Why It Matters
The U.S. Army has determined that none of the 10,000 Integrated Visual Augmentation System (IVAS) headsets it developed and procured between 2018 and 2025 will be fielded to soldiers, according to a Congressional Research Service (CRS) report updated in July 2026. This $1.8 billion investment in a ruggedized extended reality heads-up display originally based on Microsoft's HoloLens represents a significant defense acquisition failure. A 2022 Department of Defense (DOD) Inspector General audit had warned that inadequate user acceptance testing could result in wasting up to $21.88 billion in taxpayer funds if soldiers rejected the system.
The Big Picture
The Army awarded Microsoft an Other Transaction Agreement worth up to $22 billion over 10 years in November 2018 to develop IVAS. Between 2018 and 2025, the service procured two major increments: 5,000 IVAS 1.0 units in 2022 and 5,000 IVAS 1.1 units in 2023. From the start, soldiers reported serious problems. Early versions caused mission-affecting headaches, eyestrain, and nausea.
The Army's response was to redesign the IVAS 1.2 prototype, reducing its field of view from 70 degrees to 60 degrees. However, problems that users reported with the 1.0 and 1.1 versions were not adequately addressed in the 1.2 redesign. The Army requested $255 million to procure 3,162 of these units in fiscal 2025, along with $58.6 million in research and development funding.
An Army spokesperson told Task & Purpose in June 2026 that the headsets were unaffordable to produce at scale, a candid admission that the technology had become economically unviable despite years of refinement.
In March 2025, the Army renamed the IVAS Next program to Soldier Borne Mission Command (SBMC) and announced a full and open competition. The Army awarded Anduril a $159 million contract and startup firm Rivet a $195 million contract to prototype new helmet-mounted mixed reality systems under SBMC, with an 18-month rapid prototyping sprint. The April 2025 contract novation transferred Microsoft's original IVAS agreement to Anduril, which had partnered with Microsoft to integrate its Lattice artificial intelligence and sensor fusion platform into the system.
Analysts have raised concerns about security vulnerabilities in extended reality systems. Inception attacks could allow adversaries to steal data, manipulate the operational picture, cause misidentification of targets risking fratricide or civilian casualties, or gain command and control of U.S. uncrewed systems such as microdrones.
The Bottom Line
The Army's decision to abandon 10,000 completed units suggests the service learned a hard lesson about establishing rigorous testing requirements before scaling procurement. The shift to SBMC and rapid prototyping with multiple contractors signals a move toward more iterative development, though the fundamental challenge of integrating advanced technology with soldier needs remains unresolved.
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