What changed in pricing
The bargain-basement trial is ending. OpenAI will replace the $1-per-year arrangement for federal agencies with pay-as-you-go pricing, while keeping costs down for workers in government by offering a 50% cut from list prices. The General Services Administration says the updated agreement kicks in on October 1 and runs for more than two years. The discounted rate is intended to support agencies in piloting and expanding AI, with support for the company's new GPT-6 Astra model included.
How the $1 year performed
To kickstart adoption, OpenAI joined the GSA's OneGov marketplace in August of last year so agencies could buy AI software in bulk. Bloomberg previously reported that the inaugural year's $1 terms were the steepest tech discount the GSA had ever landed. Over that span, the GSA reports that OpenAI's ChatGPT was accessible to 3.5 million federal employees, and the government ties $1.4 billion in cost savings to ChatGPT and other AI models.
The Anthropic subplot in Washington
Not long after, a clash emerged with the Pentagon over the company's desired rules around surveillance and autonomous strike limits in national security contracts. Defense Secretary Pete Hegseth subsequently labeled Anthropic a supply-chain risk, and President Donald Trump used his Truth Social account to tell agencies to stop using Anthropic.
Anthropic sued the U.S. government. Because those cases are still active, it is unclear whether agencies without a national security mission will ultimately discontinue Anthropic's products. At first, the GSA instructed purchasers to take Anthropic off its main AI catalog, but it later reversed that position following a California judge's preliminary injunction.
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Last month, that judge ordered the Trump administration to lift its block on federal agencies using Anthropic's AI, suggesting the Pentagon can bar the tech in its own work but may lack the power to impose that on other departments. A separate case continues in a Washington court, where a three-judge panel has not yet ruled on another legal claim.
What to watch next
OpenAI says the new discount is built to lower the hurdles to pilot and expand AI across government, and it plans to roll the same pricing to state, local and tribal entities, with a formal announcement expected Thursday. Back in February, OpenAI also said it reached a deal to make its tools available to the Pentagon. For everyday investors, the takeaway is simple: government tech spending can pivot quickly from teaser deals to usage fees, and court fights can reshape which vendors win access.
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