Pentagon reviewing Microsoft 365 licenses as part of DOGE-related cuts; Democrats push Palantir for answers on reports of IRS ‘mega-database’

The Department of Defense’s Office of the Chief Information Officer is considering reducing the number of Pentagon employees who have Microsoft 365 E5 licenses, as it works with the Trump administration to rein in federal spending. The DOD currently maintains more than 2 million Microsoft 365 E5 licenses across two separate programs — the Defense Enterprise Office Solution (DEOS) and the Enterprise Software Initiative (DOD ESI). Through the established contracts, Pentagon components can purchase software licenses for commercial Microsoft products, including Office 365 applications and other collaboration tools. But ongoing efforts spearheaded by the Department of Government Efficiency (DOGE) have prompted the Defense Department to review how many of those licenses it actually needs, Katie Arrington, who is performing the duties of Pentagon CIO, told DefenseScoop. Arrington said June 6 in an exclusive interview: “Our Microsoft 365 contract [is a] very big contract here in the Department of Defense. Does every individual in the Department of Defense need an [E5] license? Absolutely not.” With the department’s Deputy CIO for the Information Enterprise Bill Dunlap, Arrington has been working alongside her DOGE representative to review individual position descriptions and multi-level securities to determine what level of Microsoft 365 E5 license that person needs, she said. Other criteria being considered include user and mission requirements for office productivity software, as well as collaboration capabilities, a DOD CIO spokesperson told DefenseScoop. Ten congressional Democrats are demanding answers from Palantir about reports that it is aiding the IRS in building a searchable, governmentwide “mega-database” to house Americans’ sensitive information. In a letter sent Tuesday to Palantir CEO Alex Karp, the lawmakers argued that the creation of a database of that kind likely violates several federal laws, including the Privacy Act. The Democrats wrote: “The unprecedented possibility of a searchable, ‘mega-database’ of tax returns and other data that will potentially be shared with or accessed by other federal agencies is a surveillance nightmare that raises a host of legal concerns, not least that it will make it significantly easier for Donald Trump’s Administration to spy on and target his growing list of enemies and other Americans.” The letter, led by Senate Finance Committee ranking member Ron Wyden, D-Ore., and Rep. Alexandria Ocasio-Cortez, D-N.Y., follows New York Times reporting last month that detailed the expansion of Palantir’s federal government work under the Trump administration, noting that the data-mining giant has received $113 million since the president’s January inauguration plus another $795 million award from the Defense Department. According to the Times, Palantir has spoken to IRS and Social Security Administration representatives about buying its tech. The Democrats’ letter said Foundry — a Palantir data analysis and organization product — has been deployed at the departments of Homeland Security and Health and Human Services, as well as the Food and Drug Administration, the Centers for Disease Control and Prevention, and the National Institutes of Health. The Daily Scoop Podcast is available every Monday-Friday afternoon. If you want to hear more of the latest from Washington, subscribe to The Daily Scoop Podcast  on Apple Podcasts, Soundcloud, Spotify and YouTube.