Ads
The US Federal Trade Commission is now looking into the various investments and partnerships that are being made by some of the world’s biggest tech companies for AI development. Today, the FTC revealed it has launched an official inquiry on these AI partnerships and investments.
In a press release, the FTC is ordering tech companies like Microsoft, OpenAI, Google’s parent company Alphabet, Amazon, and AI startup Anthropic to send them information concerning “recent investments and partnerships involving generative AI companies and major cloud service providers.” The purpose of this inquiry is for the FTC to get a better understanding of these partnerships and how they could affect competition in the overall tech industry with AI ventures
FTC Chair Lina M. Khan stated:
Our study will shed light on whether investments and partnerships pursued by dominant companies risk distorting innovation and undermining fair competition.
The inquiry will be looking into a number of different aspects of these AI tech partnerships, including “competition for AI inputs and resources,” along with “practical implications of a specific partnership or investment” and an “analysis of the transactions’ competitive impact.”
The five companies named in the FTC order now have 45 days to supply the agency with the relevant information. It’s possible that the FTC could use it to launch a more detailed probe into these AI associations.
Microsoft’s investments and its current partnership with OpenAI will likely get the most attention from the FTC’s study. Microsoft started investing in OpenAI back in 2019. In 2023, Microsoft began to use OpenAI’s ChatGPT and DALL-E AI models for its services, like its various Copilot (formerly Bing Chat) efforts.
In addition to the FTC, the US Department of Justice is also reportedly thinking about looking into the Microsoft-OpenAI partnership to see if it violates any antitrust laws. In December 2023, the UK Competition and Markets Authority asked Microsoft and OpenAI, along with other interested third parties, to send comments to the regulatory body. The CMA wants to determine if this tight partnership “has resulted in a relevant merger situation.”
Update – Microsoft has sent Neowin a statement on the FTC inquiry from Rima Alaily, its Corporate Vice President, Competition and Market Regulation Group:
The U.S. has assumed a global AI leadership position because important American companies are working together. Partnerships between independent companies like Microsoft and OpenAI, as well as among many others, are promoting competition and accelerating innovation. We look forward to providing the FTC with the information it needs to complete its study.
