OpenAI and Microsoft Referred to by FTC and DOJ on Antitrust Concerns
The US Federal Trade Commission (FTC) and Department of Justice (DOJ) are expected to open antitrust investigations against Microsoft and OpenAI and launch a review to combat Nvidia’s dominance in the artificial intelligence (AI) market.
According to the latest report, the review will be about the behavior of these companies in the field of artificial intelligence.
Microsoft, OpenAI, Nvidia Face DOJ and FTC Investigation
These studies mainly focus on the activities of these technology companies, especially their behavior and actions, rather than mergers and acquisitions. The FTC will lead the investigation into Microsoft and OpenAI, while the DOJ will focus on Nvidia.
These actions point to regulators’ growing concerns about the potential for abuse of market power that could stifle competition in the emerging AI market.
Among the companies, Microsoft also attracts great attention in this regard due to its huge investment of approximately $ 13 billion in OpenAI since 2019, as well as its collaboration on many artificial intelligence projects, including Microsoft Copilot. The FTC is also investigating Microsoft’s recent $650 million acquisition of artificial intelligence startup Inflection AI, which initially failed to meet merger disclosure requirements.
Regulatory Scrutiny Intensifies Amid AI Expansion
The announcement follows the FTC’s initiative in January to conduct a comprehensive investigation into AI practices involving some of the world’s largest firms, including Amazon, Alphabet, Anthropic, Microsoft and OpenAI.
FTC Chairwoman Lina Khan emphasized the importance of this initiative during the agency’s technology summit, stating that no company is above antitrust and consumer protection laws.
Such regulatory interest stems from concerns about the concentration of market power in the AI industry, where Nvidia owns about 80% of the AI chip market. Due to its dominance, Nvidia has managed to have high gross margins of 70% to 80%.
Ongoing investigations and institutional responses
The planned investigations are consistent with the current trend of increasing regulatory pressure on big tech companies.
Similar measures regarding market functioning and competitive behavior have been implemented against other major technology companies, including Google and Apple, in previous years.
This research is being conducted against the backdrop of a general industry debate about the ethical and societal impact of artificial intelligence.
An open letter published this week by OpenAI employees noted that the development of artificial intelligence is so rapid that appropriate regulatory mechanisms must be in place. These revelations underscore the growing demand for regulation in an industry projected to generate more than $1 trillion in revenue over the next decade.
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Kelvin is a distinguished author specializing in crypto and finance, with a bachelor’s degree in Actuarial Science. Known for her sharp analysis and insightful content, she is fluent in English and specializes in comprehensive research and on-time delivery.
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