This is the first time that Palantir, the venture-backed company, has been been contracted for a “defense program of record,” which is the biggest, multi-year project awarded by the Pentagon.

In 2016, Palantir was awarded a $222 million award from the Department of Defense’s Special Operations Command (SOCOM) for a technology and logistics software and support project called “All-Source Information Fusion,” intended to bring together intelligence and other information gathered by SOCOM, which oversees the special operations units of every branch of the U.S. military, reports CNBC.

According to Fox News, Maureen Stevens, a Raytheon spokeswoman, said, “While we are disappointed in the Army’s decision on this initial delivery order, it represents a relatively small number of systems. We will actively compete for future delivery orders as we continue to work closely with the Army to help them meet their intelligence needs.”

The spokesperson also added that Raytheon while losing this contract, the company was awarded a DCGS-A 10-year contract last March, which is part of the Army’s “multiple delivery” plan.

The Pentagon did not immediately respond to CNBC’s request for comment.

In 2003, Thiel co-founded Palantir, which is now valued at $20 billion, and was the company’s largest shareholder as of 2015. He was a prominent supporter of Trump during the 2016 presidential campaign, informally advising the administration on technology and science since Trump has been in office. Thiel has also vocally pledged to support Trump’s bid for reelection in 2020.

Alexander Karp is the CEO of Palantir Technologies Inc.

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