US regulators launch probe into tech giant's AI investments, ET Telecom

Written by Alex Pigman

WASHINGTON: The top US antitrust regulator announced Thursday that it will launch an investigation into investments by Microsoft, Google and Amazon in generative AI startups OpenAI and Anthropic.

The move is part of efforts by key authorities to ensure regulatory oversight catches up with developments in artificial intelligence and to prevent major companies from crowding out competitors in a field that is expected to disrupt multiple sectors.

“Our investigation will shed light on whether the investments and partnerships pursued by leading companies risk distorting innovation and undermining fair competition,” Federal Trade Commission Chair Lina Khan said in a statement. I will do it,” he said.

One big concern is that generative AI, which allows software to generate human-level content in seconds, requires massive amounts of computing power, something that big tech companies are almost uniquely able to provide.

Amazon — through its AWS division — Microsoft and Google are the world's largest providers of cloud-based data centers.

Microsoft invested $13 billion in OpenAI, the creator of ChatGPT, and was one of the earliest drivers of the generative AI revolution.

And after a board battle that saw OpenAI CEO Sam Altman temporarily removed from his seat, Microsoft now holds a non-voting seat on the company's board. .

Founded by former OpenAI staff, Anthropic received major investments from both Google and Amazon last year and is seen as a potential major player in the rapidly emerging field of generative AI.

Amazon has already announced that it aims to power its Alexa voice assistant with generative AI, which the company said will allow users to have smoother conversations with connected devices.

Anthropic also agreed to use Amazon's chips in the development of its next models, and the two companies said they would collaborate on the development of next-generation AI chips.

The company also agreed to use Amazon Web Services' (AWS) cloud infrastructure, data centers that store and process large amounts of data.

The FTC plans to investigate this cooperation in detail.

The FTC's investigation is aimed at “gaining a deeper understanding of market trends and business practices,” and the findings could guide the commission in taking legal action, the regulator said.

Earlier this month, the European Commission launched its own preliminary investigation into Microsoft's multibillion-dollar investment in OpenAI into whether it could be a sham merger.

Anthropic declined to comment when asked by AFP. OpenAI, Amazon, and Google also did not immediately respond to requests for comment.