Justice Department antitrust chief Jonathan Kanter said the agency is exploring a potential crackdown on leading artificial intelligence firms to ensure fair competition in the tech sector.
The DOJ is actively examining “monopoly choke points and the competitive landscape” in AI, Kanter told the Financial Times.
Officials have raised concerned that tech giants such as Microsoft, OpenAI, Google, Amazon and chipmaker Nvidia have relied on their deep pockets to wield massive influence over the burgeoning sector.
Kanter said the DOJ antitrust cops need to act “with urgency” to ensure that the firms can’t dominate the AI market.
“Sometimes the most meaningful intervention is when the intervention is in real time,” Kanter told the outlet. “The beauty of that is you can be less invasive.”
The DOJ already has active antitrust lawsuits pending against Google and Apple, though the claims do not deal directly with the rise of AI. Separately, the Federal Trade Commission has filed cases against Meta and Amazon.
The FTC is also probing Microsoft’s $13 billion investment in OpenAI, as well as Google and Amazon’s investments in rising AI firm Anthropic.
Potential areas of new scrutiny reportedly include the use of data to train their large-language models – such as the one that powers ChatGPT – as well as implications in cloud-computing, scarce computer chips and even hiring.
Kanter pointed out that the advanced computer chips required for generative AI, such as those manufactured by Nvidia, have become a “scarce resource” and his team would examine how chipmaking companies are determining which firms receive the crucial products.
“One of the things to think through is conflict of interest, a thumb on the scale, because they fear enabling a competitor or are helping to prop up a customer,” Kanter said.
Nvidia shares have soared more than 150% this year, and the chipmaker surpassed Apple as the second-most valuable company in the world Wednesday — trailing only Microsoft.
Kanter added that potential regulatory issues arise “if decisions are being made that show companies are not caring about maximizing profitability or generating shareholder value, but more looking at the competitive consequences.”
The DOJ is also expected to probe so-called “acqui-hires,” in which firms conduct mass hiring from a particular startup rather than buy it outright and risk antitrust scrutiny.
Separately, the Wall Street Journal reported that the FTC was investigating Microsoft’s move to conduct a mass hiring of staffers from the AI startup Inflection.
The agency is said to be exploring how and why Microsoft negotiated the deal, which included an approximately $650 million licensing fee paid to Inflection for the right to resell its technology.
Microsoft President Brad Smith defended the deal in a statement to the FT.
“We didn’t want to own the company,” Smith said. “We wanted to hire some of the people who worked at the company.
Elsewhere, Google has faced scrutiny over its integration of AI features into its core search engine.
Critics, including the News Media Alliance, a nonprofit that represents hundreds of news publishers including The Post, have warned it will decimate traffic for competitors and called on the DOJ and the FTC to scrutinize the AI launch.
Source: NYPOST