The dispute between Anthropic and the Department of Defense has escalated in recent days, with officials publicly trading barbs with the AI company on social media.

Defense Secretary Pete Hegseth met with Anthropic’s CEO, Dario Amodei, earlier this week. He gave the company until Friday to commit to changing the terms of its contract to allow “all lawful use” of its models. Hegseth praised Anthropic’s products during the meeting and said that the Department of Defense wanted to continue working with Anthropic, according to one source familiar with interaction who was not authorized to discuss it publicly.

Some experts say that the dispute boils down to a clash over vibes rather than concrete disagreements over how artificial intelligence should be deployed. “This is such an unnecessary dispute in my opinion,” says Michael Horowitz, an expert on military use of AI and former Deputy Assistant Secretary for emerging technologies at the Pentagon. “It is about theoretical use cases that are not on the table for now.”

Horowitz notes that Anthropic has supported all of the ways the Department of Defense has proposed using its technology thus far. “My sense is that the Pentagon and Anthropic agree at present about the use cases where the technology is not ready for prime time,” he adds.

Anthropic was founded on the idea that AI should be built with safety at its core. In January, Amoedi penned a blog post about the risks of powerful artificial intelligence that touched upon the dangers of fully autonomous AI-controlled weapons.

“These weapons also have legitimate uses in the defense of democracy,” Amodei wrote. “But they are a dangerous weapon to wield.”

Additional reporting by Paresh Dave.

This story originally appeared at WIRED.com

https://arstechnica.com/tech-policy/2026/02/trump-moves-to-ban-anthropic-from-the-us-government/

A successful Paramount-WBD merger would be the largest streaming merger ever and would lead to further consolidation in the industry.

“What started as a fragmented but flexible streaming ecosystem is increasingly trending toward rebundling—fewer, larger super-platforms offering broader catalogues at higher price points,” Mathur said.

Paramount holds on to cable

Paramount’s WBD bid is unique in its aggressive push for cable channels, which are struggling with viewership and advertising revenue. Under a WBD merger, Paramount would add networks like HGTV, Cartoon Network, TLC, and CNN to its linear TV lineup, which currently includes Comedy Central, Nickelodeon, and CBS.

Although Paramount and WBD’s cable businesses are both in decline, they are both profitable. Paramount’s TV/media business, which includes its cable channels and production studios, reported $1.1 billion in adjusted OIBDA in Q4 2025. WBD’s cable business posted adjusted EBITDA of $1.41 billion that quarter.

Ultimately, a Paramount-WBD merger would put diversity of viewpoints at risk. Under Ellison’s ownership, CBS News has adjusted its approach with new editor-in-chief Bari Weiss. There have also been concerns about censoring CBS under Ellison’s Paramount, including from Stephen Colbert, who said this month that CBS forbade him from interviewing Texas Democratic Senate candidate James Talarico; CBS denied Colbert’s claim. Further, Paramount could have a lasting impact on CNN, including costs, layoffs, and coverage.

More to come

Regulatory scrutiny will be at the center of Paramount and WBD’s merger over the upcoming months. Federal approval is likely, but the merger also faces European regulation and potential state lawsuits. The theater industry is also lobbying against Paramount’s WBD merger.

Should a Paramount-WBD merger ultimately be greenlit, two declining businesses will be challenged to form a profitable one. Even with regulatory approval, Paramount-Skydance-Warner-Bros.-Discovery faces an uphill climb.

Although the bidding war may be settled, the fight for WBD is only beginning.

https://arstechnica.com/gadgets/2026/02/under-a-paramount-wbd-merger-two-struggling-media-giants-would-unite/

The US military mistakenly shot down a Customs and Border Protection (CBP) drone near the Mexican border in a strike that reportedly used a laser-based anti-drone system. The CBP uses drones to track people crossing the border.

