Published in AI

US watchdog probes Microsoft, Google and Amazon's AI investments 

by on26 January 2024

Concerns about investing in rivals

A US watchdog is snuffling around the billions of dollars that Microsoft, Google and Amazon have splashed on rival AI startups OpenAI and Anthropic.

The Federal Trade Commission (FTC) wants to ensure that tech giants stay within the competition in the booming field of artificial intelligence, which could transform everything from health to entertainment.

The FTC's boss, Lina Khan, said one of the worries is that AI needs a lot of computer power, which only the tech titans can afford.

Amazon, Microsoft, and Google are the world's top cloud computing providers, allowing them to store and process vast amounts of data and make them filthy rich.

Microsoft has been the quickest to adopt AI, signing a whopping $13 billion deal with OpenAI, the maker of ChatGPT.

But after a boardroom bust-up that saw OpenAI's boss Sam Altman kicked out, Microsoft now has a seat at the table.

Anthropic, set up by ex-OpenAI staff, raised big bucks from Google and Amazon last year and is tipped to be a major player in AI.

Amazon said it wanted to boost its Alexa voice assistant with AI, which it claimed would make it more chatty.

Anthropic agreed to use Amazon's chips for its following projects, and the two firms said they would collaborate on making new AI chips.

The startup also agreed to use Amazon's cloud services.

The FTC is going to take a closer look at these cosy deals.

Regulators in Britain, the EU and now the FTC are all on the case, closing in on the so-called AI 'partnerships' - which are takeovers in disguise, according to Max von Thun, a campaigner for Open Markets, an anti-monopoly group.

The FTC said its studies would help it understand the market and crack down on wrongdoing.

Microsoft's vice president, Rima Alaily, said they would cooperate with the FTC.

She said: "Partnerships between independent companies like Microsoft and OpenAI, and many others, are good for competition and innovation."

Google hoped the FTC would expose the firms that don't have the openness of Google Cloud or lock in their customers - and are doing the same with AI.

This was a dig at Microsoft and its tight relationship with OpenAI, which gives Microsoft first dibs on OpenAI's cutting-edge technology and profits until it gets its money back.

Khan, a former academic, has been going after big tech since she took over in 2021 but has not succeeded.

This summer, for example, the FTC had to drop its attempt to stop Microsoft's takeover of Activision Blizzard, the video game giant, after a judge threw out its case.

The FTC sued Amazon in September, allegedly making it harder for small businesses to compete on its platform.

The EU's executive arm, the European Commission, started its probe earlier this month to determine whether Microsoft's mega-deal with OpenAI was a sneaky merger.

Britain's competition watchdog did the same in December.


Last modified on 26 January 2024
Rate this item
(1 Vote)