FTC announce investigation into Big Tech AI funding

The Federal Trade Commission has launched an inquiry into Big Tech investments and partnerships including Microsoft, Amazon and Google demanding information and documents concerning investment into AI developers, citing concerns of lack of competition.

FTC announce investigation into AI funding

Specifically, the FTC and its Chair, Lina Khan, are exploring whether some of the world’s biggest tech firms are potentially cornering the market of generative AI, allowing the field to be controlled by a select few players.

The FTC says it has ordered five companies to provide more information on their recent investments and partnerships involving generative AI companies and major cloud service providers.

The organisation said the companies will have 45 days from the date they receive the order to respond.

The Commission said it aims to build a better understanding of the relationships between the five Big Tech firms and AI providers to assess the impact on the competitive landscape.

The companies being targeted by the probe are Alphabet, Amazon, Anthropic, Microsoft and OpenAI.

“History shows that new technologies can create new markets and healthy competition,” comments FTC chair Lina Khan. “As companies race to develop and monetise AI, we must guard against tactics that foreclose this opportunity.

“Our study will shed light on whether investments and partnerships pursued by dominant companies risk distorting innovation and undermining fair competition.”

The probe is focusing on three separate multibillion-dollar investments, including Microsoft’s investments in OpenAI.

The tech giant has been the a key investor of OpenAI in recent years and has surged in market value over the past year, rivalling Apple as the most valuable company in the world.

The FTC probe is also looking into Amazon and Google’s separate investments into Anthropic, an AI start-up founded by former OpenAI employees last year.

This company had the backing of Google when it released its own generative AI chatbot – Claude – as an alternative to OpenAI’s popular ChatGPT.

Anthropic also announced a $4 billion investment from Amazon last year and agreed to have the tech giant become its primary cloud provider.

The FTC said it will look at information related to market share, competition, competitors, markets, potential for sales growth or expansion into certain geographic locations or markets.