What’s happening: The FTC, under the guidance of Chair Lina Khan, is embarking on an ambitious journey to dissect the workings of major players in the AI industry. This includes giants like Amazon, Alphabet, Microsoft, Anthropic, and OpenAI. The inquiry, announced at the agency’s tech summit on AI, is not just a routine check-up but a thorough investigation into the “investments and partnerships” in the AI sector.
Understanding the 6(b) Study
Why it matters: The FTC is leveraging its power through a 6(b) study, a mechanism that allows for an in-depth analysis separate from its law enforcement functions. This means companies can be compelled to provide detailed reports and answer critical questions about their business operations. It’s a clear signal from the FTC that no company, regardless of its size or influence, is above scrutiny.
Lina Khan’s Stance on AI
Khan’s vision: The FTC Chair emphasizes that the rapid development of AI is influencing the agency’s entire spectrum of work. She asserts that there’s no free pass for AI in the realm of legal compliance, hinting at a rigorous approach to ensure fair competition and consumer protection.
Industry Reactions
Google’s openness: A Google spokesperson highlighted the company’s commitment to transparency, contrasting it with others who might not be as forthcoming about their AI endeavors.
Microsoft’s collaborative approach: Rima Alaily, Microsoft’s corporate VP, points to partnerships like that between Microsoft and OpenAI as drivers of competition and innovation. She expresses readiness to cooperate with the FTC’s inquiry.
Silence from others: Amazon and OpenAI have chosen not to comment, while Anthropic has not yet responded, reflecting a varied range of responses from the industry.
A Pattern of Thorough Investigations
Contextualizing the study: This isn’t the FTC’s first rodeo. In 2022, a similar inquiry was launched into the pharmacy benefit managers industry. Going back to 2020, tech behemoths like Alphabet, Amazon, Apple, Microsoft, and then Facebook (now Meta), were under the microscope for their acquisition strategies. These past inquiries set a precedent for the current AI investigation, illustrating the FTC’s consistent approach to regulating different sectors.
The Future of AI Regulation
A question still unanswered: Chair Lina Khan acknowledges the uncertainty surrounding AI liability regimes. However, she assures that the FTC’s past enforcement experiences in other domains will be instrumental in shaping its approach to AI regulation.
The big picture: The FTC’s AI inquiry is more than just a routine check. It’s a critical step towards understanding how tech giants operate in the rapidly evolving AI landscape. This investigation could potentially reshape how AI companies function and interact, ensuring fair competition and protecting consumer interests in an increasingly AI-driven world.
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