“Congressional aides told Reuters the Pentagon used the high-energy laser system to shoot down a Customs and Border Protection drone near the Mexican border, in an area that often has incursions from Mexican drones used by drug cartels,” Reuters reported last night.

The FAA closed some airspace along the border with Mexico in Fort Hancock, Texas, on Thursday with a notice announcing temporary flight restrictions for special security reasons. The restrictions are in place until June 24 but could be lifted earlier. There are conflicting reports on which day the strike happened, with The New York Times reporting that the strike occurred Thursday and Bloomberg writing that the Federal Aviation Administration (FAA) “was notified Wednesday after the event occurred.”

“The Defense Department didn’t realize the drone was being flown by CBP when it shot it down,” and “had not first coordinated the use of the laser system with the US Federal Aviation Administration,” Bloomberg wrote, citing anonymous sources.

The military hasn’t been coordinating counter-drone measures with the FAA, and “CBP drone operators didn’t inform the military’s laser unit that it was launching,” Bloomberg wrote, citing anonymous sources. Because the CBP didn’t notify the Defense Department, the military viewed the aircraft as “an unknown drone,” the Times wrote, citing an unnamed Pentagon official.

Two laser strikes in February

The latest incident came about two weeks after the FAA abruptly closed airspace over El Paso for a few hours, leading to flight cancellations. In the early February incident, CBP was the one that fired the laser. The CBP was “using the same technology on loan from the military to combat drug-smuggling” and “fired a high-energy laser at what they thought was a drone,” but turned out to be a party balloon, the Times wrote.

“In both cases, the lasers were used without the FAA’s approval, which many aviation safety experts maintain is a violation of the law,” the Times wrote.

Democratic lawmakers criticized the Trump administration. “The Trump administration’s incompetence continues to cause chaos in our skies,” Sen. Tammy Duckworth (D-Ill.), ranking member of the Senate Aviation Subcommittee, said in a statement provided to Ars. Duckworth said, “The situation is alarming and demands a thorough, independent investigation.”

https://arstechnica.com/tech-policy/2026/02/whoops-us-military-laser-strike-takes-down-cbp-drone-near-mexican-border/

“Calling it gambling because a user could, through several indirect steps, convert an item into cash risks stretching gambling law beyond its traditional limits,” Loiterman said. “If New York’s theory wins, it raises uncomfortable questions about things like Pokémon cards or promotional games (e.g. McDonald’s Monopoly). Courts will be cautious about going that far.”

New York also argues that Valve tacitly endorses third-party services that allow players to easily “cash out” their Steam inventories for real money. Whether Valve is culpable for the existence of those services is still an unsettled question in the law, Methenitis said, as it has been at least since he wrote about the legal implications of World of Warcraft‘s third-party gold resellers nearly two decades ago.

“I think companies have a pretty strong [legal] argument if they make some attempts to police [third-party resellers]—they obviously can’t fully control what people do outside their platform,” Methenitis said. “But if they turn a blind eye to it and allow it, I think they could be found liable.” Loiterman agreed that Valve “providing the tools that enable those [third-party] markets and tolerating them creates some degree of responsibility.”

“Judges tend to be cautious…”

In the end, the lawyers Ars spoke to were generally skeptical that courts would determine that Valve’s loot box system constitutes illegal gambling. Cases making similar arguments about other loot box systems have failed in other jurisdictions, “in part because gambling laws were drafted with casinos and lotteries in mind,” Loiterman said. “Judges tend to be cautious about breaking from an emerging consensus.”

Hoeg agreed that “the entire question [in this case] is novel, and… the courts are (small-‘c’) conservative institutions, not generally wanting to adopt novel arguments without direction from the legislative branches.” Even if Valve’s loot box system “may start to smell a bit like gambling,” Hoeg said he would “honestly be surprised if the courts went along with the characterization without a new law aimed at it.”

