The Federal Trade Commission (FTC) of the United States of America is actively examining AI collaborations and investments made by major tech corporations, placing a specific emphasis on scrutinizing their competitive effects and strategic significance.
Major AI players like Amazon, Alphabet, Microsoft, Anthropic, and OpenAI will be subject to examination by the FTC regarding how they structure their investments and partnerships, and the resulting impact on competition.
The FTC’s orders on January 25 require the five companies to provide information about any agreements with generative AI companies or major cloud service providers, along with the rationale behind those agreements.
Specific orders were issued to five companies involved in significant AI investments, including Microsoft’s $10 billion investment in OpenAI, Amazon’s $1 billion investment in OpenAI, Anthropic’s $1 billion investment from Microsoft, Google’s $600 million investment in Inflection AI, and OpenAI’s $100 million investment in Anthropic.
During a tech summit organized by the agency, FTC Chair Lina Khan stated that the issued orders constitute a “market inquiry into the investments and partnerships being formed between AI developers and major cloud service providers.”
Companies are employing various approaches to develop and utilize AI, including partnerships and direct investments in AI developers to access the necessary technologies and inputs for AI development.
The FTC has the power to issue civil investigative demands and conduct investigations independently from its law enforcement function.
This authority allows the agency to require companies to furnish specific reports and respond to inquiries regarding their business activities.
The FTC is actively seeking information on how these partnerships influence competition for AI inputs and resources, including examining the competitive dynamics surrounding essential products and services crucial for generative AI.
Additionally, the commission is keen on obtaining details about information shared with any government entity, whether domestic or foreign, concerning investigations, requests for information, or other inquiries related to these subjects.
The U.K. antitrust agency is also considering an investigation into Microsoft’s collaboration with OpenAI, and Microsoft has indicated that it has a non-voting observer role on the ChatGPT developer’s board.
The European Commission has signaled its intention to examine whether Microsoft’s investment in OpenAI could be subject to review under the EU Merger Regulation.
Mr Altman has called OpenAI’s relationship with Microsoft “the best bromance in tech.” Since 2019, the companies have worked together to build advanced artificial intelligence systems that they believe could be the most important tech innovations in a generation, and Microsoft has invested $13 billion in OpenAI. Together, they planned to take on Google’s hammerlock on the internet.
OpenAI has most likely seen only a part of the $13 billion that Microsoft has committed because it was supposed to be paid out over time — though the exact terms of the deal were unclear. In addition, Microsoft signed a deal that gave it copies of OpenAI’s most cutting-edge technology and has been working with it for more than a year. Microsoft has been providing OpenAI with the enormous computer power it needs to build its A.I.
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