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DOJ to scrutinize Big Tech’s AI dominance ‘with urgency,’ antitrust chief says

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Federal regulators reached a deal to launch antitrust investigations into the dominant roles that Microsoft, OpenAI and Nvidia play in the artificial intelligence industry, according to multiple reports.

The Justice Department will investigate chipmaking giant Nvidia and whether it has violated antitrust laws. Meanwhile, the Federal Trade Commission will set its sights on ChatGPT maker OpenAI and Microsoft, which invested $13 billion into the AI firm.

The agreement between the two agencies is set to be finalized in the coming days, the New York Times reported, citing sources familiar with the matter.

DOJ antitrust chief Jonathan Kanter told the Financial Times that his team was actively examining “monopoly choke points and the competitive landscape” in AI.

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.”

DOJ antitrust chief Jonathan Kanter AP

The DOJ and FTC declined comment.

Spokespersons for Nvidia and OpenAI declined to comment on the regulators’ agreement on Thursday. Microsoft said it takes its legal obligations to report transactions seriously and is confident it has complied with them.

Antitrust enforcers have publicly expressed a range of concerns around AI, from the advantage that Big Tech companies have in their access to data used to train AI models, to how generative AI affects the market for creative work, to partnerships between companies potentially being used to sidestep required merger review processes.

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The move to divvy up the industry mirrors a similar agreement between the two agencies in 2019 to divide enforcement against Big Tech, which ultimately saw the FTC bring cases against Meta and Amazon, and the DOJ sue Apple and Google for alleged violations.

Those cases are ongoing and the companies have denied wrongdoing.

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.

The agreement between the two regulators comes after the FTC in January ordered OpenAI, Microsoft, Alphabet, Amazon and Anthropic to provide information on recent investments and partnerships involving generative AI companies and cloud service providers.

Kanter, meanwhile, 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.

Jonathan Kanter said the DOJ will examine AI firms “with urgency.” AFP via Getty Images

“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.”

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News publishers have called on the feds to investigate Google over its AI Overviews feature. AP

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.

OpenAI is among the AI firms that could face scrutiny from regulators. AFP via Getty Images

“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.

With Post wires



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