“I view it as a weak case offered primarily for political grandstanding/coverage over real legal effect,” Hoeg concluded. “We shall see, though.”

https://arstechnica.com/gaming/2026/02/how-strong-is-new-yorks-illegal-gambling-case-against-valves-loot-boxes/

On Thursday, WBD’s board deemed Paramount’s revamped offer “superior,” giving Netflix four business days to match it. But that same day, Netflix, which had recently emphasized its willingness to walk away from mergers it deems overly expensive, said it would no longer pursue the acquisition.

A statement from Netflix co-CEOs Ted Sarandos and Greg Peters issued last night said:

The transaction we negotiated would have created shareholder value with a clear path to regulatory approval. However, we’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive, so we are declining to match the Paramount Skydance bid.

The CEOs added that the WBD merger “was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”

Netflix and Paramount’s stock have continuously declined since Netflix announced its planned merger. Following yesterday’s announcement, Netflix shares rose by more than 10 percent in after-hours trading, and Paramount shares increased by 5 percent.

In a statement quoted by The Hollywood Reporter yesterday, WBD President and CEO David Zaslav said, “Once our board votes to adopt the Paramount merger agreement, it will create tremendous value for our shareholders. We are excited about the potential of a combined Paramount Skydance and Warner Bros. Discovery and can’t wait to get started working together telling the stories that move the world.”

The article was edited to correct ticking fee information. 

https://arstechnica.com/gadgets/2026/02/netflix-cedes-warner-bros-discovery-to-paramount-no-longer-financially-attractive/

“To our understanding, sound barriers can reduce certain frequencies under controlled conditions, but turbine noise involves low-frequency sounds and tonal components that often reach beyond barriers,” the coalition’s spokesperson said. “The most effective method for reducing industrial noise exposure is typically distance from residential areas, which is not a mitigation option in this scenario given the facility’s proximity to homes.”

The coalition urged xAI to be transparent and to share data backing mitigation claims if it wants the community to believe that the second sound barrier will make any difference.

“Without transparent modeling, validated field measurements, and independent verification, it is difficult to assess whether the barrier will meaningfully address the ongoing nuisance experienced by nearby residents,” the coalition’s spokesperson said. “Mitigation claims are only meaningful if they are supported by transparent data.”

Mayor labels protestors Musk haters

At least one city official, Mayor Darren Musselwhite, has suggested that community backlash is “political.” Although he acknowledged that the noise was a “legitimate concern,” he also claimed on Facebook that some people protesting xAI’s facility were simply Elon Musk haters, NBC News reported.

“Southaven is now under attack by all who choose to oppose Elon Musk because of his high-profile political stances,” Musselwhite wrote.

However, residents told NBC News that “their concerns have nothing to do with politics.” One person interviewed even praised Musk’s work with the Department of Government Efficiency.

Instead, they’re worried that local officials seeing dollar signs have potentially let xAI exploit loopholes to pollute communities without any warning. The community flyer from the Safe and Sound Coalition criticized what they viewed as shady behavior from local officials:

“This project was started behind our backs, with zero community input. Local officials have repeatedly downplayed concerns, spun the facts, and misled residents about the true impacts and the deals made with xAI. Many people only found out after the turbines were up and running.”

The coalition’s spokesperson told Ars that a health impact analysis published on behalf of the SELC provides “meaningful insight” into the biggest health risks. That concluded that using the EPA’s COBRA health impact model, emissions from running 41 permanent turbines at the Southaven plant “are estimated to result in $30–$44 million per year in health-related damages, including costs from premature deaths, hospital visits, and lost productivity. Over a typical 30-year operating life, these impacts would amount to approximately $588–$862 million in cumulative discounted public-health costs, borne largely by residents of Tennessee and Mississippi.”

https://arstechnica.com/tech-policy/2026/02/pops-whines-and-roars-xai-accused-of-torturing-neighbors-of-noisy-power-plant/

Opening a valuable skin like this in a loot box is akin to winning a lottery, New York alleges in a new lawsuit.

