The United States Department of Justice and the Federal Trade Commission are purportedly collaborating to initiate an antitrust inquiry into technology behemoths Microsoft, Nvidia, and Open AI. Notably, Microsoft has made a substantial investment of over $13 billion in OpenAI, and currently possesses a 49 percent stake in the company’s for-profit subsidiary. On the other hand, Nvidia is globally renowned as a leader in graphic processing units (GPUs), a pivotal component required in the field of artificial intelligence (AI).
The principal objective of the investigation is to ascertain whether these corporations have employed anticompetitive tactics to dominate the burgeoning AI sector. Both US regulators and external observers are apprehensive about the concentration of power within a select few companies in this industry, and the potential of these entities to marginalize smaller competitors and startups through unfair business practices.
The investigation is set to be bifurcated, with the FTC focusing its attention on Microsoft and Open AI, and the DOJ scrutinising Nvidia. Both agencies are entrusted with the enforcement of federal antitrust laws, and it is speculated by experts that the approach to investigating the aforementioned companies might mirror the one adopted in the 2019 case against tech giants such as Facebook, Amazon, Apple, and Google’s parent company, Alphabet.
Renowned US antitrust lawyer Barry Bennett has expressed his belief that both enforcement agencies may be acting preemptively to prevent a lapse in the statute of limitations, or seeking to advance their inquiries well in advance of the upcoming US presidential election in November. FTC Chair Lina M. Khan has previously articulated the agency’s desire to “illuminate whether investments and partnerships pursued by dominant companies pose a risk of distorting innovation and undermining fair competition.”
The ultimate objective of the investigation is to foster a more competitive landscape within the technology sector. However, there exists a degree of trepidation that heightened regulation could impede research and innovation, as well as protract the approval process for financing and investment agreements within the AI sphere.
In conclusion, the unfolding and ramifications of these investigations remain to be seen. The outcomes of these inquiries have the potential to mould the trajectory of the AI market and dictate the degree of competition within the industry.