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With the contract, the US Army immediately becomes one of Microsoft's most important HoloLens customers. It expects devices to vary from their consumer-grade counterparts in a handful of key respects. In a document shared with companies bidding on the contract, the Army said it wanted to incorporate night vision and thermal sensing, measure vital signs like breathing and "readiness," monitor for concussions and offer hearing protection. It said the winning bidder would be expected to deliver 2500 headsets within two years, and exhibit the capacity for full-scale production.

The contract went through a bidding process designed to encourage the Army to do business with companies who aren't traditional defense contractors. Magic Leap, which makes the main competitor to HoloLens for the consumer market, also pursued the contract. In early August, the Army held meetings with 25 companies interested in participating in some way, including Booz Allen Hamilton Holding, Lockheed Martin, and Raytheon. The technology industry's cooperation with the US military and law enforcement has become increasingly tense over the last year, with employees at companies like Google and Amazon pushing back against government contracts.

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Earlier this year, hundreds of Microsoft workers signed a petition criticising a contract with US Immigration and Customs Enforcement that Microsoft had originally said included some of its AI software. In October, a blog post purportedly written by Microsoft employees urged the company not to bid on a multi-billion dollar US military cloud contract. "Many Microsoft employees don't believe that what we build should be used for waging war," they wrote.

Later that month, Microsoft's President and Chief Legal Officer, Brad Smith, said the company would continue to sell software to the US military. Smith wrote that employees with ethical qualms with projects would be allowed to move to other work within the company.

"Artificial intelligence, augmented reality and other technologies are raising new and profoundly important issues, including the ability of weapons to act autonomously. As we have discussed these issues with governments, we've appreciated that no military in the world wants to wake up to discover that machines have started a war," Smith wrote. "But we can't expect these new developments to be addressed wisely if the people in the tech sector who know the most about technology withdraw from the conversation."

Bloomberg