To maintain fair competition, US regulators are looking into AI companies for possible antitrust infractions
In the artificial intelligence sector, Microsoft, OpenAI, and Nvidia are under increased antitrust scrutiny in the wake of news that US regulators have decided to look into the businesses. According to the New York Times, the US Department of Justice (DoJ) and the Federal Trade Commission (FTC) have agreed to look into the top companies in the artificial intelligence (AI) market. It is anticipated that the deal will be completed in the next few days.
According to a New York Times story published on Wednesday, the Department of Justice (DoJ) will lead the inquiry into whether Nvidia, a well-known producer of processors needed for AI system operation and training, has broken antitrust rules designed to maintain fair competition and prevent monopolies.
At the same time, the Federal Trade Commission (FTC) will investigate both Microsoft, which is a major financial backer of other AI startups and is the largest investor in OpenAI, the company that created the ChatGPT chatbot.
The FTC is reportedly investigating whether Microsoft arranged a recent arrangement with company Inflection AI to evade an antitrust investigation, according to a Wall Street Journal article on Thursday. Microsoft agreed to pay Inflection $650 million (£508 million) in order to licence its AI software, and in March it appointed British businessman Mustafa Suleyman, the CEO and co-founder of Inflection, to head a new AI branch.
The FTC has shown that it is interested in the market for AI. It ordered OpenAI, Microsoft, Amazon, Alphabet, the parent company of Google, and startup Anthropic to disclose information in January on their recent agreements and investments with cloud service providers and generative AI companies.
Furthermore, the FTC opened an investigation into OpenAI last year after receiving claims that it had breached consumer protection regulations by putting data and personal reputations at risk.
The DoJ’s antitrust division chief, Jonathan Kanter, told the Financial Times on Thursday that the agency would investigate artificial intelligence (AI) quickly, emphasising “monopoly choke points and the competitive landscape” in technology. Kanter also reminded readers that regulators must move quickly to keep dominant tech companies from controlling the market. On Wednesday, Nvidia became the first company to be valued at $3 trillion, surpassing Apple in the process.
Professor Rebecca Haw Allensworth of Vanderbilt Law School observed that the DoJ and FTC’s purported cooperation suggests that a more cooperative relationship has emerged during the Biden administration.
She clarified, saying, “The authorities are sharing responsibilities and collaborating closely because of the market’s size and significance for antitrust enforcement. Previously, they divided investigations based on industry. Without a doubt, the agencies see artificial intelligence (AI) as the next stage of anticompetitive behaviour by companies who are currently perceived as suppressing and avoiding competition.”
Regarding the Inflection deal, Microsoft declared that it was “confident” that it had complied with antitrust requirements. Nvidia, OpenAI, the DoJ, and the FTC all declined to comment.