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US regulators to open antitrust investigations into Nvidia, Microsoft and OpenAI

US regulators to open antitrust investigations into Nvidia, Microsoft and OpenAI
US regulators to open antitrust investigations into Nvidia, Microsoft and OpenAI

 


Sam Altman (left), CEO of OpenAI, speaks with Kevin Scott, Microsoft's chief technology officer and executive vice president of artificial intelligence, during the Microsoft Build conference at Microsoft headquarters in Redmond, Washington , May 21, 2024.

Jason Redmond | AFP | Getty Images

The Federal Trade Commission and the Department of Justice are preparing to open antitrust investigations into Microsoft, OpenAI and Nvidia, examining the influence of these powerful companies on the artificial intelligence sector, a source confirmed to CNBC.

The FTC will take the lead in investigating Microsoft and OpenAI, while the DOJ will focus on Nvidia, and the investigations will focus on corporate behavior, rather than mergers and acquisitions, according to the source.

The New York Times was first to report on the investigation.

As startups like OpenAI and Anthropic, the companies behind chatbots ChatGPT and Claude, respectively, gain traction in the generative AI market, tech giants like Google, Microsoft, Amazon, and Meta have taken part. to a sort of AI arms race, rushing to integrate the technology. to ensure they don't fall behind in a market expected to reach $1 trillion in revenue within a decade.

Microsoft, for example, first invested $1 billion in OpenAI in 2019. The size of its investment has since grown to around $13 billion. Microsoft uses the OpenAI model extensively for its Copilot chatbot and offers open source models on its Azure cloud.

These considerable investments are necessary because AI models are notoriously expensive to build and train, requiring thousands of specialized chips that, to date, have largely come from Nvidia. Meta, which is developing its own model called Llama, said it is spending billions on graphics processing units from Nvidia, one of several companies that have helped the chipmaker increase its revenue year-over-year. 'other by more than 250%.

News of the upcoming antitrust investigation comes days after a group of current and former OpenAI employees published an open letter on Tuesday, outlining their concerns about the rapid progress of the AI ​​industry despite a lack of oversight and an absence of whistleblower protections for those who wish to speak out.

“AI companies have a strong financial incentive to avoid effective oversight, and we do not believe that tailored corporate governance structures are sufficient to change this,” the employees wrote, adding that the companies “have not Currently there are only weak obligations to share some of this information with governments, and none with civil society. We do not think they can be counted on to share it voluntarily.

This news also follows the FTC's decision in January to conduct an in-depth study of AI industry heavyweights, including Amazon, Alphabet, Microsoft, Anthropic and OpenAI.

FTC Chair Lina Khan announced the investigation in January at the agency's AI technology summit, describing it as a “market investigation into investments and partnerships formed among AI developers and major cloud service providers.”

By invoking its authority to conduct a so-called 6(b) study, named after Section 6(b) of the FTC Act, the regulator can examine AI companies separately from its law enforcement agency and formulate requests for civil investigations. For example, the agency can order companies to file specific reports and respond in writing to questions about their activities.

“At the FTC, the rapid development and deployment of AI is informing our work at the agency,” Khan said at the time. “There are no AI exemptions from existing laws, and we are looking closely at how companies can use their power to thwart competition or mislead the public.”

OpenAI did not respond to a request for comment. Microsoft and Nvidia declined to comment.

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Sources

1/ https://Google.com/

2/ https://www.cnbc.com/2024/06/06/us-regulators-to-open-antitrust-probes-into-nvidia-microsoft-and-openai.html

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