FTC opens inquiry into ties between Big Tech, AI firms
U.S. antitrust enforcers are opening an inquiry into the relationships between leading artificial intelligence startups such as Chat GPT-maker OpenAI and the tech giants that have invested billions of dollars into them.
The action targets Amazon, Google and Microsoft and their sway over the generative AI boom that’s fueled demand for chatbots like ChatGPT and other AI tools that can produce novel text, imagery and sound.
“We’re scrutinizing whether these ties enable dominant firms to exert undue influence or gain privileged access in ways that could undermine fair competition,” said Lina Khan, chairwoman of the Federal Trade Commission, in opening remarks Thursday at an AI forum in Washington.
Khan said the market inquiry would review “the investments and partnerships being formed between AI developers and major cloud service providers.”
The FTC said Thursday it issued “compulsory orders” to five companies — cloud providers Amazon, Google and Microsoft, and AI startups Anthropic and OpenAI — requiring them to provide information about their agreements and the decision-making around them.
Microsoft’s years-long relationship with OpenAI is the best known. Google and Amazon have more recently made multibillion-dollar deals with Anthropic, another San Francisco-based AI startup formed by former leaders at OpenAI.
Amazon, Anthropic and OpenAI declined to comment.
The European Union and the United Kingdom have already signaled they’re scrutinizing Microsoft’s OpenAI investments. The EU’s executive branch said this month the partnership might trigger an investigation under regulations covering mergers and acquisitions that would harm competition in the 27-nation bloc. Britain’s antitrust watchdog opened a similar review in December.
Antitrust advocates welcomed the actions from both the FTC and Europe on deals some have derided as quasi-mergers.
“Big Tech firms know they can’t buy the top A.I. companies, so instead they are finding ways of exerting influence without formally calling it an acquisition,” said a written statement from Matt Stoller, director of research at the American Economic Liberties Project.
Microsoft has never publicly disclosed the dollar amount of its investment in OpenAI, which Microsoft CEO Satya Nadella has described as a “complicated thing.”
Microsoft made its first $1 billion investment in San Francisco-based OpenAI in 2019, more than two years before the startup introduced ChatGPT and sparked worldwide fascination with AI advancements.