The lawsuit also takes Valve to task for allowing third-party sites that facilitate the resale of in-game skins for cash. While the suit notes that Valve has “sporadically enforced” rules against so-called skin gambling sites—which use Steam inventories as virtual chips for gambling games—it alleges that Valve “has not acted against sites that permit the sale of Valve’s virtual items.” The suit cites “internal communications” from numerous Valve employees suggesting that the company was OK with such “cash-out services” for Steam items as long as off-platform gambling wasn’t explicitly involved.

We’ll see you in court

In a press release announcing the suit, state Attorney General Letitia James said the gambling Valve’s system enables can “lead to serious addiction problems, especially for our young people. … These features are addictive, harmful, and illegal, and my office is suing to stop Valve’s illegal conduct and protect New Yorkers.”

In 2016, Valve faced a pair of civil lawsuits from parents concerned about Valve’s connection to skin gambling sites—those suits were eventually dismissed. Around the same time, Valve received a letter from Washington state threatening “civil or criminal action” if Valve didn’t crack down on skin gambling, but the state stopped short of filing a lawsuit in that matter.

In addition to asking Valve to modify or eliminate its loot box system, the New York suit asks for Valve to make “full restitution to consumers” for the disgorgement of “all monies” received from its gambling system, and for fines of “three times the amount of its gain.” Ars Technica has reached out to Valve for comment.

https://arstechnica.com/gaming/2026/02/new-york-sues-valve-for-enabling-illegal-gambling-with-loot-boxes/

But this claim hinges entirely upon xAI proving that OpenAI poached its employees to steal its trade secrets. So, for xAI’s lawsuit to proceed, xAI will need to beef up the evidence base for its other claim, that OpenAI has violated the federal Defend Trade Secrets Act, Lin said. To succeed on that, xAI must prove that OpenAI unlawfully acquired, disclosed, or used a trade secret with xAI’s consent.

That will likely be challenging because xAI, at this point, has not offered “any nonconclusory allegations that OpenAI itself acquired, disclosed, or used xAI’s trade secrets,” Lin wrote.

All xAI has claimed is that OpenAI induced former employees to share secrets, and so far, nothing backs that claim, Lin said. Tishler noted that the court also rejected an xAI theory that “OpenAI should be responsible for what its new hires did before they arrived” for “the same reason: without evidence that OpenAI directed the theft or actually put the stolen information to use, you cannot hold the company liable.”

The strongest evidence that xAI had of employee misconduct, allegedly allowing OpenAI to misappropriate xAI trade secrets, revolves around the departure of one of xAI’s earliest engineers, Xuechen Li.

That evidence wasn’t enough, Lin said. xAI alleged that Li gave a presentation to OpenAI that supposedly included confidential information. Li also uploaded “the entire xAI source code base to a personal cloud account,” which he had connected to ChatGPT, Lin noted, after a recruiter sent a message on Signal sharing a link with Li to another unrelated cloud storage location.

xAI hoped the Signal messages would shock the court, expecting it to read through the lines the way xAI did. As proof that OpenAI allegedly got access to xAI’s source code, xAI pointed to a Signal message that an OpenAI recruiter sent to Li “four hours after” Li downloaded the source code, saying “nw!” xAI has alleged this message is short-hand for “no way!”—suggesting the OpenAI recruiter was geeked to get access to xAI’s source code. But in a footnote, Lin said that “OpenAI insists that ‘nw’ means ‘no worries,’” and thus is unconnected to Li’s decision to upload the source code to a ChatGPT-linked cloud account.

https://arstechnica.com/tech-policy/2026/02/judge-xai-cant-claim-openai-stole-trade-secrets-just-by-hiring-ex-staffers/

Judge should have gone further, press group says

Even without being aware of the PPA, the court did not approve the Natanson warrant right away. Porter’s order said the court rejected the government’s first two requests for a search warrant because they were too broad. The court was “concerned about both the scope of the proposed search warrant and the government’s apparent attempt to collect information about Ms. Natanson’s confidential sources,” he wrote.

