Anduril, the California-based defence technology company founded by VR pioneer Palmer Luckey, has entered into an agreement with Microsoft to take control of the troubled military AR projects known as the Integrated Visual Augmentation System (IVAS).
IVAS, which began in 2018, is the US Army’s ambitious effort to equip soldiers with augmented reality (AR) headsets designed to enhance situational awareness and decision-making on the battlefield. The project initially used hardware based on Microsoft’s now-discontinued HoloLens headsets, but progress has been marred by delays, technical issues, and mounting concerns over the programme’s viability.
Microsoft and Anduril announced today that the new partnership will see Anduril “assume oversight of production, future development of hardware and software, and delivery timelines” for IVAS—a shift in roles that will allow Microsoft to step back from hardware development and focus on providing cloud infrastructure and AI support through its Azure platform. The agreement is subject to approval from the US Department of Defense (DoD).
A promising AR project for the military in crisis
What began as a promising collaboration between Microsoft and the US Army has faced repeated setbacks.
In 2021, the Army signed a massive $22 billion deal with Microsoft to develop bespoke AR headsets, citing the potential of the technology to revolutionise modern warfare. However, by the end of that year, the rollout of the headsets was delayed without much explanation beyond vague commitments to “continue to enhance” the devices.
The following year, leaked reports revealed that soldiers testing the headsets suffered “mission-affecting physical impairments,” including headaches, eyestrain, and nausea. It became clear that the customised HoloLens devices in their current form were unsuited for operational use, prompting the Army to request design revisions.
Concerns about the project ran deeper than the hardware issues. Early in the programme, some Army officials questioned whether IVAS was even necessary, a scepticism later echoed by the DoD’s own Inspector General, who flagged the entire initiative as potentially wasteful.
By early 2023, Congress withdrew funding for the programme, stipulating that it would only finance new hardware that eliminated previous shortcomings.
Plans to test version 1.2 of the headsets were set for 2025, with a limited number of units undergoing testing in early 2024. However, the results of those tests have not yet been made public.
Assuming leadership
In light of these challenges, Anduril’s assumption of leadership on IVAS could mark a critical turning point.
Founded in 2017, Anduril has earned a reputation for innovative defence technologies, including counter-drone systems and AI platforms tailored to military needs. The company’s founder, Palmer Luckey, is best known for developing the Oculus VR headset, but his post-Oculus venture has focused exclusively on defence solutions.
Microsoft, meanwhile, has struggled to adapt its existing HoloLens technology for military purposes, and its redefined role in the IVAS programme signals an attempt to play to its strengths in cloud computing and AI. As part of the new agreement, Anduril will designate Microsoft Azure as its preferred “hyperscale cloud” to support AI development and other workloads related to IVAS.
“Microsoft’s advanced cloud infrastructure and AI capabilities will continue to provide a robust backbone for the programme, enabling seamless data integration and real-time insights critical to soldier effectiveness,” the companies said in a joint statement.
Azure’s commercial, US government, and classified cloud services will bring “high resiliency, sophisticated capabilities, flexibility, and advanced security” to the programme, ensuring compliance with the stringent requirements for handling the nation’s most sensitive data.
Delivering a lifesaving AR capability for the military
Both companies remain publicly optimistic about IVAS’s future. Luckey described the programme as “the future of mission command,” stating that the collaboration seeks to create a “military ecosystem where technology acts as an extension of human capability.”
“The ultimate goal is to empower soldiers with the tools they need to make faster, smarter decisions,” Luckey said. “We’re building a future where technology and human ingenuity combine to ensure mission success.”
Robin Seiler, Microsoft’s Corporate Vice President for Mixed Reality, noted the significance of the partnership’s “soldier-centred design” approach, which incorporates real-world feedback from soldiers into product development.
“We are incredibly proud of the work our teams have put in to help the US Army transform its concept of a soldier-borne AR headset into reality with the IVAS programme,” Seiler said. “We are excited to partner with Anduril for the next phase of IVAS and leverage our combined strengths to meet our commitments on this vital programme and deliver a game-changing capability for every US soldier.”
Anduril and Microsoft have previously collaborated to integrate Anduril’s Lattice platform into IVAS, providing soldiers with AI-driven situational awareness tools to help counter threats such as drones and other emerging challenges on the battlefield. The expertise gained from this earlier partnership is expected to facilitate a smoother transition as Anduril takes the reins on programme development.
Addressing previous challenges
Critics of the IVAS programme will note that Anduril’s involvement alone is not a guaranteed solution to the issues that have plagued the initiative. Nonetheless, the company’s defence-focused expertise – particularly its innovative approach to integrating hardware, software, and AI for military use – could provide the fresh perspective needed to get the project back on track.
“The IVAS programme represents a groundbreaking step forward in military technology, providing soldiers with a comprehensive, body-worn system that integrates advanced augmented reality and virtual reality to give warfighters beyond line-of-sight perception capabilities, increasing combat effectiveness, survivability against drones, and accelerating mission command of unmanned systems,” explained Anduril.
That level of ambition underscores the scope of the challenge. The dynamic nature of modern battlefields demands unprecedented flexibility and technological capability. Traditional mission command systems – relying on static maps, dashboards, and verbal communication – are increasingly ill-suited to the demands of contemporary warfare. If successful, IVAS could set a new standard for how soldiers interface with information and make decisions in the field.
The success of the new arrangement will likely hinge on Anduril’s ability to address the shortcomings of IVAS while delivering a functional, scalable product at a lower unit cost. Anduril has expressed confidence in its ability to manufacture at scale without sacrificing the quality or precision required by military applications.
The stakes are high—not only for the companies involved but also for US taxpayers, who have watched billions of dollars already sunk into IVAS with little to show for it. The pivot to Anduril’s leadership represents both a hope for redemption and a stark reminder of the complexity involved in marrying cutting-edge technology with the harsh realities of military operations.
For now, all eyes are on Anduril as the company takes over one of the most ambitious – and controversial – defence projects in recent memory. Whether this partnership will finally deliver on the promise of battlefield-ready military AR remains to be seen.
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