The search warrant ultimately approved by the court was limited to information that Natanson received from Aurelio Luis Perez-Lugones and information related to Perez-Lugones that could be evidence in the case against him.

“The government expressly alleged that Ms. Natanson received classified information from Mr. Perez-Lugones,” but its search warrant application did not say whether Natanson herself was a target of the criminal investigation, Porter wrote. “The Court learned that Ms. Natanson was not a focus of the investigation only through press reports published the day the warrant was executed,” he wrote.

Porter said the court has to take seriously the government’s claim that the case “involves top secret national security information,” even though the court doesn’t know whether disclosure of the information would cause harm. “The Court takes the government at its word, while acknowledging the well-documented concern that the government has at times overclassified information to avoid embarrassing disclosures rather than to protect genuine secrets,” he wrote.

The Freedom of the Press Foundation said that “Judge Porter was right to treat the seizure as a prior restraint and to limit the government from fishing through the irrelevant data it seized to snoop on reporters,” and right to reprimand prosecutors for the omission in their search warrant application. But the order didn’t go far enough, the foundation said.

“Judge Porter should have required all of Natanson’s materials seized pursuant to the deceptive warrant application to be returned to her,” the group said. “And he should not have credited the administration’s claims that any of the seized materials posed a national security threat without strict proof—as Judge Porter acknowledged, this administration, even more so than others, has a long track record of falsely claiming national security threats to protect itself from embarrassment and further its political agenda. It has earned zero deference from the judiciary on claims of national security threats, particularly when press freedom is at stake.”

https://arstechnica.com/tech-policy/2026/02/judge-doesnt-trust-doj-with-search-of-devices-seized-from-wash-post-reporter/

DJI, the most popular consumer drone maker, is suing over the Federal Communications Commission (FCC)’s import ban against new, foreign-made drones, which has been in effect since December 23, 2025.

On Tuesday, the Shenzhen-headquartered company filed a petition [PDF] with the US Court of Appeals for the Ninth Circuit that seeks to overturn the FCC’s decision to list DJI on its Covered List. The Covered List includes communications equipment and services that are “deemed to pose an unacceptable risk to the national security of the United States or the security and safety of United States persons,” per the FCC.

In its petition dated February 20, 2026, DJI said:

Petitioners seek review of the Ruling on the ground that the FCC exceeded its statutory authority, failed to observe statutorily required procedures, and violated the Fifth Amendment when it purported to add DJI’s products to the Covered List. Petitioners respectfully request his Court hold unlawful, vacate, enjoin, and set aside the Ruling and grant any other relief that the Court finds proper.

In January, the FCC exempted a limited number of foreign-made drones, including some coming from Europe, until the end of this year. The FCC also provided exemptions for some foreign-made critical drone components, including those from Japanese companies Sony and Panasonic, and South Korean company Samsung. The FCC hasn’t exempted any drones or drone parts made in China.

In a December 22 statement, the FCC said that “criminals, hostile foreign actors, and terrorists can use [drones] to present new and serious threats to our homeland.” The FCC said at the time that it made its decision about the ban after a review by an Executive Branch interagency body review that it said had “appropriate national security expertise” and “was convened by the White House.”

DJI reportedly requested that the US government audit its devices multiple times before the US issued the import ban.

In a company statement shared with Bloomberg today, DJI said:

Despite repeated efforts to engage with the government, DJI has never been given the chance to provide information to address or refute any concerns. These procedural and substantive deficiencies violate the Constitution and federal law.

In a statement to Reuters today, DJI also said that the FCC’s decision “carelessly restricts DJI’s business in the US and summarily denies U.S. customers access to its latest technology.”

https://arstechnica.com/gadgets/2026/02/dji-sues-the-fcc-for-carelessly-restricting-its-drones/